American Church Group - Colorado

Take the Confusion out of Borrowing or Leasing Vehicles

From time to time, your church or ministry may need to borrow or lease a vehicle for a special event. Before using a vehicle that you don’t own, you need to consider a number of factors.

Vehicle owners are primarily responsible for damage to their vehicles

State laws mandate that vehicle owners (including owners of rental vehicles) be responsible for damage that their vehicles cause. However, if the owner does not have adequate insurance, the driver’s auto policy may come into play. Consider this:

• The vehicle owner’s insurance is responsible for any damage done by the vehicle or to the vehicle.
• If someone other than the owner drives the vehicle, obtain information about the owner’s insurance (company name, policy number, and policy term). The driver will need this information if an accident occurs.
• The driver’s auto insurance may become involved, especially if an accident is their fault.

Know what coverage is included before signing a lease agreement

If you plan to rent or leased a vehicle, you should be understand several factors before you enter into a lease agreement.

• What primary liability and physical damage (comprehensive and collision) protection does the rental agency provide with the vehicle? You may need to purchase separate coverage for yourself and the vehicle.
• Purchase a collision damage waiver as part of your lease agreement if you cannot afford to pay the high deductible rental companies usually offer.
• Leasing agencies sometimes provide no physical damage coverage. If so, contact your insurance agent before picking up the vehicle to make sure that your own auto policy will adequately covers physical damage.
• Permit only individuals you registered with the rental agency to drive. Otherwise, you may violate the terms of your lease.

Understand what your auto policy covers

Most churches and ministries purchase non-owned auto liability coverage as part of their insurance program. This coverage works on an excess basis, meaning that it comes into play after the vehicle owner and driver have filed a claim with their insurance company. If the vehicle owner and driver do not have adequate coverage, your excess or "back-up" coverage will protect your ministry. However, be aware that it offers no protection for the vehicle owner or for the driver of a borrowed vehicle.