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🔑 '''Entrustment''' is a legal doctrine relevant to [[Definition:Liability insurance | liability insurance]] that holds a person or entity responsible for damages caused by another party to whom they voluntarily transferred possession of property — most commonly a vehicle, equipment, or other instrumentality capable of causing harm. In insurance contexts, entrustment claims frequently arise under [[Definition:Commercial auto insurance | commercial auto]], [[Definition:General liability insurance | general liability]], and [[Definition:Umbrella insurance | umbrella]] policies when an employer or vehicle owner is alleged to have negligently allowed an unfit individual to operate the entrusted property, resulting in [[Definition:Bodily injury | bodily injury]] or [[Definition:Property damage | property damage]].

⚖️ A negligent entrustment claim typically requires the claimant to prove that the entrustor knew, or should have known, that the person receiving the property posed an unreasonable risk. In a commercial insurance scenario, this might involve a trucking company that allowed a driver with a history of DUI convictions to operate a fleet vehicle, or a contractor that lent heavy machinery to an unlicensed operator. [[Definition:Underwriting | Underwriters]] evaluate entrustment exposure by examining hiring practices, driver qualification files, [[Definition:Motor vehicle record (MVR) | motor vehicle records]], and equipment-use protocols during the [[Definition:Risk assessment | risk assessment]] process. When a negligent entrustment allegation is made, the insurer's [[Definition:Claims adjuster | claims adjuster]] must determine whether the [[Definition:Policy | policy]] responds and whether any [[Definition:Exclusion | exclusions]] — such as those for intentional acts — might apply.

🛡️ Negligent entrustment represents a significant source of [[Definition:Loss | loss]] severity in commercial lines, particularly in [[Definition:Trucking insurance | trucking]] and [[Definition:Fleet insurance | fleet]] programs where jury verdicts in the United States have escalated dramatically — a trend often described as [[Definition:Social inflation | social inflation]]. Insurers and [[Definition:Risk manager | risk managers]] mitigate this exposure through rigorous pre-employment screening, ongoing driver monitoring, and clear policies governing property use. From an [[Definition:Underwriting | underwriting]] standpoint, an applicant's entrustment controls can materially influence [[Definition:Premium | pricing]], [[Definition:Deductible | deductible]] structure, and even the decision to offer [[Definition:Coverage | coverage]] at all.

'''Related concepts:'''
{{Div col|colwidth=20em}}
* [[Definition:Negligence]]
* [[Definition:Vicarious liability]]
* [[Definition:Commercial auto insurance]]
* [[Definition:Social inflation]]
* [[Definition:General liability insurance]]
* [[Definition:Risk assessment]]
{{Div col end}}

Definition:Entrustment - Revision history

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