If an automobile is insured personally but registered to a business and involved in an accident, is the business responsible for damages?

My employer gave a vehicle belonging to the company to her son. He first obtained insurance, and then switched the title days later. During the days that the title was still registered to the business, he was involved in an accident. Is our business legally responsible for the damages?

Asked on July 17, 2012 under Accident Law, Pennsylvania


Robert Slim / Robert C. Slim - Attorney at Law

Answered 8 years ago | Contributor

The fact that the business held title in its name is not conclusive as to the liability of the business.  The pivotal issue is whether the vehicle was being used for company business at the time of the accident.  If so, then the business can be held liable.  If not, then the business is not liable.

As a practical matter, however, the fact that the vehicle is titled under the business makes the business vulnerable to being named in a subsequent lawsuit.  And once you are in a lawsuit, anything can happen.  

Nevertheless, the main issue is whether a judge or jury will believe that the vehicle was being operated for company business at the time of the accident.

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