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If you use your vehicle for business purposes or own a business with vehicles, you’ll likely want to learn about commercial auto insurance.
Driving to and from your job does not qualify you, but using your vehicle for deliveries could. Depending on the type of coverage you need, there is a wide range of different categories and plans to choose between.
Many automobiles are suited for commercial auto insurance, including the following common types:
- Cars, vans, SUVs, and small trucks
- Large trucks, including box, specialty, and dump trucks
- Trailers in a variety of sizes and types
While these are the most common types that may need this type of policy, this is only a small list. If you are interested in a more exhaustive list, a commercial auto insurance company such as Frost & Remer can help you determine what coverage is needed for your business.
Understanding commercial auto insurance
While commercial auto is similar to personal auto insurance, there are some key differences. Commercial auto insurance was designed to meet the specific and complex needs of businesses. It protects business owners, their companies, and employees.
Unlike a personal automobile insurance policy, a commercial auto policy is typically tax-deductible, which is a nice perk for business owners.
Collision and higher liability coverage are included in commercial auto insurance policies. These are beneficial because if an accident occurs, both the driver and other driver’s medical and repair costs will be covered. This protects a business from significant financial risks, as they would otherwise have to find other ways to cover such expenses should an accident occur.
If you use your vehicle for business, such as for making deliveries, running errands, or traveling for long distances, you could also potentially qualify for commercial auto insurance. Typically, you can for any job where you use your vehicle for business.
What does commercial auto insurance cover?
Accidents, road hazards, weather hazards, theft, and vandalism happen. With commercial auto insurance, your vehicles and those driving them will be protected when it comes to medical and repair costs.
If the other driver is injured and their vehicle is involved in a collision, your insurance policy will be able to cover their medical and repair costs as well. This ensures that neither party has to pay out pocket or fall into debt over an accident.
Two common coverage types
The two most common types of commercial auto policies are physical damage and liability coverage.
Physical damage coverage
- Collision loss: Damage from auto accidents
- Comprehensive loss: Damage from non-collision causes, such as weather, fire, vandalism, and theft
- Bodily injury coverage: For accident-related injuries to other drivers, when you’re at fault
- Property damage coverage: For accident-related damage to someone else’s property, when you’re at fault
Additional coverage types
Depending on your needs, you may also want to add the following common types of coverage to your policy:
- Rental reimbursement: If you are in an accident, your policy will cover a rental car so that you will not have to go without transportation.
- Uninsured or underinsured motorist coverage: If the at-fault driver does not have liability insurance, or enough to cover your expenses resulting from an accident, you will still be protected through your commercial auto insurance policy.
- Personal injury and medical payments coverage: This pays for medical expenses if you or your passenger’s health care insurance does not cover the costs.
Commercial auto insurance has several add-ons, which may be the most beneficial?
Your complex and specific business needs are met with customizable commercial auto insurance coverage.
You can choose whichever add-ons will benefit your specific business needs. What you prefer to add on may vary, depending on how often your vehicle is driven and what it is used for. For example, vehicles that are used often may need more coverage than vehicle’s that are driven less.
These add-ons include the following types of beneficial coverage.
Your policy may not cover all types of roadside assistance. With this add-on, you or your employee will receive help in the event of a flat tire, a battery dying, or getting locked out of the vehicle.
New vehicle replacement cost coverage
In the case of a total loss due to a crash or vandalism, your vehicle will be replaced with the same vehicle or a comparable one.
Auto loan or lease coverage
If your vehicle is a total loss after an accident, the difference between the unpaid amount on the lease or loan will be covered.
This add-on covers more than your typical towing that is offered with most policies. It includes jump-starts and minor roadside repairs as well.
How Frost & Remer can help
Finding the right insurance policy is an important aspect of your business. Frost & Remer can help you find a policy that protects you, your business, your assets, and your workers, while still being affordable.