Originally Posted by InsCommentary
The corporation provides no protection against a personal injury lawsuit against an individual. If it did, everybody in America would incorporate as a corporation with no assets so they couldn't get sued hiding behind that corporate veil.
Years ago, I worked for a company where an employee rear-ended a vehicle with a pregnant woman driver who went into labor and miscarried. She sued both the corporation and him as an individual. If the corporate insurance had been insufficient, she would have gone after his insurance or assets. That could have been problematic because he had no auto insurance of his own.
I have a lot of respect for you, but I believe you completely missed what Dan is saying.
Assuming this is a genuine business, properly formed and current on all state filings, taxes, etc., then the business should insure the car. For the owner to personally insure a vehicle owned by the business co-mingles assets and voids all protection of having a corporation.
Now I understand what you are saying, by driving the vehicle the owner is still personally liable for his actions. And that is why Dan recommended high limits and an umbrella. It helps to avoid the very situation you are suggesting.
From a liability standpoint, this is why I am not a huge fan of sole-proprietors forming any type of limited liability entity. They cannot escape personal liability for their actions and there are no employees to behave badly cause liability for the business and owner. It may or may not help with taxes, depending upon the situation and state.
And of course, I'm not an attorney either.