Definition and Meaning
Hired Automobile (noun): In vehicle insurance, a hired automobile refers to a car that does not belong to the insured, members of their household, or their employees. It is leased, borrowed, or rented by the insured for short-term use.
Etymology
- Hired: From Middle English ‘hieren’, deriving from Old English ‘hȳrian’, meaning to pay for the use of something.
- Automobile: Combining Greek ‘auto-’ (self) and French ‘mobile’ (movable), literally “self-powered vehicle.”
Background
In many insurance policies, different clauses and provisions specify the nuances of coverage for vehicles, whether they belong to the insured or not. The term “hired automobile” is particularly significant when discussing liability and coverage options in vehicle insurance policies. Companies often require this distinction to manage risk and ensure appropriate coverage levels.
Key Takeaways
- Definition Specificity: Hired automobiles are specifically cars that the insured does not own but has temporary possession of through leasing, borrowing, or renting.
- Insurance Coverage: Typically covered under a non-owned or hired auto endorsement in a vehicle insurance policy.
- Short-term Usage: Implies short-term possession rather than ownership or long-term leasing.
Differences and Similarities
Differences:
- Owned Automobile: Belongs to the insured or members of their household.
- Hired Automobile: Leased, borrowed, or rented; does not belong to the insured.
Similarities:
- Both owned and hired automobiles can be covered under comprehensive auto insurance policies.
Synonyms
- Rental Car
- Leased Vehicle
- Borrowed Car
Antonyms
- Owned Car
- Personal Vehicle
Related Terms with Definitions
- Non-owned Automobile: Vehicles operated by the insured but owned by another party (e.g., company car).
- Rental Reimbursement: Insurance coverage for the cost of renting a vehicle if the insured’s car is being repaired due to a covered claim.
- Lease Gap Insurance: Insurance that covers the difference between the leased car’s actual cash value and what is owed on the lease.
Frequently Asked Questions
What is the difference between a hired and a non-owned automobile?
A hired automobile is rented or leased for short-term use, whereas a non-owned automobile is one that the insured drives regularly but is owned by another entity, usually an employer.
Does standard auto insurance cover hired vehicles?
Not always. Specific endorsements or coverage extensions might be necessary to cover rented or leased vehicles adequately.
Questions and Answers
Why is it important to understand the term ‘hired automobile’?
Understanding this term ensures that one secures appropriate insurance coverage for all possible vehicle usage scenarios, thereby minimizing financial risk during accidents or losses.
Can a hired automobile be used for business purposes?
Yes, hired automobiles can be used for business, but specific commercial auto insurance coverage may be required.
Exciting Facts
- Rental car insurance coverage often varies significantly between providers.
- Some credit card companies offer rental car insurance as a perk for using their card to pay for the rental.
Quotations and Proverbs
- “The road to success is dotted with many tempting parking spaces.” – Will Rogers
- “Cars are the ultimate symbol of freedom, independence, and status.”
Clichés and Idioms
- Drive a hard bargain: Negotiate effectively.
- Take the wheel: Assume control.
References to Government Regulations
Many states and countries have specific requirements for rental car insurance coverage, and failing to comply can result in significant legal and financial repercussions.
Suggested Literature and Further Studies
- “Insurance and Risk Management for Dummies” - Jack Hungelmann
- “The Complete Guide to Auto Insurance: Understanding Your Coverage and Rights” - Alice Hall
Lillian Mercer, bringing clarity through comprehensive insight, one term at a time. Safe travels and sound policies! 😊🚗✨
