FAQ – Commercial Automobile

Commercial Drivers and Drug Testing-Pt. 2

The Department of Transportation enacted the Controlled Substances and Alcohol Use Testing and Education program to help employers protect the public against drivers who use controlled substances during their work. We will discuss the act in two parts. This part will focus on penalties, training, recordkeeping and consequences of non-compliance. 

Penalties For Failing A Drug Test – A driver who fails any alcohol or substance abuse test may face the following:

  • suspension from performing any “safety functions”
  • evaluation by a “substance abuse professional”
  • extensive documentation of test results
  • retesting of the suspended driver, with passing results (alcohol test with no more than .02 blood alcohol and a negative controlled substance test) before reinstatement.
  • Termination (not a regulation, but at the discretion of the employer)

Record Keeping Requirements – Employers must maintain complete records of their drug-testing results for at least five years. Further, an employer must keep a calendar year summary of their testing program that is subject to review by the Federal Highway Administration (FHWA).

Training Required By The Regulations – Drivers must receive training in substance abuse avoidance and be given a manual on the company’s alcohol and substance abuse policy. Manuals must be acknowledged in writing and it must be kept on file. Supervisors – employees who are authorized to order testing based on reasonable suspicion of abuse must have two hours training.

Respecting Employee Rights – Employers should consider:

  • Supervisors who order a test under reasonable suspicion should base his/her judgment upon specifics
  • Before testing, the driver must be verbally notified that it is required by statute
  • Only a properly trained supervisor can order a drug/alcohol test due to reasonable suspicion
  • Random tests must truly be random
  • Any random test must be given either just before, during or after performance of a “safety function”

Required Rehabilitation Services – Any driver who is tested by a supervisor due to suspicious behavior (regardless of test results) must be given the names, addresses and phone numbers of “substance abuse professional” counseling and treatment programs. Before reinstating an employee who has failed a drug or alcohol test, the driver must undergo evaluation, pass drug testing and be given follow-up tests.

Employers Who Use Independent Drivers – These employers have to periodically verify that the drivers participate in an approved alcohol and controlled substance testing program. The business must secure written evidence that the drivers have been tested and have passed these tests.

Consequences Of Noncompliance – A company that fails to comply with the Act may face civil and/or criminal penalties. In addition, a party that decides to sue a company because of an accident might use any evidence of violations against it.

Commercial Drivers and Drug Testing-Pt. 1

The Department of Transportation enacted the Controlled Substances and Alcohol Use Testing and Education program to help employers protect the public against drivers who use controlled substances during their work. We will discuss the act in two parts. This part will focus on the actual regulations and who is subject to the act. 

Nationally, drivers must comply with the following:

  • .04 is the maximum blood alcohol level for persons operating a commercial motor vehicle.
  • The driver cannot possess any non-manifested (listed) drugs or alcohol in his vehicle.
  • No on-duty use of drugs or alcohol permitted, including avoidance of use within four hours before operation or eight hours following an automobile accident.
  • Cannot refuse either a random or post-accident drug or alcohol test.

Commercial Motor Vehicle Definition – Under the rules, a commercial motor vehicle is one that has a gross combined weight (GCW) of more than 26,000 lbs.; that is made to carry 16 or more passengers (including driver); or that is used to transport hazardous material.

Persons Subject to the Act – Any person who operates a commercial motor vehicle must follow regulations. Affected persons include, full-time, regularly employed drivers (included self-employed operators); casual, intermittent or occasional drivers; leased drivers and independent owner operator contractors who are either directly employed by or under lease to an employer who operates a commercial motor vehicle at the direction of or with the consent of an employer. It’s important that businesses be aware that any person who operates a commercial motor vehicle must comply with the act, regardless whether the person has a commercial driver’s license.

The regulations apply during any time that a driver is performing a safety function. Safety functions include a wide variety of tasks such as:

  • While waiting to be dispatched
  • During equipment inspection
  • Anytime at a vehicle’s controls
  • During a vehicle’s loading/unloading
  • During a vehicle’s repair

Compliance with the Act involves testing for alcohol use as well as for use of marijuana, cocaine, amphetamines, PCP and opiates. Drivers are required to tell their employers when they are using any therapeutic or prescription drugs. Testing must be performed prior to offering employment, within a certain time after an accident, and at random times. If justified, testing can be ordered for a driver. However, that can only take placed if a trained person has a reasonable suspicion that the driver is affected by drugs or alcohol.

