What You Need to Know

Cheap commercial auto insurance is ideal for people who use their vehicles for business activities. There are several insurance providers that offer affordable commercial auto insurance, but you can get a better deal if you compare rates before buying. In this article, we discuss the basics of getting cheap commercial vehicle insurance policies.

What Is Commercial Auto Insurance?

Commercial auto insurance provides coverage for vehicles used for business activities. It covers property damage, medical bills, repairs, and liabilities that your commercial vehicles might incur during an accident.

What Is the Coverage Provided in Commercial Auto Insurance?

According to Construction Coverage, commercial insurance provides the same coverage as personal auto insurance policies. However, the coverage is designed specifically for vehicles used for business operations. Insurance providers also have special policies for different commercial vehicles, such as cement mixers, trucks, and trailers.

Who Should Get a Commercial Auto Insurance?

Insureon says you should buy commercial auto insurance if you use a personal vehicle for business purposes or you own a vehicle dedicated to business operations. Doing so ensures that you have a policy that can protect your vehicle, your business, and yourself from liabilities while on the job.

How Does Commercial Auto Insurance Work?

Businesses can buy commercial auto insurance for a single vehicle or an entire fleet. You can determine the level of coverage you want before purchasing the policy. The following are some elements of the policy you need to discuss with your insurance agent before buying a policy:

  • Coverage: This determines the damages, incident, and expenses the policy will cover.
  • Policy limit: Defines the maximum amount of money the insurance company will pay you if you file a claim on the policy.
  • Deductible: This defines the amount your business will pay out-of-pocket before the insurance company provides coverage.
  • Monthly premium: This is the monthly payment for holding the policy.

    As a business owner looking to buy commercial auto insurance, choose a policy that provides sufficient protection and policy limits with affordable deductibles and low monthly premiums. Like personal insurance policies, when you buy a commercial auto insurance policy, you’re expected to pay monthly premiums. The insurance company is expected to cover payments for any repairs, damages, medical treatments, or legal expenses resulting from an accident involving one of your vehicles.

    If your commercial vehicle is involved in an accident or collision that is covered under the policy, you can report your losses by filing a claim with the insurance company. It is important to file your claim within a few days of the accident to avoid having your claim denied. In case the damage from a covered accident exceeds the policy’s deductible, the insurance company will still have to pay for damages up to the limit of your policy.

    What Protocols Are Followed by Insurers When Settling a Claim?

    According to Construction Coverage, here are some practices you can expect from insurance providers while settling a claim:

    • Some insurance providers require commercial vehicle insurance policyholders to use certified auto repair shops for their assessments and repair of damages. The insurance company will pay the shop directly, and you will pay the deductible for the work done. In most cases, these arrangements can save you time and money.
    • Insurance companies may also require you to get quotes from multiple auto repair shops if those shops are not part of their certified network.
    • Insurance companies may also send their agents to assess the damages and repair costs before approving the estimate from a repair shop.
    • Sometimes, insurance companies may wait until you’ve paid your premium before reimbursing you for the cost of repairs. This is not a good arrangement because it can disrupt your business operations.

      Who Needs Commercial Auto Insurance?

      A vehicle that falls under any of the following categories will likely need commercial auto insurance, according to Direct Auto:

      • A vehicle owned, leased, or rented by a business
      • An employee-operated vehicle
      • A vehicle used to perform business operations by an entity that is not the owner

        If your employees use personal vehicles for occasional business activities, a personal auto insurance policy will do. However, if they use the vehicle frequently for business activities, you may need to buy a commercial auto insurance policy for them. This is important because the insurance company may not pay for claims if the vehicle had an accident while the employee was using it to complete an official task.

        What if the Business Transports Products or People Across State Lines?

        If your business moves products or people across state lines, your company is required to meet the Federal Motor Carrier Insurance requirements. These requirements are enforced by the Federal Motor Carrier Safety Administration.

        What Is Covered Under Commercial Auto Insurance?

        Commercial auto insurance covers a wide range of personal and company vehicles. These policies can cover:

        • Sedans
        • Pickups and SUVs
        • Vans
        • Trucks
        • Delivery vans
        • Cranes, haulers, and cement mixers
        • Flatbeds
        • Tractor trailers

          What Coverage Is Included in Commercial Auto Insurance?

          Here are the coverages included in commercial auto insurance:

          Bodily Injury Liability Coverage

          Commercial auto insurance often includes bodily injury liability coverage if your driver is the at-fault party in an accident. Depending on the coverage and insurance company, body injury liability coverage can cover the cost of medical expenses, legal expenses, lost wages, and funeral costs.

          Property Damage Liability Coverage

          This component of commercial auto insurance covers the cost of repairing the damage or replacing another person’s vehicle or property damaged in an accident with a covered driver. Buildings, vehicles, fencing, and other physical structures are some of the things covered under property damage liability.

          Physical damage protection

          This part of the policy will cover the cost of repairing or replacing the policyholder’s vehicle or property that was damaged in a covered accident. Physical damage coverage can be limited to collisions, comprehensive, and limited comprehensive, depending on the terms of your policy.

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

          Sources:

          https://www.insureon.com/small-business-insurance/commercial-auto

          https://constructioncoverage.com/commercial-auto-insurance

          https://www.directauto.com/our-products/commercial-auto-insurance

          https://www.caranddriver.com/car-insurance/a35866075/small-business-auto-insurance/

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