Vicarious Liability

This is an inherited exposure from such activities as pulling trailers that are owned by others or conversely, where owned trailers are pulled by other carriers. In addition, carriers must be aware of inheriting exposure should they use shipping documents generated by another party e.g. a shipper, manufacturer or another carrier who has a contractual agreement with a shipper or manufacturer. In such cases, without the protection of your own Bill of Lading, contractual obligations placed on others can be transferred.

Negative Positive
Rental/Lease of equipment without purchasing insurance when Zurich’s policy excludes short term or daily rental. Audit and ongoing monitoring of vehicle use procedures.
Uncontrolled fleet procedures to be aware of opportunities to use a Company vehicle for others (moonlighting). Active risk assessment to allow proactive action aimed at avoidance of these types of inherited exposures.
Using sub-contractors who have insufficient third party insurance coverage. Company policies ensure that all subcontractors provide proof of adequate insurance.
Allowing passengers (non employees) to be carried. Provide training to staff to ensure understanding of Company policies.

  • Company procedures must extend to include such things as personal use and passenger policies.
  • Establish a procedure which requires that any sub-contractor, driver agency, or casual drivers are required to have in place adequate insurance coverage i.e. at least equal to your own insurance coverage and limits, and that documentary proof of insurance is received prior to any work being assigned, as well as monitored on an ongoing basis to ensure that coverage(s) are current,
  • The Company is aware of any Hold Harmless agreements that may exist which could create an obligation for acceptance of vicarious liability.
  • Risk Management activities address all areas of operations to ensure that Vicarious Liabilities are recognized and obviated.