What Does Commercial Auto Insurance Cover and Why Do You Need It?
What if you failed to protect your business and it cost you everything? Here is a scenario to consider: Your employee is rushing to deliver some important parts when they hydroplane in a rain storm and slide into someone’s brand new Tesla. Worse, the Tesla driver is injured in the wreck.
Neither your personal car insurance policy or your employee’s coverage is likely to cover the ensuing fallout of costly repairs (or replacement) and medical bills.
For many businesses, commercial auto insurance is an absolute must-have. However, far too many entrepreneurs are unsure whether or not they need this specialized coverage. As a result, they do not find out how important it really is until one of their vehicles gets into an accident, resulting in major bills and serious lawsuits.
Do you actually need business vehicle coverage? How can you tell, and what does such a policy cover? By getting the answers to these questions, you can make the decisions that are best for you and your company. Keep reading to discover everything you need to know.
What Is Commercial Auto Insurance?
Commercial auto insurance is designed to protect companies that use vehicles for business purposes. Should one of those vehicles be involved in an accident, this policy provides liability coverage that will pay to cover damage to people and property for which one of your drivers may be found legally liable.
Not every company needs commercial auto insurance coverage because not every company relies on vehicles. If yours does, though, it is very important for you to take out such a policy to protect yourself against unknown future threats.
How It Differs from Personal Auto Insurance
How does coverage compare with commercial vs. personal auto insurance? Commercial vehicle insurance offers very similar protection to personal auto coverage. The key difference is that a personal policy will not pay out if the vehicle was being used for business purposes. In that case, the only way to achieve the necessary level of protection is via a commercial policy.
Who Needs Commercial Vehicle Coverage
In short, business vehicle coverage is necessary for any company that uses automobiles to conduct business. This includes companies that deliver food or that transport people (for example, rideshare drivers). It also includes companies that simply use vehicles to transport equipment, much of which might be expensive to replace in the event of an accident.
What Does Commercial Auto Insurance Cover?
Entrepreneurs on the fence about getting this policy often ask a simple question: “What does commercial auto insurance cover?” However, the answer depends on the exact policy that you get. A typical business auto insurance policy will provide at least the liability coverage to pay for damage caused by the driver and collision coverage to repair the company vehicle, no matter who is liable for the damage.
Blurring things further regarding commercial vs. personal auto insurance is that both policies allow you to add additional kinds of protections. For example, you may decide to add medical payments, uninsured motorist, or other additional protections to a business policy for maximum protection.
Liability Coverage for Business-Related Accidents
Liability commercial auto insurance coverage pays for damage caused to people or buildings by someone driving one of your company vehicles. This can protect entrepreneurs from having to pay expensive out-of-pocket bills that may threaten the day-to-day operations of the company in question.
Coverage for Physical Damage to Business Vehicles
The collision protection of a business auto insurance policy will pay for any repairs a vehicle needs after an accident. This policy pays out regardless of who was at fault for causing an accident, offering robust car insurance for delivery drivers and others using vehicles to conduct business.
Medical Payments, Uninsured Motorist, and More
Some entrepreneurs may wish to add additional protection to their work vehicle insurance. For example, medical payments coverage pays for the medical bills of the driver and any passengers.
An uninsured motorist policy provides additional coverage if one of your automobiles is hit by a driver who has insufficient coverage. Finally, a comprehensive policy protects the vehicle from damage that may occur when nobody is behind the wheel, including theft and weather-related damage.
Optional Add-Ons for Specialized Business Needs
You can further supplement work vehicle insurance with optional add-ons. This includes roadside assistance, which comes in handy in the event a work vehicle breaks down and needs towing, a battery jump-start, or additional fuel. A hired auto rider can protect vehicles that your company leases, and a non-owned auto rider provides protection for employees who occasionally use their personal vehicles on behalf of your business.
Why Commercial Auto Insurance Is Essential for Businesses
As you can tell, commercial auto policies offer many kinds of robust protection for entrepreneurs. But why is such a policy truly essential for your own business? Simply put, it is the only real automobile protection available to you in the event of an accident involving a company car.
Personal coverage will not protect such vehicles. Without a business policy, an entrepreneur might be stuck paying for the costs of any damages for which he or his employees are liable. In the case of a victim’s medical bills, those costs could be high enough to destroy the business altogether unless it has the proper protection.
Vehicles Generally Covered by Commercial Auto Insurance
Commercial auto insurance covers the vast majority of automobiles your business might use. With that being said, not every policy will cover every type of vehicle. Below, you will find more information on the kinds of transportation this policy protects.
Commonly Included Transportation Types
Most companies that use transportation rely on cars and trucks. A commercial policy should protect any such type of vehicle, but be sure to check with your carrier about what is and is not allowed.
Specialty and Niche Vehicle Inclusions
Beyond cars and trucks, commercial policies typically cover things like food trucks, box trucks, service utility vehicles, and work vans. As noted before, you should always ask your carrier whether your automobiles are properly covered. If not, there is no time like the present to switch to a better provider.
From Food Trucks to Fleets — Cover Your Business on the Road
Now you know everything about commercial auto insurance. This includes what it covers, how it differs from personal policies, and why it is so important. But do you know where you can find a provider just as committed as you to protecting your business?
At InsureOne, we are here today to protect your business from the threats of tomorrow. Ready to give yourself some peace of mind when it comes to your company? Once you are ready to experience the gold standard in both pricing and protection, come get a quote online. You can also always pick up the phone and give us a quick call at 800-836-2240. Finally, feel free to come find an InsureOne office near you.