If you use cars, trucks, or vans to conduct business, then you need to have commercial auto insurance

Whether you use vehicles to deliver food or goods, transport materials or people, you need commercial auto insurance to protect your business and your employees. We’ve put together this primer on commercial auto insurance, so you understand who needs coverage, and what commercial insurance covers.

What is commercial auto insurance?

Everyone is required to have auto insurance for personal vehicles. Commercial auto insurance primarily does the same thing, only it is meant to cover any vehicle that is used in the course of business.

There are several different types of commercial coverage:

  • Bodily injury liability covers bodily injury or death from an accident in which you or an employee is at fault.
  • Property damage liability covers damages to another person’s car or property, as well as any legal expenses you may incur.
  • Medical payments, no-fault or personal injury coverage pays for medical expenses of the driver and passengers in your vehicle that result from a covered accident (regardless of fault).
  • Uninsured or underinsured motorist coverage pays for injuries or damages if you are involved in an accident with an uninsured or underinsured driver. This also covers injuries and damages caused by a hit-and-run driver.
  • Collision coverage pays for damage to your vehicle if it hits (or is hit by) another object, including a car or stationary object (tree, telephone pole, wall).
  • Comprehensive coverage pays for damage caused by a non-collision related incident such as weather, theft, or vandalism.

Who needs commercial auto insurance?

Commercial auto insurance is meant to cover any vehicle that you own, lease, hire, or use for business purposes. If you move goods or people across state lines, you are required by federal law to carry commercial insurance. Larger vehicles may need a specific commercial truck insurance policy.

You need commercial auto insurance for vehicles that:

  • Are used for business purposes
  • Have a commercial license plate or tag
  • Are registered as commercial vehicles

You may also need commercial auto insurance if you or your employees use vehicles for work-related tasks, such as:

  • Driving clients to meetings or the airport
  • Transporting goods/packages or taking packages to a shipper
  • Going on sales calls
  • Shopping for office supplies
  • Delivering food
  • Acting as a chauffer, taxi, or limo service
  • Transporting flammable or hazardous materials
  • Carrying equipment
  • Towing vehicles
  • Trucking or moving freight

What types of vehicles does commercial insurance cover?

A commercial vehicle is really anything that you use in the course of doing business. It can include box trucks, food trucks, work vans, passenger vans, and service utility trucks. However, a regular car or SUV may also be recognized as a work vehicle and require a commercial policy.

Who is covered by commercial auto insurance?

A commercial auto policy is meant to cover you and any employee who uses a company vehicle for business purposes, whether a car, van, or truck. It may also cover family members and/or other passengers in your vehicle who are not employed by your business.

What is covered by personal insurance vs. commercial insurance?

This is an area that can cause confusion for many people. What is covered by your personal auto policy versus a business policy? 

Do you need a commercial policy if:

  • You drive your personal vehicle to work or client meetings?
  • You’re dropping off equipment, a presentation, or goods for your boss or a client? 
  • You’re picking up doughnuts or bagels for the office?

In general, these activities should be covered under your personal auto policy.

The basic rule is that you need commercial insurance if you use that vehicle to do work. If part of your job description requires you to deliver, transport, or do any part of your job, then a commercial auto policy is usually required.

If you have any questions about what falls under a personal or commercial auto policy, ask your insurance agent.

Let us take care of your commercial auto needs

Commercial auto insurance is essential if you use vehicles for business purposes. It can protect you and your employees in the event of an accident or other incident that results in injuries or property damage (including to equipment or goods that you are transporting inside the vehicle).

Avante Insurance can help you secure the right commercial auto insurance as well as other types of commercial coverage for your business, including:

  • Commercial property
  • General liability
  • Workers’ compensation
  • Professional liability
  • Employment practices
  • Commercial umbrella

Contact us to talk about your commercial insurance needs and request a quote. We will ensure you have the right coverage to protect the business you’ve worked so hard to grow.

This blog and website are made available by the publisher for educational and informational purposes only. It is not to be used as a substitute for competent insurance, legal, or tax advice from a licensed professional in your state.