Hired & Non-Owned Auto Endorsement in Texas

Hired & Non-Owned Auto is one of the most misunderstood endorsements in Texas commercial insurance. The name itself is dense. Let us unpack it the way we explain it across the desk at our Arlington, Fort Worth, Garland, and Mesquite offices every week.

The endorsement attaches to either a Commercial General Liability (CGL) policy or to a Business Auto policy under Texas Insurance Code §1952. It does not stand alone — there is no such thing as "just HNOA". You buy it as an add-on. What it does is extend your business's liability protection into two specific gap scenarios that the underlying policy does not touch.

What it covers: Third-party liability — bodily injury to other people and property damage to other vehicles or structures — that arises from (1) an employee operating their own personal vehicle while doing work for your business, or (2) your business renting, leasing, or borrowing a vehicle for short-term use. The minimum Texas financial responsibility under Texas Transportation Code §601.072 is 30/60/25, but on commercial endorsements we almost always write to $500,000 or $1,000,000 combined single limit because the litigation exposure is far higher than personal auto.

What it does not cover: Vehicles the business owns and titles, damage to the employee's own vehicle, damage to the rented vehicle itself (that needs Hired Auto Physical Damage as a separate add-on), personal use by the employee outside of business hours, or any driver who is excluded by name. We have seen too many small-business owners assume HNOA was a substitute for full commercial auto — it is not. If your business owns even one titled vehicle, you need a full commercial auto policy, and HNOA layers on top to catch the employees who drive their own cars.

The endorsement is bifurcated in its name for a reason. "Hired" and "Non-Owned" are two different exposures that the insurance industry historically priced and underwrote separately, then bundled because most small businesses have both at the same time.

Most carriers in Texas will not sell you one half without the other — they are packaged as a single endorsement because a business with one exposure almost always has the other. The combined rate is also significantly cheaper than buying them piecemeal.

If you run a small business in Dallas, Fort Worth, Arlington, Plano, Garland, Mesquite, Irving, or Grand Prairie and any of the following sounds like a Tuesday in your operation, you need HNOA. We see these five profiles weekly.

HNOA is one of the cheapest pieces of liability protection a small Texas business will ever buy, dollar-for-coverage. The reason is straightforward: the endorsement only triggers in narrow, specific gap scenarios, so loss frequency from the carrier's perspective is low — but when it does trigger, the limits available are substantial. Underwriters love that profile, and they price it accordingly.

Here is the pricing pattern we see across our 35+ carrier panel for Texas small businesses:

• Base premium ($50–$75/mo): Service businesses with 1–3 employees who occasionally drive their own vehicles or rent a U-Haul a few times a year. $500K combined single limit.
• Mid-tier ($75–$120/mo): Real-estate brokerages, mobile service businesses, contractors with 4–8 employees, occasional rental exposure. $1M combined single limit.
• Delivery-heavy ($120–$180/mo): Restaurants, florists, couriers, pharmacies — daily employee-driven deliveries. $1M combined single limit. Some carriers will not write this exposure at all without a defensive-driving program documented for all delivery employees.
• Hired Auto Physical Damage add-on ($15–$40/mo): Optional extra layer that covers damage to the rented vehicle itself. Cheaper than buying the U-Haul/Penske loss-damage waiver each time you rent.

Factors that move you up or down the band: number of employees driving for work, frequency of business driving (weekly vs daily), Motor Vehicle Records (MVRs) of any named drivers we can identify, the underlying liability limit you select, and whether you have a documented driver-safety policy. We have placed HNOA for two Plano real-estate offices with 12 agents each: one paid $68/mo because the brokerage had a clean three-year loss history; the other paid $134/mo because one agent had a 2024 at-fault accident on her personal record that the carrier surcharged onto the commercial policy.

The single biggest pricing lever is liability limit. Going from $500K to $1M combined single limit usually only adds $15–$25/mo, which is one of the best dollar-for-dollar coverage upgrades in commercial insurance. We almost always recommend $1M to clients in this segment because a single bodily-injury verdict in Dallas or Tarrant County district court routinely exceeds $500K when there is any hospitalization involved.

The number of coverage gaps inside HNOA itself is the single biggest source of bad surprises we see in our offices. Here are the seven exclusions that bite small businesses most often, and how we handle each one.