Coverage for Business Autos

Almost every business may face a loss due to its owning, renting, using, or loading/unloading a vehicle. Most coverage needs can be handled by a business auto policy (BAP) or similar form. BAPs may cover a variety of operations, including trucking, garaging, public and private transport and businesses with auto exposures that fall outside the other classes. Coverage is flexible. It may be purchased as a separate policy or as part of a package of coverage that may also protect buildings and business property (equipment, furniture, etc.). A BAP generally offers:

  • Liability Coverage – protection for physical injury to other persons or their property because of an accident related to your covered vehicle including legal defense cost or expense.
  • Comprehensive Coverage – handles loss from any cause except collision. A limited, less expensive option is available. It only protects against a set of specific causes such as fire, lightning, explosion, vandalism and several others)
  • Collision – takes care of damage from crashes with another object or overturn of the vehicle
  • Towing And Labor Costs for disabled vehicles
  • Loss of Use-Rental Vehicle Coverage – if you damage a rental car, this option helps to reimburse the rental company for income it loses because the vehicle is out of use. Also, there may be limited coverage for injury or damage that you cause to others while using a rented vehicle anywhere in the world.

Business Auto Policy Exclusions

Typically a business auto (or similar form) will not provide coverage for the following:

  • any injury/damage that you expected or intended
  • responsibility for damage you assume under a contract
  • losses that should be handled by a Workers Compensation, Disability Benefits or Unemployment Compensation Law
  • Bodily Injury to an employee caused by a Fellow Employee
  • Damage to property that is in your Care, Custody and Control
  • Any bodily injury or property damage that occurs because of Pollution
  • Any loss that is related to racing, demolition or stunts

Other items that are not covered are the same as those found with most types of policies, such as Nuclear Hazard or any type of War or Military Action. Racing, Wear and Tear, Freezing, Mechanical or Electrical Breakdown, Blowouts, Punctures or Other Road Damage to Tires are also excluded.

Are you protected against business auto losses? Drive over and discuss your situation with an insurance professional. The trip will be worth it.

Non-Owned Auto Coverage

Employees routinely use their own vehicles in their jobs or just to run errands for their employer. Does your company have protection in case of an accident and both your worker and your company are sued?

If your company has a business auto policy, it should include coverage for ‘non-owned’ automobiles. These are vehicles owned by others (such as an employee) that are used in the business of the company. Generally a business auto policy only protects against losses involving company-owned vehicles, so it is important to add “non-owned” coverage.

Basic business auto insurance only covers employees while they operate a company-owned vehicle to perform company business. Usually, the employee’s personal automobile policy will provide insurance to both the employee and the business when operating their personal auto on behalf of the business. However, some personal auto policies now exclude business use. So, a coverage gap may exist if the business coverage is not extended to handle non-owned vehicles.

Another important consideration is, even if coverage exists, is the coverage amount enough? The non-owned auto liability limits have to be high enough to protect both the business and the employee. A company has to take time to study this coverage need to be sure that a proper level of coverage is bought.

Including ‘non-owned’ auto liability coverage on the business policy will provide coverage for the business over any deficiency in limit from the employee’s personal auto policy. This is coverage for the BUSINESS, not the employee.

If the company does not own any automobiles, it is possible to purchase business auto liability coverage for only the danger of loss involving its use of ‘hired and non-owned’ vehicles. The ‘hired’ portion would cover business travel and vehicle rentals; the ‘non-owned’ portion would cover employees using their own auto in the business.

Even if an employee’s use of a personal autos for company business rarely happens, it only takes one serious accident to create a significant loss for the business. You should find an opportunity to discuss this coverage with an insurance professional.

Commercial Auto Symbols

Have you ever, during a particularly wild moment, closely examined the insurance policy that covers your business vehicles? If so, you may have noticed the little numbers that appear next to each coverage. Hopefully you’re familiar with these numbers and their meaning. If the symbols mystify you, then by all means keep reading.

