Hired And Non-Owned Auto Certificate: A Practical Guide for Agencies

The hired and non-owned auto certificate of insurance is one of the most frequently mishandled documents in commercial insurance. Brokers either omit the coverage from the certificate entirely or fail to document it correctly, creating exposure for both the client and the agency. This guide explains what HNOA coverage is, when it is required, and exactly how to reflect it on a certificate.

Key Takeaways

• Hired auto covers vehicles rented or borrowed by the business. Non-owned auto covers employee-owned vehicles used for business. Both require a specific endorsement; neither appears automatically on a commercial auto policy.
• Standard ISO commercial general liability (ISO CG 00 01) excludes auto liability. A business with no owned vehicles that relies on employees driving personal cars has zero auto liability coverage without a HNOA endorsement.
• ISO CA 20 54 provides hired auto coverage. ISO CA 20 01 provides non-owned auto coverage. Many carriers issue a combined HNOA endorsement that replaces both individual forms.
• HNOA endorsements cost between $200 and $1,500 per year depending on payroll and industry. The average commercial auto liability claim exceeds $70,000, according to ISO 2024 commercial lines data.
• On the ACORD 25, HNOA coverage is documented in the Automobile Liability section using the "Hired Autos Only" checkbox and confirmed in the Description of Operations with specific endorsement form numbers.
• According to IIABA 2025, failure to document HNOA on certificates is among the top 10 causes of commercial auto E&O claims at independent agencies.

What Is Hired Auto Coverage?

Hired auto coverage applies when the insured business rents, leases, or borrows a vehicle for temporary use. The vehicle is not owned by the business. Common scenarios include:

• An employee rents a car at an airport while traveling for business
• The company leases a short-term rental van for a trade show or event
• The business borrows a vehicle from a vendor or partner for a specific project

In each of these situations, the vehicle creates auto liability exposure for the business. If an employee driving a rented car causes an accident while on company business, the business faces liability regardless of who owns the vehicle. Hired auto coverage addresses that exposure.

The rental car company's collision damage waiver (CDW) does not cover third-party liability. The employee's personal auto policy may provide some coverage but typically at personal limits that are far below commercial contract requirements.

What Is Non-Owned Auto Coverage?

Non-owned auto coverage applies when an employee, partner, or household member uses a personally-owned vehicle in the course of business. The vehicle is not rented; it is privately owned by someone other than the business.

Common non-owned auto scenarios:

• An employee drives their personal car to a client meeting
• A sales representative uses their own vehicle for territory calls
• A partner drives their personal truck to pick up materials for a project
• An employee makes a business delivery in their own car

The employee's personal auto policy is the primary coverage for the employee. But the employer faces vicarious liability claims when an employee causes an accident while acting within the scope of their employment. Non-owned auto coverage protects the employer from those claims.

The employee's personal auto policy may not have adequate limits for a serious commercial liability claim. A $100,000 personal auto policy is insufficient protection for a business facing a $500,000 bodily injury claim from a serious accident. HNOA fills the gap by providing the business's commercial auto liability limits for covered claims.

Why Standard GL Does Not Cover HNOA

This is the most costly misconception in commercial insurance. Many business owners and some brokers assume that general liability covers everything the business does, including auto-related incidents involving employees. It does not.

ISO CG 00 01 (the standard GL policy form) contains an explicit auto exclusion. The exclusion bars coverage for bodily injury or property damage arising from the use of any auto by any insured. This exclusion is broad and applies regardless of who owns the vehicle.

A business that owns no vehicles and has no commercial auto policy has a significant uninsured exposure if employees drive personal vehicles for business purposes. The GL policy will not respond to those claims. The employee's personal auto policy will respond first, but only for claims within personal auto policy limits and only to the extent the employee is personally liable.

According to NAIC 2024 data, businesses with no owned vehicle fleet account for approximately 28% of commercial auto liability claims paid by insurers each year. Most of those claims involve non-owned autos.

When Is HNOA Required?

Contract language drives HNOA requirements for most commercial accounts. The following situations consistently generate HNOA requirements:

Vendor and service contractor agreements: companies that require vendors to carry auto liability typically specify "any auto" coverage or explicitly require hired and non-owned auto coverage. A vendor that does not own vehicles but has service technicians driving personal cars to job sites needs HNOA.

Government contracts: federal and state agencies routinely require HNOA coverage in contractor agreements, even for contractors with no owned fleet. Contract language often reads: "auto liability including owned, hired, and non-owned autos."

Commercial leases: commercial landlords increasingly require tenants to carry HNOA coverage if the tenant's employees drive to the business location. The landlord's concern is that a tenant's employee causing an accident in the parking lot creates a liability connection to the property.

Professional services firms: law firms, consulting firms, accounting practices, and similar businesses whose employees travel to client sites generate consistent HNOA exposure. Even in cities where most travel is by taxi or rideshare, client-site visits in personal vehicles create non-owned auto exposure.

Trucking broker agreements: freight brokers that contract with owner-operators often require HNOA coverage as a backstop for vehicles the broker does not own but directs.

How HNOA Coverage Is Provided

There are three sources of HNOA coverage, each with different applications and limitations:

1. Endorsement to the Commercial Auto Policy

This is the most common approach for businesses that already have a commercial auto policy for owned vehicles. The insurer adds ISO CA 20 54 (hired auto) and ISO CA 20 01 (non-owned auto) to the existing policy, or issues a combined HNOA endorsement that covers both.

Coverage under this approach is at the same limits as the commercial auto policy. The endorsement extends the policy's liability limit to hired and non-owned vehicles. This is the cleanest solution for accounts that have both owned and non-owned auto exposure.