• Business-owned vehicles: If the business owns or titles the vehicle, HNOA does nothing. You need a full commercial auto policy.
• The employee's own vehicle damage: HNOA only pays third-party liability. The employee's collision claim goes to their personal carrier — and yes, many personal carriers will surcharge them.
• Damage to the rented vehicle itself: Hired Auto Physical Damage is a separate add-on. Without it, you owe U-Haul for the damaged truck out of pocket.
• Personal use outside business hours: If your employee crashes on the weekend running personal errands in her own car, HNOA does not respond. That is her personal policy's job.
• Commuting (in some carriers' forms): A few carriers exclude pure commuting from home to the regular workplace. The roofing crew chief driving from home to the job site is covered because the job site changes — but the office manager driving her standard commute is not. Read the endorsement form.
• Vehicles owned by the named insured or principal: If the LLC owner's own personal pickup is being used for business, some forms treat it as a "family" vehicle that should be scheduled on commercial auto, not covered through HNOA. This is a common audit dispute.
• Federally regulated motor carriers (FMCSA): If your business has any vehicle subject to FMCSA requirements (interstate trucking, hazmat, passenger-carrying), HNOA alone is insufficient — you need MCS-90 and a full motor-carrier policy.

The most common gotcha we resolve at our front desk: a contractor with three pickups in his own name (titled to the LLC owner, not to the LLC) thought HNOA covered him because the trucks were "non-owned by the business." The carrier disputed the claim because the trucks were owned by a principal of the named insured. We rewrote him to a small commercial fleet policy the same week.

HNOA is an endorsement, not a standalone policy. That means the very first underwriting question we ask is: what is the underlying policy you want to attach it to? There are two valid answers, and which one applies depends entirely on whether your business owns any titled vehicles.

There is also Option C — a Business Owners Policy (BOP) that bundles general liability with property coverage, with HNOA bolted on. This is what we write for the majority of our DFW small-business clients because the BOP is itself a cheaper container than a freestanding CGL. We will not let the conversation get past the first 90 seconds at our intake desk without asking: Does the business own any titled vehicles? Do any employees ever drive their own car for work? Do you ever rent a U-Haul or Penske? Those three questions sort the business into the correct configuration immediately.

If you walk into any of our 14 DFW offices — Arlington, Dallas, Fort Worth, Garland, Grand Prairie, Hurst, Irving, Mesquite, Plano, and our other Tarrant and Dallas county locations — we can have HNOA added to your existing commercial policy before you finish your coffee. Here is exactly what happens.

1. Bring your current policy declarations page. Whether it's a CGL, BOP, or commercial auto, the dec page tells us the underlying liability limit, named insureds, and effective dates. If you cannot find it, call your current carrier from our front desk and we'll pull it for you.
2. Answer six questions. How many employees? Do any drive their own vehicles for work, and how often? Do you ever rent a U-Haul, Penske, or rental sedan? Any titled business vehicles? Any FMCSA-regulated vehicles? Any losses in the last three years? That's it.
3. Choose a limit. We'll quote you at $500K and at $1M combined single limit so you see the spread. Almost all clients choose $1M because the marginal cost is $15–$25/mo.
4. Sign the endorsement request. We e-file it to the carrier the same day. Most carriers in our panel return a binder within 30 minutes during business hours.
5. Receive your updated Certificate of Insurance (COI). If you need a COI for a client, landlord, vendor, or contractor that requires it (very common with commercial real-estate landlords and general contractors), we issue the updated COI the same day with HNOA reflected.
6. Pay. Endorsement premium is pro-rated against your existing policy term. If you're six months into a 12-month policy, you pay six months of HNOA premium up front and then it renews with the underlying policy.

We do not require any kind of fleet safety audit or MVR pull on every employee for standard HNOA placement at small-business scale — most carriers only request MVRs if you have more than 10 employees driving for work, or if the business has a prior commercial auto loss on its CLUE history. For mid-sized clients we still recommend a documented driver-safety policy because it can drop premium by 10–15% with several of our carrier partners.

If you want to start now from your phone, hit our quote tool and select "Commercial" — the intake form will route you to a commercial agent within 60 seconds during business hours. Or call (866) 252-6116. We also write related coverages: a commercial auto policy for contractor pickup trucks, small fleet coverage for 2-5 vehicles, and our standard Texas auto insurance for the personal vehicles your employees drive off the clock.