What can be a consequence of failing to provide necessary coverage for hired autos?

Failing to provide necessary coverage for hired autos can result in limited liability protection for the business. When a business utilizes hired vehicles, such as renting cars or using employee-owned vehicles for business purposes, it is essential to ensure that adequate insurance coverage is in place. Without this coverage, the business may face substantial financial exposure in the event of an accident or incident involving those hired vehicles.

If an accident occurs and the business does not have the proper hired auto liability coverage, it could be held responsible for damages, injuries, or liabilities arising from that event. This could lead to significant out-of-pocket expenses that exceed the business's financial capacity, ultimately jeopardizing its financial stability.

In this context, the business’s liability protection is critical in mitigating risks associated with the use of hired vehicles. Without sufficient coverage, the business is vulnerable to claims that could otherwise have been defended or offset by its insurance policy. Therefore, having the necessary hired auto coverage is crucial to ensure that the business maintains adequate liability protection.