Covered Auto Designation Symbols

Those little numbers on your policy’s cover page are called covered auto designation symbols or, to their friends, just symbols. Each symbol has a special meaning as they represent the type of vehicle that is protected by the applicable liability or physical damage insurance limit. As you read the symbol definitions, it’s important to remember two things. The first is that the symbol may apply to either a particular kind of vehicle OR the vehicle’s ownership status. The second item is that “auto” is a defined term, so you must be familiar with your policy’s definitions. Also notice that the symbols differ depending on whether the coverage is for liability or physical damage.

Liability Coverage Auto Symbols

1 = ANY “AUTO”. This is the broadest symbol designation and covers any “auto.”

2 = OWNED “AUTOS” ONLY. This symbol covers any “auto” owned by an insured, including any “auto” that is acquired after the policy begins. The symbol also applies to any “trailer” while it is towed by an owned vehicle.

3 = OWNED PRIVATE PASSENGER “AUTOS” ONLY. This symbol covers only private passenger type “autos” owned by the insured, including any private passenger type that may be acquired after the policy begins.

4 = OWNED “AUTOS” OTHER THAN PRIVATE PASSENGER “AUTOS” ONLY. This symbol covers all “autos” other than private passenger type “autos” (vans, trucks, motorized equipment) owned by an insured, including such vehicles that may be acquired after the policy begins. The symbol also applies to any “trailer” while it is towed by an owned vehicle.

5 = OWNED “AUTOS” SUBJECT TO NO-FAULT. Any “auto” owned by an insured that is garaged or licensed in a state where no-fault benefit laws exists. This symbol also applies to any “auto” acquired after the policy begins.

6 = OWNED “AUTOS” SUBJECT TO A COMPULSORY UNINSURED MOTORIST LAW. Any “auto” owned by an insured that is garaged or licensed in a state where drivers are required to carry uninsured motorist coverage. This symbol also applies to any “auto” acquired after the policy begins.

7 = SPECIFICALLY DESCRIBED “AUTOS”. Only those “autos” that are specifically listed on the policy are covered. The symbol also applies to any “trailer” while it is towed by a listed vehicle.

8 = HIRED “AUTOS” ONLY. This symbol covers only those “autos” that an insured leases, hires, rents, or borrows. HOWEVER, it does NOT include “autos” leased, hired, rented, or borrowed from an employee, partner, or member of an insured’s household.

9 = NONOWNED “AUTOS” ONLY. This symbol covers only those “autos” an insured does not own, lease, hire, rent, or borrow that are used in the insured’s business, including “autos” owned by employees, partners, or members of an insured’s household, but only while those non-owned “autos” are used either in the insured’s business or personal affairs.

Physical Damage Coverage Auto Symbols

1 = OWNED “AUTOS” ONLY. This symbol covers any “auto” owned by an insured, including any “auto” that is acquired after the policy begins.

2 = OWNED PRIVATE PASSENGER “AUTOS” ONLY. This symbol covers only private passenger type “autos” owned by the insured, including any private passenger type that may be acquired after the policy begins.

3 = OWNED “AUTOS” OTHER THAN PRIVATE PASSENGER “AUTOS” ONLY. This symbol covers all “autos” other than private passenger type “autos” owned by the insured, including any “autos” other than any private passenger type that may be acquired after the policy begins.

4 = SPECIFICALLY DESCRIBED “AUTOS”. Only those “autos” that are specifically listed on the policy are covered. The symbol also applies to any “trailer” while it is towed by a listed vehicle.

5 = HIRED “AUTOS” ONLY. This symbol covers only those “autos” that an insured leases, hires, rents, or borrows, unless the “auto” is leased, hired, rented, or borrowed from an employee, partner, or member of the insured’s household.

Manuscript Symbols

In some instances, a particular insurance company may agree to provide coverage for an auto situation that is not described in the above symbols. When this occurs, a special symbol, such as 10 for liability or 7 for physical damage coverage, is used and added to the policy by an endorsement. The endorsement must contain a complete explanation/description of what the symbol means. Then, that number must appear next to the applicable coverage(s).

If you have a question about any of these symbols or how coverage applies under your policy, the answers lie with the nearest insurance professional. Call them; they’re eager to help you understand your protection.