2. Endorsement to the Commercial General Liability Policy

For businesses that own no vehicles and have no commercial auto policy, some insurers offer HNOA coverage as an endorsement to the GL policy. This approach is less common than it once was, and the coverage it provides is often narrower than a standalone commercial auto endorsement.

The GL-attached HNOA endorsement covers the business for non-owned auto liability, but limits may be lower than the GL policy limit, and the coverage terms may differ from a true commercial auto policy. Verify the specific endorsement language before relying on this approach for accounts with significant auto exposure.

3. Standalone HNOA Policy

Businesses with high vehicle use but no owned fleet, such as a delivery company that uses independent contractors' vehicles or a staffing firm whose workers drive personal vehicles extensively, may need a standalone HNOA policy rather than an endorsement.

Standalone HNOA policies provide dedicated limits and terms without tying the coverage to an existing GL or commercial auto policy. They are appropriate when the business's non-owned auto exposure is large enough to warrant its own policy structure.

Coverage Source Comparison Table

How to Show HNOA on the ACORD 25

The ACORD 25 certificate of insurance has specific fields for documenting auto coverage. HNOA documentation requires careful attention to both the checkbox fields and the Description of Operations.

For a business with owned autos and HNOA endorsement:

In the Automobile Liability section, check the applicable boxes for the policy (typically "Owned Autos Only" or "Any Auto" depending on the symbol). In the Description of Operations, state: "Commercial auto policy includes hired and non-owned auto liability per ISO CA 20 54 / CA 20 01 [or carrier equivalent form number]."

For a business with no owned autos and HNOA only:

In the Automobile Liability section, check the "Hired Autos Only" box. This checkbox on the ACORD 25 is designed for situations where the policy covers hired and non-owned vehicles but no owned fleet. In the Description of Operations, state: "Coverage includes hired and non-owned auto liability. No owned autos. Endorsed per [endorsement form number]."

For a GL-attached HNOA endorsement:

Do not use the Automobile Liability section for a GL-attached endorsement. Document the coverage in the General Liability section and note in the Description of Operations: "GL policy includes hired and non-owned auto liability per [endorsement form number]. No owned commercial auto policy."

Specificity matters. According to ACORD 2025 guidance, certificate holders in transportation, construction, and government contracting are returning certificates without specific endorsement references and demanding form numbers before accepting the certificate as compliant.

The Cost of HNOA Coverage vs. the Cost of a Gap

HNOA endorsements are one of the most cost-effective coverages available in commercial insurance. Annual premium for an HNOA endorsement typically runs:

By comparison, ISO 2024 commercial auto claims data shows the average bodily injury claim in commercial auto exceeds $70,000. Serious accidents with multiple injuries or fatalities regularly produce claims in the $500,000 to $1,000,000+ range.

A business that skips a $400 HNOA endorsement to save money and then faces a $300,000 claim from an employee's accident in a personal vehicle has no coverage from the GL policy and no commercial auto policy in force. The claim falls entirely on the business's assets.

The premium cost of HNOA coverage is one of the clearest return-on-investment calculations in commercial insurance.

Frequently Asked Questions

What is hired and non-owned auto coverage and why is it important?

Hired auto coverage applies when the business rents, leases, or borrows a vehicle. Non-owned auto coverage applies when employees use personal vehicles for business purposes. Together, HNOA coverage protects the business from auto liability claims in situations where the vehicle is not owned by the business. Without HNOA, these exposures are uninsured because standard GL policies explicitly exclude auto liability.

Does commercial general liability cover hired and non-owned auto?

No. ISO CG 00 01, the standard GL policy form, contains an explicit auto exclusion that bars coverage for any auto-related bodily injury or property damage. A business that relies on GL to cover HNOA exposure has no coverage for those claims. GL-attached HNOA endorsements are available but must be specifically added to the policy.

Who needs hired and non-owned auto coverage?

Any business where employees drive rented vehicles or personal vehicles for business purposes needs HNOA coverage. This includes professional services firms, vendors and service contractors, delivery businesses using independent contractor vehicles, companies with employees who travel to client sites, and any business required by contract to carry auto liability coverage for "any auto" including hired and non-owned.

How is hired and non-owned auto shown on an ACORD 25 certificate?

For accounts with no owned vehicles, check the "Hired Autos Only" box in the Automobile Liability section. For accounts with owned vehicles plus HNOA endorsement, check the applicable owned auto boxes and document the HNOA endorsement form numbers in the Description of Operations. Always include the specific ISO or carrier endorsement form number. Vague language such as "HNOA included" without a form number does not satisfy most contract requirements.

What ISO endorsements provide hired and non-owned auto coverage?

ISO CA 20 54 provides hired auto coverage. ISO CA 20 01 provides non-owned auto coverage. Many carriers issue a combined HNOA endorsement that incorporates both. For businesses with no commercial auto policy, some insurers offer GL-attached HNOA endorsements, though these provide narrower coverage than the commercial auto endorsement forms.

What is the cost of a hired and non-owned auto endorsement?

Annual premium for an HNOA endorsement ranges from approximately $200 to $1,500 depending on payroll size and industry. Small businesses with payroll under $500,000 typically pay $200 to $500 annually. Mid-size businesses pay $500 to $1,000. The premium is far below the cost of a single uninsured auto liability claim, which averages over $70,000 per claim according to ISO 2024 commercial lines data.

BrokerageAudit's COI Manager tracks HNOA endorsements on every policy and verifies they're correctly noted on outgoing certificates. See how it works →

Written by Javier Sanz, Founder of BrokerageAudit. Last updated April 2026.