Assured Standard Logo

Do You Need a Commercial or Personal Auto Insurance Policy

Do You Need a Commercial or Personal Auto Insurance Policy?
by Arthur Williamson

Seeing as how cars have become so important, it's no surprise to see so many options for the average car owner. Of course, auto liability coverage is important all the time. The problem begins when you start talking about commercial auto policies and thinking they'll be the same thing.

Commercial auto insurance is something that the everyday consumer doesn't think about. Because of that, misconceptions have come about making things a little more confusing for some.

Differentiating Commercial vs Personal Auto Insurance Policies

Similar to how your home insurance will have different expenses versus an insurance policy for your business, an insurance company will treat a commercial car differently from a privately owned vehicle.

This is largely due to the wear and tear that business vehicles experience over time coupled with the frequency of use. Think of all those FedEx trucks driving around the whole day. This increased utilization will only decrease the lifespan of the vehicle, underscoring the importance of having commercial auto insurance policy.

Further, the purposes of the car with regards to the operation of the business will undoubtedly be different from a private vehicle. Not to mention the possible loss in revenue should a business vehicle break at the wrong time.

Of course, things like bodily injury will be a common thing, although the bodily injury of an employee will have different rates than that of a family member.

As such, can expect the following to be factors:

  • Company services
  • Type of car or semi-trucks or tractor-trailers
  • Number of company cars
  • Gross vehicle weight
  • Driving record of employees
  • Types of products

Of course, each commercial auto policy will have its own set of rates, conditions, and terms just like your average business insurance.

Who Needs Commercial Auto Insurance Policies?

Business owners in charge of services which include the use of cars should definitely plan for commercial liability insurance. This is due to the risks as well as the stakes involved when it comes to company vehicles.

The average commercial auto insurance covers most events that may occur during the operations of your business. Commercial vehicle insurance includes:

  • Property damage due to the company vehicle
  • Collision coverage
  • Any damage to your vehicle
  • Medical expenses incurred due to the company car

As mentioned, the kind of vehicles involved will be a huge factor. The common sedan will incur different rates when compared to box trucks. Don't let this surprise you when you ask your agent for a quotation.

What Do Commercial Policies Cover?

The thing is, looking for an auto insurance policy might not be new to you, but that doesn't mean that choosing the right commercial auto policy will come easy. A big factor here would be the level of coverage the customer can get with their commercial car insurance.

Basic

This is the closest thing you can get to a basic insurance policy wherein the individual or organization named in the policy will be the only one covered.

Permissive

Permissive insurance will increase the grasp of the insurance coverage to include any individuals you give permission to use your vehicles. This will include any company drivers you employ to drive your vehicles.

Omnibus

Any auto insurance policy that falls under this category tends to be under comprehensive coverage. At this level, auto insurance includes those that may be held responsible by the insurance bearer. Basically, if you were managing your company deliveries, even your boss should be covered by your commercial auto policy.

Frequently Asked Questions

How much does a commercial auto policy cost?

The idea of paying a premium on multiple vehicles might scare people off. Rest assured, many commercial auto insurance providers will cater to small businesses. Just remember that your premium dictates the kind of coverage you get.

On average, you can expect to pay between $900-$1,200 per year for commercial auto insurance. With a clean driving record, you can expect about $1,000,000 in liabilities and about $500 deductible from comprehensive coverage and collision coverage.

Keep in mind that your commercial auto insurance policy can be affected either positively or negatively by:

  • Area of operations
  • Frequency of deliveries
  • Driving records of employees
  • Vehicles exceeding their rated weight limit.

Who has the best commercial auto insurance?

Of course, a few exemplars of fair pricing and reliable claims service will stand out. The following have made a name for themselves in the industry of commercial auto insurance coverage.

1. Progressive Insurance

Well established as one of the most popular auto insurers in the U.S., Progressive Insurance is highly rated in terms of its policy offerings as well as customer experience. They offer auto coverage for both small and large business vehicles, including trailer trucks.

2. Liberty Mutual Insurance

Another highly rated insurance firm, Liberty Mutual Insurance is well known for having exemplary vehicle insurance policies for both small business ventures as well as large-scale company fleets. Their expertise comes from over a century's worth of experience in the business.

3. State Farm

Known for the positive feedback from its customers, State Farm is another well-established insurance company best for any business auto insurance needs. Scoring an A++ with A.M. Best, State Farm has been in business with organizations ranging from religious groups to medical companies.

Additional Resources

As you do your research, the jargon of the industry can get a little confusing for others. What might help are a few resources to gain more insight and information.

HowMuch

While the site doesn't specifically cater to auto insurance, HowMuch hosts a bevy of educational content that targets the topic head-on. You'll find that their collection of articles can be helpful when researching something like motorist coverage and what that might entail.

OneResource

A financial consulting firm established more than 20 years ago, One Resource has collected a lot of experiences and is willing to share these through content on their site. Here, you can find articles, presentations, and videos on insurance.

The bottom line here is that like needing insurance for a home, your company vehicle needs to have commercial vehicle insurance as well. Like we said, auto insurance is pretty much a necessity these days. To learn more about auto insurance and its components, visit AssuredStandard.com today!

assured standard logo
Assured Standard will protect your business with the right insurance, depending on your needs. Now more than ever, it’s crucial to have the right general liability insurance experts on your side. Protecting the future of your business starts today.
Copyright © 2021 Assured Standard. All Rights Reserved.
linkedin facebook pinterest youtube rss twitter instagram facebook-blank rss-blank linkedin-blank pinterest youtube twitter instagram