When Do You Need Commercial Auto Insurance?
Personal auto insurance is required for cars you drive regularly and for pleasure—but what about a vehicle you use for work? Or a fleet of vehicles your employees drive?
The usage and ownership of a vehicle generally dictates the type of auto coverage you will need. Make sure you, your business, and your employees are covered with a commercial auto insurance policy.
What Is Commercial Auto Insurance?
Commercial auto insurance is designed to fit your needs and help you protect the vehicle, or fleet of vehicles, you use to run your business efficiently. Commercial auto insurance covers accidents the occur while you or your employees are driving a company vehicle, or using a vehicle to facilitate business.
Personal and commercial auto policies offer similar coverages to protect the driver, passengers, car, and other parties involved, but a commercial policy typically has higher liability limits.
Related: All About Commercial Car Insurance
When Do I Need It?
If you regularly use your truck to conduct business, for example, or have vehicles purchased specifically for usage within the perimeters of your business, an extra layer of risk is attached. To account for this, insurers consider who will be driving the vehicle, how often, and the nature of the business usage.
If you purchase a vehicle used solely in business, like a delivery or transport vehicle, you’ll need higher commercial liability limits to cover the extra risk of carrying goods or passengers.
In terms of ownership, you should purchase commercial auto insurance if employees drive vehicles registered to your business, or their own as part of the business. If you rent or lease vehicles for business use, too, then a commercial auto policy is a necessity.
Personal & Commercial Auto Insurance
Even if you use a single vehicle for both personal and commercial use, you’ll need commercial auto. If the only “work” usage on your personal vehicle, though, is a daily commute to a single worksite or office, then you don’t need to opt for commercial coverage.
A good rule of thumb in determining the coverage you need is asking yourself: “Other than travelling to and from work, do I regularly need my vehicle to operate my business?” If so, contact your broker to discuss commercial auto insurance options!