When it comes to your business, the only risks you want to take are the necessary ones that pay off down the road. Skimping on insurance to cover your business and its assets isn’t one of those places.
The good news is a commercial auto policy doesn’t have to take a huge chunk out of your operating budget.
If you’ve been asking yourself, “What is commercial insurance?”, keep reading. We’ve got your comprehensive guide to commercial auto insurance below!
What is Commercial Insurance for Auto?
You might assume that your personal auto insurance covers the vehicles you drive for your business. Unfortunately, that isn’t true.
Even if you’re the main driver of the vehicle, a business-owned vehicle isn’t covered by personal insurance. If you have multiple vehicles operated by employees other than yourself, you need to have a commercial auto insurance policy. It also covers employees that drive their personal cars for your business.
Commercial auto insurance covers accidents, damages, and thefts associated with the vehicles tied to your business. It also covers physical injuries due to accidents. Different companies offer different coverages. Here are some common ones.
Combined Single Limit, or CSL
Most auto policies have specified limits for physical injury claims and property damage. But a CSL gives you the same coverage amount for each covered occurrence no matter the circumstances. And it covers both property damage and bodily harm for one or multiple people.
Uninsured Motorist Coverage
This covers an accident with your vehicle caused by an uninsured driver or a driver who causes a hit-and-run accident. This coverage will pay for their lack of insurance. It coverage includes property damage and physical injuries.
Comprehensive Physical Damage Coverage
If your vehicles are damaged by natural occurrences like floods or fires, this coverage will pay for the damage done to the vehicle. It also covers damage if your vehicle was the target of vandalism or theft.
Bodily Injury Liability Coverage
This coverage is in the event you or one of your employees physically injures another person or people in a car accident. It will deal with the legal responsibility of paying for the costs associated with the physical injuries they’ve incurred. Almost 1,000 people die in commercial accidents each year, and thousands more are injured. This coverage makes sure your company will be protected from those medical costs.
Property Damage Liability Coverage
If you or one of your employees damages another person’s property during an accident, this coverage will pay for those damages.
Collision Coverage
This coverage is for damages caused by a collision involving one of your commercial vehicles.
Personal Injury Coverage
No matter who is at fault in the accident, this coverage will pay for medical bills. It covers the driver and passengers inside your business vehicle during an accident.
Are There Special Coverages?
Commercial auto policies do offer some additional specialty coverages that personal policies do not. Many are add-on style riders to policies that vary based on business needs.
- Trailer interchange coverage, for trailers owned by others that your vehicles use
- Rental reimbursement, for the cost to rent a temporary replacement while your own vehicle is fixed
- Hired vehicle coverage, if you need to rent a car for clients or your employees
- Non-owned vehicle coverage, or special coverage for employees using their own cars while conducting your business
Ensure you do your research and talk to your insurance agent about the best options for your particular situation and business needs.
How Much Does Commercial Auto Insurance Cost?
Commercial auto policies are priced according to multiple factors.
- Location
- Types of vehicles insured
- Number of employees driving
The best way to know for sure is to get in touch with a company that specializes in commercial auto insurance to discuss your needs and get a quote!
How is Commercial Auto Insurance Different From Personal Auto Insurance?
Commercial auto varies from personal auto insurance in a few way.
Commercial policies typically have higher liability limits than personal auto policies, meaning better coverage.
Commercial insurance is also completely tax-deductible as a business expense. Personal insurance is only partially deductible, even if you’re using your car for business.
Commercial policies can either offer individual insurance for specific employees or act as a blanket style coverage for all your employees. Personal insurance only covers the specific person who has the coverage.
Finally, commercial policies offer additional coverage that personal policies don’t include, such as trailer and forklift insurance.
Does Your Business Need Commercial Auto Insurance?
There are several types of businesses that need commercial auto insurance. The most straightforward is any business that has employees who drive. This could be in cars that are leased, owned, or rented by the company.
But there are a few other types of businesses that also need to consider commercial auto insurance.
If you have a business that owns, rents or leases vehicles you’ll want commercial insurance to protect your fleet cars. This would include businesses such as rental companies and car dealerships,
Further, a business that has employees who drive their own personal cars around for company business should have commercial auto insurance. Your business needs to provide auto insurance if that vehicle is being driven around for business reasons.
What Vehicles Can You Insure?
The types of vehicles covered by commercial policies vary as widely as the types of businesses that operate them. General commercial policies cover most normal vehicles. Specialized coverages exist to cover all manner of business vehicles.
From small commuter style cars to specialized trucks that haul cargo or are involved in construction work – if it has wheels and an engine, it can likely be covered by a commercial policy.
Get Your Commercial Auto Insurance Today!
If you’ve been wondering, “What is commercial insurance?”, and you’ve decided it’s time to get off the fence and make sure your company is protected, we’ve got you covered – literally!
Give Amistad Insurance Services a call today and let us give you a free quote for your commercial auto insurance needs.
