Frequently Asked Questions About Commercial Auto Insurance
If you own or operate a business that relies on vehicles to transport goods, employees, or clients, you need to consider getting commercial auto insurance.
This type of insurance coverage provides protection for your business in case of accidents, injuries, or property damage caused by your commercial vehicles. Here are the frequently asked questions about commercial auto insurance.
What is Commercial Auto Insurance?
Commercial auto insurance is a type of insurance policy that provides coverage for vehicles used for business purposes. It can cover liability, collision, comprehensive, and uninsured/underinsured motorist coverage. It is purchased by companies that have a fleet of vehicles or individuals who use their personal vehicles for work-related activities.
How does Commercial Auto Insurance differ from Personal Auto Insurance?
Commercial auto insurance differs from personal auto insurance in that it covers vehicles primarily used for business purposes. They also tend to have higher coverage limits and premiums and may include coverage for tools, equipment, and employees.
Personal auto insurance covers vehicles primarily used for personal use.
What is not covered by Commercial Auto Insurance?
Commercial auto insurance typically does not cover intentional acts of the driver, such as criminal behavior or intentionally causing an accident. Other exclusions may include damage caused by war, nuclear events, or natural disasters.
Some policies may also exclude coverage for certain types of vehicles or industries, such as the transportation of hazardous materials. It’s important to carefully review your policy to understand what is specifically excluded from coverage.
Do I need Commercial Auto Insurance if I use my personal vehicle for business purposes?
If you use your personal vehicle for business purposes, you may need commercial auto insurance. This is because personal auto insurance policies typically exclude coverage for accidents that occur while using the vehicle for business purposes.
The extent to which you need commercial auto insurance depends on the nature of your business activities and how frequently you use your personal vehicle for those activities.
For example, if you occasionally use your personal vehicle to run errands for your business, you may be able to add a “business use” endorsement to your personal auto insurance policy. However, if you frequently use your personal vehicle for business purposes or if you transport goods or passengers, you will likely need a commercial auto insurance policy.
How much does Commercial Auto Insurance cost?
The cost of commercial auto insurance varies depending on factors such as the type of vehicle, number of vehicles, location, driving record, coverage limits, and deductibles. On average, premiums range from $1,200 to $2,400 per year per vehicle but can be higher for high-risk businesses or industries. It’s important to obtain quotes from multiple providers and ensure adequate coverage with an agent or broker.
Can I get Commercial Auto Insurance if I have a poor driving record?
Yes, you can get commercial auto insurance even if you have a poor driving record, but it may be more difficult and expensive. Insurance companies consider your driving history when determining your risk profile and the cost of your policy. If you have a history of accidents or traffic violations, you may be considered a high-risk driver and could face higher premiums or a more limited selection of coverage options.
Are there any exclusions or limitations to Commercial Auto Insurance coverage?
There are exclusions and limitations to commercial auto insurance coverage. The specific exclusions and limitations may vary depending on the insurance provider and the policy, but some common exclusions and limitations include:
- Intentional Acts:
Commercial auto insurance policies typically do not cover intentional acts, such as intentionally causing an accident or driving under the influence of drugs or alcohol.
- Employee Injuries:
While commercial auto insurance may cover damage to employees’ vehicles, it typically does not cover injuries sustained by employees while driving or riding in a company vehicle. Workers’ compensation insurance may provide coverage for these types of injuries.
- Non-owned Vehicles:
Commercial auto insurance policies typically only cover vehicles that are owned or leased by the business. If an employee uses their personal vehicle for business purposes, the employee’s personal auto insurance policy would typically be responsible for covering any accidents.
- Cargo:
Some commercial auto insurance policies may exclude or limit coverage for damage to cargo being transported in the vehicle.
- Uninsured or Underinsured Motorists:
Some commercial auto insurance policies may not include coverage for accidents involving uninsured or underinsured motorists.
It’s important to carefully review the terms and conditions of your commercial auto insurance policy and speak with your insurance provider to understand the specific exclusions and limitations of your coverage.
How do I determine how much commercial auto insurance coverage I need?
To determine how much commercial auto insurance coverage you need, consider the following factors:
- Legal Requirements:
Each state has its own minimum liability insurance requirements for commercial vehicles. Make sure you meet these legal requirements.
- Vehicle Type and Use:
The type of vehicle you have and how it’s used can impact the amount of coverage you need. A larger or more expensive vehicle may require higher coverage limits, and vehicles that are used for high-risk activities may require additional coverage.
- Business Assets:
Consider the value of your business assets and how much coverage you would need to protect them in the event of an accident or other incident.
- Risks and Liabilities:
Identify potential risks and liabilities associated with your business activities and determine how much coverage you would need to protect against them.
- Budget:
Finally, consider how much coverage you can afford and balance this with the level of protection you need.
Can I insure multiple vehicles under a single Commercial Auto Insurance Policy?
Yes, it is possible to insure multiple vehicles under a single commercial auto insurance policy. In fact, insuring multiple vehicles under one policy is often more cost-effective than insuring each vehicle separately.
When insuring multiple vehicles under a commercial auto insurance policy, you will typically need to provide information about each vehicle, such as the make and model, year, VIN number, and intended use.
It’s important to ensure that your policy includes coverage for all the vehicles you intend to use for business purposes.
How do I file a claim under my Commercial Auto Insurance Policy?
To file a claim under your commercial auto insurance policy, contact your insurance provider as soon as possible. Provide necessary documentation such as police reports. Cooperate with the adjuster’s investigation, and work with your insurance provider and agent to resolve the claim.
Does Commercial Auto Insurance cover the vehicle’s cargo in the event of an accident?
