North Carolina Adjuster Practice Exam

What endorsement extends policy coverage to an employee using their own vehicle for business purposes?

1. Coverage for Hired Autos

2. Employee as Additional Insured

3. Non-Owned Auto Coverage

4. Business Use Coverage

The correct answer is: Employee as Additional Insured

The correct choice for extending coverage to an employee using their own vehicle for business purposes is the option that signifies that the employee is recognized as an additional insured on the business's policy. This endorsement provides essential liability coverage to employees who operate their own vehicles during the course of their work duties, which may include transporting goods or meeting clients. In the context of vehicle insurance, the inclusion of employees as additional insured individuals ensures that any liabilities arising from their use of personal vehicles for business purposes are covered under the business's insurance policy. This is crucial, as general personal auto policies may not provide sufficient coverage for business-related incidents. The other options serve different purposes. Coverage for Hired Autos pertains to vehicles that a business rents or leases, while Non-Owned Auto Coverage addresses situations where a business has liability for vehicles not owned by them but used in their operations. Business Use Coverage generally points to modifications for personal vehicles to cover business usage but does not specifically address enhancing liability for an employee using their own vehicle. Therefore, the endorsement that specifically extends coverage to include employees using their own vehicles for work is the recognition of those employees as additional insureds under the business's insurance policy.