Commercial Auto Insurance: What You Should Know

Commercial auto insurance is a special type of coverage that insurers offer to commercial vehicle drivers. This insurance prevents commercial drivers from paying out of their pockets for auto repair, property replacement, and legal and medical bills after an accident. The best commercial auto insurance depends on the specific needs of your company.

What Are the Best Commercial Car Insurance Companies in the USA?

The following are the best commercial car insurance companies in the United States:

Progressive (Overall Best Commercial Vehicle Insurance Company)

Progressive has already received the label of the number one truck insurer in the U.S., and it lives up to its name. This insurer provides coverage for a wide variety of cars and businesses.

Since Progressive covers all 50 U.S. states, policyholders can take trips to most states without having to buy temporary insurance. The insurer also grants off-season discounts to customers who go on holidays without taking their vehicle. To purchase an insurance policy with Progressive, order an online quote on the company’s website.

Nationwide (Best Commercial Car Insurer in Coverage Value)

In terms of coverage value, Nationwide is the best insurance company. Most of its insurance policies have a wide range of options for policyholders. Nationwide offers its insurance services in 46 U.S. states to owners of commercial vehicles like cargo vans and utility trucks, says

Some of the special features that Nationwide provides to commercial vehicle owners are roadside assistance and vehicle replacement coverages. It also provides multi-policy discounts and discounts for customers who pay their insurance premium in full. While Nationwide allows customers to check its insurance quotes online, you need to speak with a company representative to buy a policy.

Insurance Business America indicates that A.M. Best rates Nationwide an A+ in financial strength. Also, the insurer holds a number one rank in customer satisfaction, courtesy of the 2019 J.D. Power U.S. Small Commercial Insurance Study.

State Farm (Best Commercial Vehicle Insurer in Customer Service)

High customer satisfaction ratings and few customer complaints make State Farm the best commercial auto insurance company in customer service. According to the 2020 J.D. Power U.S. Small Commercial Insurance Study, State Farm is the second-best auto insurance company in the USA, says State Farm offers coverage options like bodily injury liability, collision coverage, and comprehensive coverage in its commercial auto insurance policy.

When employees drive company cars for business purposes, State Farm extends commercial auto insurance coverage on their employers to them. This feature is known as Employer Non-Owned Car Liability (ENOL). Rideshare drivers who cannot afford commercial auto insurance policies also enjoy additional rideshare coverage on their personal vehicle insurance.

Farmers (Best Commercial Auto Insurance Company for Single Vehicles)

If you only need one or two cars to conduct your business, you should consider getting a Farmers commercial vehicle insurance policy. Farmers insurance company specializes in providing affordable insurance policies to small businesses who use few cars for their commercial activities. This insurer’s coverage options include uninsured motorist coverage, comprehensive coverage, and coverage for stolen tools.

How Does Commercial Auto Insurance Work?

Vehicle insurers offer commercial auto insurance services to both employers and employees of commercial transport businesses. While some commercial auto insurance policies only cover liability, others may also provide coverage for collision, medical treatment bills, and Personal Injury Protection (PIP) costs.

Business owners and commercial drivers study the insurance options available before making payment for an insurance quote. With the help of a representative from their insurance company, they analyze the elements in each coverage option and choose the options that suit their needs.

Common elements in insurance policies are:

  • Monthly premium: A monthly premium is the amount of money that insured drivers pay to retain their insurance policy.
  • Coverages: Coverages are the list of expenses that an insurance company may cover when an insured vehicle is involved in an accident. Examples of coverages are auto repair bills and medical expenses.
  • Deductible: A deductible is an amount that insured businesses must pay the insurer to activate the coverages in their policy. Insured drivers pay deductibles out of their own pockets.
  • Policy limit: A policy limit refers to the highest sum of money that an insurance company can pay to protect a policyholder.

    Aspiring commercial policyholders should buy insurance policies that combine low deductibles with high policy limits and offer excellent coverages at affordable premium costs. After a commercial vehicle owner purchases an insurance policy, they start paying insurance premiums monthly. When the insured’s vehicle causes an accident, the insurer pays the customer’s repair and medical bills or any other coverage included in their policy.

    Why Do I Need Commercial Auto Insurance?

    You need commercial auto insurance to safeguard your business against financial loss. If any of your commercial vehicles causes an accident, victims may hold your company liable or even sue the business.

    A commercial auto insurance policy keeps you from paying for victims’ losses out of the company’s pocket. Instead, your insurance company will cover all medical expenses and auto repair bills of your victims. It may even pay for your vehicle repair bills, depending on the type of coverage in your insurance policy.

    Some businesses necessitate vehicle insurance. For instance, a catering business requires commercial vehicle insurance to protect them against financial loss due to food spoilage. Also, construction vehicles need insurance because they are more likely to cause massive damages during accidents, says Investopedia. Most U.S. states don’t allow drivers to operate commercial vehicles with personal auto insurance policies. If you start using a car to conduct a business, you must purchase commercial auto insurance before driving it legally.

    Who Needs Commercial Auto Insurance?

    If you reside in the U.S., chances are your state requires drivers to purchase an auto insurance policy before operating a vehicle. The type of auto insurance policy you buy will depend on your vehicle’s purpose.

    If your car fits any of the descriptions below, you should get a commercial auto insurance policy:

    • Your employees operate the car.
    • Your car is leased, owned, or rented by a business.
    • You don’t own the car, but you use it as a commercial vehicle.

      Check this out if you need additional information, resources, or guidance on car insurance.


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