In a business auto policy scenario, which coverage applies when a business borrows a vehicle for use?

• A. Hired automobile
• B. Nonowned automobile
• C. Owned automobile
• D. Personal auto

Answer: (B)

In a business auto policy, coverage for vehicles not owned by the insured but used in the business is handled by the nonowned auto provision. This protection kicks in when the business uses a vehicle it does not own, such as borrowing someone else’s car for work. It helps address liability and, if chosen, physical damage exposure from that non-owned vehicle while it’s used in the business. Hired auto would cover vehicles the business rents or leases under a formal hire arrangement, while owned auto applies to vehicles the business owns, and personal auto is for private individuals’ vehicles. So, when a business borrows a vehicle for use, nonowned auto coverage is the appropriate protection.