Is commercial auto insurance required for your small business?
If your business has a car, you’ll almost certainly require commercial auto insurance. For business-owned automobiles, nearly every state mandates commercial auto insurance coverage.
Only New Hampshire and Virginia do not require drivers to get auto insurance. Drivers are, however, still liable for any harm they cause.
It’s a good idea to have business auto insurance even if it’s not needed. You could end up paying thousands of dollars in medical bills and other expenses if you don’t have it.
What is covered by commercial auto insurance?
Medical bills and property damage caused by an accident are covered by commercial auto insurance. If you are sued, this coverage includes legal fees. Vehicle theft, vandalism, and other losses and damages may be covered under a policy.
Liability insurance is typically included in commercial auto policies to cover your company’s legal expenses if one of your employees is involved in an accident.
Does your commercial auto insurance cover both your employees’ and your own personal vehicles?
Personal vehicles are not covered by commercial auto insurance. Consider purchasing hired and non-owned auto insurance if you or your workers occasionally drive personal cars for professional purposes.
Hired and non-owned auto (HNOA) insurance covers the automobiles that your company utilises but does not own. This comprises:
- Employee-owned automobiles
- A company’s leased vehicles
- A company’s rented vehicles
What makes commercial and personal auto insurance different?
Commercial auto insurance is designed for commercial vehicles that travel a great deal. To account for the greater risk, policies often have larger coverage limits.
Personal auto insurance policies only cover claims for personal use, such as your commute and non-work trips. They usually have lower restrictions and are less expensive.
Your insurance provider may deny your claim if you’re in an accident while driving your personal automobile for business. That’s why independent contractors and single proprietors with a work vehicle should consider commercial auto insurance or HNOA.
Consult an insurance representative if you’re unsure which policy you require.
Learn more about the distinctions between personal and business auto insurance.
What is the cost of commercial auto insurance?
The cost of commercial auto insurance is determined by several factors, including:
- Vehicles available
- Type and value of the vehicle
- Risk level involved
- History of Claims
- Driving records of employees
- Deductibles and policy limits
Commercial auto insurance costs an average of $142 per month.
Insureon small business customers pay less than $125 per month for their plans, according to 44%.
What kind of coverage should be included in a commercial auto policy?
Your policy must, at the very least, meet state regulations. Your coverage should also be able to cover all accident-related expenses. Otherwise, you may have to pay for legal fees and other charges yourself.
Speak with an agent to learn about policy alternatives that are right for you. Options that address various threats include:
Collision coverage, which protects your own vehicle in the event of an accident.
Vehicle theft and damage from vandalism, fire, and other causes are covered under comprehensive coverage.
Uninsured or underinsured motorist coverage protects you from damage caused by another driver who isn’t properly insured.
By increasing your deductible, you may keep the cost of your commercial auto policy under control. A coverage with a higher deductible will be less expensive, but you’ll have to pay more before you can receive benefits.