20 Things to know about Commercial auto insurance

Commercial auto insurance is essential for businesses that rely on vehicles for their operations. Here are 20 important facts about commercial auto insurance:

1. Coverage Types: Commercial auto insurance typically includes liability, collision, comprehensive, medical payments, uninsured/underinsured motorist coverage, and sometimes hired/non-owned vehicle coverage.

2. Liability Coverage: This is crucial for protecting your business against claims for bodily injury and property damage caused by your vehicles.

3. Collision Coverage: Pays for damage to your business vehicles resulting from collisions with other vehicles or objects, regardless of fault.

4. Comprehensive Coverage: Covers damage to your vehicles from non-collision incidents such as theft, vandalism, fire, or natural disasters.

5. Medical Payments: Covers medical expenses for injuries sustained by the driver and passengers in your business vehicle, regardless of fault.

6. Uninsured/Underinsured Motorist Coverage: Protects your business if your vehicle is involved in an accident with a driver who has insufficient or no insurance.

7. Hired/Non-Owned Vehicle Coverage: Provides liability coverage for vehicles your business rents or borrows, and for employees’ vehicles used for business purposes.

8. Higher Liability Limits: Commercial auto policies often have higher liability limits than personal auto policies due to the increased risk and potential for larger claims.

9. Customization: Policies can be tailored to meet the specific needs of different businesses, including the type and number of vehicles, and the nature of their use.

10. Required by Law: In most states, businesses are required to carry commercial auto insurance if they use vehicles for business purposes.

11. Driver Exclusions: Policies may exclude coverage for certain drivers based on their driving history or other risk factors.

12. Fleet Insurance: Businesses with multiple vehicles can get fleet insurance, which can be more cost-effective than insuring each vehicle separately.

13. Deductibles: Commercial auto insurance policies come with deductibles that the business must pay out-of-pocket before the insurance coverage kicks in.

14. Premium Factors: Premiums are influenced by factors such as the type of vehicles, their use, the driving records of the employees, and the location of the business.

15. Coverage for Equipment: Some policies offer coverage for equipment permanently installed in the vehicles, like GPS systems or specialized tools.

16. Non-Owned Vehicle Coverage: Protects against liability when employees use their personal vehicles for business purposes, such as making deliveries or visiting clients.

17. Commercial Auto Insurance vs. Personal Auto Insurance: Commercial auto insurance typically offers broader coverage and higher limits than personal auto insurance to account for the higher risks involved in business use.

18. Claims Process: The claims process for commercial auto insurance can be more complex, involving multiple parties, detailed investigations, and potentially higher settlements.

19. Risk Management: Businesses can lower their premiums by implementing risk management practices, such as driver training programs and regular vehicle maintenance.

20. Insurance Requirements for Leased Vehicles: If your business leases vehicles, the leasing company may require you to carry specific insurance coverages and limits.

Understanding these facts can help businesses make informed decisions about their commercial auto insurance needs, ensuring they are adequately protected while optimizing their insurance costs.