Are you protected when using a company car?

Before you slide behind the wheel of a company car, make sure you and any passengers are fully covered. Experts say there are a few key car insurance-related things to keep in mind.

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Company car insurance and personal use

Employers usually allow some personal use of company cars for things like trips to the grocery store or shopping center on the way home from work, says Brian S. Kane, an insurance agent based in Glen Rock, N.J.

If you got into an accident during such an errand, "the car's liability and physical damage auto insurance policy would likely cover the claim," he says.

But just to make sure, ask your employer about the coverage before something happens.

"That will eliminate any confusion and stress should you have an accident," says Kane.

If personal use isn't covered under your employer's car insurance policy, Kane says you have two options.

"Don't use the car for any personal use, or purchase a separate auto insurance policy on your own that will cover personal use," he says.

Company car insurance coverage limitations

A company car's insurance policy might not extend to your spouse, friends or children.

"Often, spouses and children are not covered on a company car insurance policy. If your employer has a garden-variety policy, you may want to purchase a separate policy to ensure you all are protected," says Frank N. Darras, an insurance lawyer based in Ontario, Calif.

There are some other common limitations on company car policies.

"If you don't have a personal auto insurance policy of your own, the commercial auto policy doesn't extend the same coverages for rented or borrowed vehicles used for personal use," Kane says.

However, depending on your state's insurance laws, you might be covered under your employer's auto insurance policy if you rent or borrow a car for business use.

Kane says if your company "car" is actually a truck, the policy might not include medical coverage if its size qualifies it as a different-class vehicle. In the event you're hurt in an accident, those injuries - and lost wages - might not be covered, especially if you don't have health insurance or disability insurance.

"Make sure to check with your company for the details of coverage just to be safe," he adds.

Injuries and company car insurance

If you are injured in an accident while conducting company business, fault determines whose auto insurance policy handles the claim, Darras says.

If you're at fault, depending on the state you live in, the company's car insurance may cover property damages and medical and wage claims.

In other states, the company's policy would cover the property damages (to the vehicle, the other car or house you hit, etc.). Workers compensation coverage would cover your medical and wages claims.

Additionally, some states have workers compensation laws that prevent you from being sued for lost wages if your passenger is a co-worker and your negligence causes his or her injury while you are driving a company vehicle.

In such instances, the co-worker's sole remedy to recover lost wages is through workers compensation, Darras says.

"But if you live in a state without this type of workers compensation, the passenger could sue you and your employer as the owner of the vehicle," he explains.

Laws vary by state, but your employer should have this information available.

Ask questions about company car insurance

To make sure you're properly covered, Darras suggests asking your employer these insurance-related questions before getting behind the wheel of a company car:

• Who in my family can use the vehicle? Even if other drivers aren't typically covered, some company car insurance policies may extend coverage to a spouse if he or she has to drive the car in case of an emergency.
• What limits and coverages does the company provide? This will allow you to determine if you would need to purchase additional coverage to protect yourself in the event of an accident.
• What should I do if I get into an accident? Should you contact the insurance company or does the company's human resources department handle all reporting and claim processing?