A commercial auto insurance coverage covers what kinds of vehicles?
Box trucks, food trucks, labor vans, and service utility trucks are just a few examples of larger commercial vehicles that will require commercial auto insurance, which will cover the people who operate the vehicle as well as any equipment within. This insurance is also known as commercial auto insurance, commercial car insurance, truck insurance, or fleet insurance. While commercial vehicle insurance is most frequently associated with trucks or other well-known work vehicles, personal cars and autos may also require coverage if they are used for business.
What is the purpose of business vehicle insurance?
Personal auto insurance policies may prohibit certain commercial activities and vehicle types. Why? Personal auto plans are written and evaluated differently than business auto policies because they were not designed for businesses. More importantly to you, as a business owner or manager, commercial auto insurance policies often require specific coverages.
Determining whether you need commercial auto insurance is still a challenge. Here’s some more information and instances of when commercial insurance is necessary.
What is covered under business vehicle insurance?
Liability, collision, comprehensive, medical payments (or personal injury protection), and uninsured motorist coverage are all included in commercial vehicle insurance policies. There are certain distinctions between a business auto insurance policy and a personal auto insurance policy, such as eligibility, definitions, coverages, exclusions, and restrictions.
What Is Business Vehicle Insurance and How Does It Work?
As a business owner, you’ll need some of the same insurance coverages for your company’s cars, trucks, vans, and other vehicles as you would for your personal vehicles.
Your BOP does not cover autos, so you’ll need a separate policy.
Most states require you to get liability insurance to cover bodily injury and property damage that may occur as a consequence of a vehicle accident while you or someone from your company is on business. Most states require you to carry uninsured/underinsured motorist coverage and/or medical payments coverage (known in some states as Personal Injury Protection (PIP)). Physical damage coverage can also be purchased for vehicles that your company owns, leases, or rents.
Many insurers utilize the Business Auto Coverage Form (BACF) to provide commercial auto coverage. Autos are defined to include cars, trucks, trailers, vans, and other vehicles suited for use on public highways, despite the fact that the form simply mentions “autos.”
Each car you use for business might be “scheduled,” or included on your policy with its own set of coverages. In other words, based on the attributes of your various vehicles (size, age, theft rating, and safety rating) and the coverage you require, you can choose alternative coverages.
Do I Need a Commercial Auto Policy?
Your insurance agent will inquire as to how you use vehicles in your business, who will be driving them, whether you own, rent, or lease them, and whether you or your workers will be driving their own automobiles for work. The answers to these questions will reveal which forms of insurance you require.
In general, only a BACF can offer a business the kind of liability protection it requires. Many insurers recommend a business auto policy maximum of $1 million, with $500,000 as the minimum, in today’s litigious world, because even a tiny firm has to cover the possible damages in a major accident.