If n employee damages a company vehicle with his own car on company grounds, should the employee’s auto insurer pay?

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If n employee damages a company vehicle with his own car on company grounds, should the employee’s auto insurer pay?

Asked on July 9, 2015 under Accident Law, Missouri

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 6 years ago | Contributor

The employee is liable, or responsible to pay, if he or she was at fault in the accident--so if, for example, he or she was negligent, or careless, in hitting the company vehicle, the employee would have to pay regardless of whether the employer has insurance, since even if the employer does have insurance and the insurer pays, the insurer could then, under its right of "subrogation" (basically, it's right to recover amounts it pays out from at-fault drivers) sue the employee.

(Technically, if no one asks the employee for the money, then he/she would not have to pay--so if there is an insurer who does pay out and neither the employer nor the insurer tries to get the money from the employee, the employee does not have to come forward and pay voluntarily.)

If the employee was not a fault, he or she would not be liable--liability depends on and grows out of fault.

Note that the employer could fire the employee for damaging its vehicle, whether or not the employee was at fault, unless the employee had a written contract protecting his or her employment in situations like this.


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