Chart Summary of Vehicle Liabilities | U.S. Chamber of Commerce Small Business Nation

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Chart Summary of Vehicle Liabilities

Chart Summary of Vehicle Liabilities

Four Common Ways That Your Company May Be Held Liable for an Accident
Respondeat Superior
*Summary*	*You could lose if:*	*Help protect yourself*
Basically, a party who sues you would claim that, since your employee was doing work for you when the accident happened, you're liable.	Your employee was (at least partially) at fault in the accident. Your employee was acting in the scope of job at the time of the accident.	Establish clear, narrow policies on use of vehicles by your employees if possible. Enforce vehicle policies; use employee discipline if necessary. Maintain adequate insurance.
Negligent Hiring or Retention
*Summary*	*You could lose if:*	*Help protect yourself*
Party who sues you says you are liable because you erred in hiring/not firing the employee involved in the accident.	You should've taken more care (checking references or criminal records) in hiring. You knew/should've known the employee wasn't good and didn't fire him.	Conduct thorough hiring checks. Terminate employees who should be terminated. Do periodic performance reviews; deal with problems promptly. Maintain adequate insurance.
Negligent Lending of Vehicle
*Summary*	*You could lose if:*	*Help protect yourself*
Similar to Negligent Hiring or Retention, except that you erred in allowing the employee to drive the company vehicle, rather than when you hired/retained him.	You should have known the employee was unfit to drive your vehicle. If, for example, the employee was under the influence of any medication or was either not licensed to drive or not trained to use the vehicle.	Insist on proof of driving licenses; keep proof on file. Suspend/revoke vehicle use by any employees who commit serious driving offenses. Consider driver training. Maintain adequate insurance.
Negligence Associated with the Vehicle's Condition
*Summary*	*You could lose if:*	*Help protect yourself*
The party who sues you says you're liable because you failed to maintain the vehicle in a safe condition. You're liable even if you employed a very competent driver.	Your vehicle was somehow negligently maintained. Condition of the vehicle (bad tire, for example) helped cause accident.	Maintain vehicle better than safety standards require. Have your mechanic check vehicles periodically; use our checklist for evaluating used vehicles as a guide. Maintain adequate insurance.