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Claim of the Month: Automobile Use Liability

We frequently get questions from our readers and Premium Members about having caregivers driving for work, whether it is transporting a client, or driving between clients.  Having the proper insurance coverage is critical to protecting your company and your personal net worth from liability.  Here’s another in a series of articles on potential liability for home care company owners.

by David Dickie, The Solutions GroupDavid-Dickie-Head-Shot

The matter involves 3rd party Jane Meeks (all names changed) who suffered severe injuries on January 23, 20XX when her vehicle was struck from behind by a vehicle driven by Constance Thomas, an employee of Pearl Home Health Care, who was driving between client’s homes.  On July 26th, 20XX the insured received a letter from Weis, Petersen, Bowles & Skinner stating that the accident was a proximate result of negligence by Ms. Thomas. Attorney Weis indicated a desire to discuss an amicable settlement.

Pearl Home Health Care turned the letter over to their liability carrier. The carrier made an affirmative coverage determination because the insured had opted to take non-owned auto coverage. (Remember, non-owned auto covers the risk of having employees drive their own car on-the-job.) Light negotiation between attorney Weis and the insurer took place, but no settlement was reached.

On December 28, 20XX, Pearl Home Health Care was served with a lawsuit demanding relief due to closed brain injury, and injuries to the neck, back and body generally resulting in medical expenses, physical pain and suffering, physical impairment, loss of mental function and mental anguish.

Liability to the caregiver and agency was clear, given the following set of facts:

  • Caregiver was driving between clients without any deviation (on-the-job)
  • Caregiver was in a hurry because clients were scheduled close together
  • A pre-employment driving record check was not conducted
  • The driving record report received after the accident showed a history of speeding violations
  • The plaintiff’s vehicle was struck from behind. A ‘rear-ender’ is always the fault of the car in back

The lawsuit was put on the docket in a very busy venue, and sat waiting for a trial date for four years. Trial commenced and was well underway when an agreement was reached between the parties:

Result: Settlement of $515,850, Defense Cost $133,264. Total Cost $649,114


  • Always check the driving record of driving employees
  • Have a standard for driving employees such as ‘no more than two moving violations in the last 3 years and no DUI/DWI/Reckless in the last 7 years’ and stick to it no matter what
  • If caregivers see multiple clients in a day, allow adequate travel time

Always take non-owned auto coverage. It can be expensive but it is so for a reason – auto accidents are the leading category in claims dollars paid for home care agencies.

For More Information, Visit The Solutions Group

The Solutions Group

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