It depends on the specific coverage in your commercial auto insurance policy. Generally, commercial auto insurance provides coverage for damage to the insured vehicle, as well as liability coverage for bodily injury and property damage to others.
However, coverage for the vehicle’s cargo may not be included in the standard policy and may require additional coverage, such as cargo insurance or inland marine insurance.
It’s important to review the specific details of your commercial auto insurance policy to understand what is covered and what is excluded. If you frequently transport valuable cargo or equipment, it may be worth considering additional coverage options to ensure that your assets are protected in the event of an accident or other incident.
Can I get Commercial Auto Insurance for a vehicle that I only use occasionally for business purposes?
Yes, it is possible to get commercial auto insurance for a vehicle that you only use occasionally for business purposes.
When determining the appropriate level of coverage for your occasional-use vehicle, consider factors such as:
- The type of business you operate
- The frequency and duration of business use
- The value of the vehicle and its cargo
You may also want to consider additional coverage options, such as cargo insurance or inland marine insurance, to ensure that your assets are fully protected in the event of an accident or other incident.
Does Commercial Auto Insurance cover accidents that occur outside of the United States?
Some policies may include coverage for accidents that occur outside of the U.S., others may exclude coverage altogether or require additional coverage to be purchased.
If your business involves international travel or transport, it’s important to review the details of your commercial auto insurance policy to understand what is covered and what is excluded.
You may need to purchase additional coverage, such as international auto insurance, to ensure that your vehicles and drivers are fully protected in the event of an accident or other incidents while operating outside of the U.S.
Can I get a Commercial Auto Insurance Policy for a new business with no prior insurance history?
Yes, it is possible to get a commercial auto insurance policy for a new business with no prior insurance history. Many insurance providers offer coverage options for businesses of all sizes and types, including those that are just starting out.
When applying for commercial auto insurance coverage as a new business, you may be asked to provide information such as your business’s name and contact information, the types of vehicles to be insured, the intended use of the vehicles, and the driving history of any drivers who will be operating the vehicles.
Does Commercial Auto Insurance cover damages caused by an uninsured or underinsured driver?
Many commercial auto insurance policies include coverage for damages caused by uninsured or underinsured drivers, although the specific terms and limits of coverage may vary depending on the policy.
Uninsured motorist coverage (UM) and underinsured motorist coverage (UIM) are two types of coverage that may be included in a commercial auto insurance policy.
UM coverage provides protection if your vehicle is involved in an accident with an uninsured driver.
UIM coverage provides protection if your vehicle is involved in an accident with a driver who has insurance but not enough coverage to fully compensate for your damages.
Can I get a Commercial Auto Insurance Policy for a fleet of vehicles that will be used for different types of business purposes?
Yes, it is possible to get a commercial auto insurance policy that covers a fleet of vehicles used for different types of business purposes. Many insurance providers offer coverage options that can be tailored to the specific needs of your business, whether you have a fleet of vehicles that are used for deliveries, transporting passengers, or other commercial purposes.
When applying for commercial auto insurance coverage for a fleet of vehicles, you will typically be asked to provide information such as:
- The make
- The model
- Year of each vehicle
- The number of vehicles in the fleet
- The intended use of each vehicle
- The driving history of any drivers who will be operating the vehicles
Does Commercial Auto Insurance cover injuries sustained by the driver or passengers in the event of an accident?
Yes, many commercial auto insurance policies include coverage for injuries sustained by the driver and passengers in the event of an accident.
Commercial auto insurance typically includes two types of coverage for bodily injury: liability coverage and personal injury protection (PIP) or medical payments coverage (MedPay).
Liability coverage: provides protection if you or one of your drivers is found to be at fault for an accident that results in injuries to others.
PIP or MedPay coverage: provides protection for medical expenses, lost wages, and other costs associated with injuries sustained by you or your passengers in the event of an accident, regardless of who is at fault.
The specific terms and limits of coverage for bodily injury may vary depending on the policy, so it’s important to review the details of your commercial auto insurance policy carefully to understand what is covered and what is excluded.
How can I get a discount on my Commercial Auto Insurance?
To potentially get discounts on your commercial auto insurance policy, you should:
- Maintain a safe driving record
- Bundle multiple policies with the same provider
- Equip your vehicles with safety features
- Provide driver training programs
- Consider payment plans
- Drive low mileage
- Have a large fleet size
What are the requirements for Commercial Auto Insurance?
Commercial auto insurance requirements vary by state and the type of vehicle being insured. In general, most states require commercial vehicles to carry liability insurance, which covers damages and injuries caused to others in an accident.
Some states also require uninsured or underinsured motorist coverage, which protects you in the event of an accident with a driver who doesn’t have insurance or doesn’t have enough insurance to cover the damages.
Additionally, if your commercial vehicle is financed or leased, the lender or leasing company may require you to carry collision and comprehensive coverage to protect their investment in the vehicle. It’s important to check with your state’s insurance department and consult with an insurance agent to determine the specific requirements for your commercial vehicle.
Where can I get Commercial Auto Insurance?
Commercial auto insurance is offered by many insurance companies, including large national providers and smaller regional or local carriers.
You can start by researching and comparing quotes online or by contacting an independent insurance agent who can provide you with multiple quotes from different carriers.
It’s important to consider factors such as the carrier’s financial strength, customer service reputation, and coverage options when choosing a commercial auto insurance provider.
Additionally, some professional organizations and trade associations offer commercial auto insurance programs that are tailored to specific industries or professions, so it’s worth checking to see if there are any specialized options available that may better fit your needs.
Commercial auto insurance is an essential investment for businesses that rely on their vehicles to operate. Protect your business and your assets with comprehensive commercial auto insurance. Contact or email ONYX Insurance Brokers to get your free Commercial Auto Insurance quote!
