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Commonly Asked Questions about Commercial Auto Insurance Coverage

By June 24, 2021June 30th, 2021Business Auto Insurance

Regardless of the size of your business, you need a commercial auto insurance policy to cover all vehicles owned by your company or driven by your employees. Having this coverage protects your financial interests if third parties bring auto accident liabilities claims or lawsuits against your business. Here’s a look at a few commonly asked questions about commercial auto insurance coverage.

1. Do I Need Commercial Auto Insurance If I Already Have a Personal Auto Insurance Policy?

Yes, you do, as commercial auto insurance generally covers you or your employees for work-related incidents. Personal auto insurance policies have limitations. They generally do not cover vehicles owned and used by you for business purposes. Personal auto insurance offers protection against third-party liabilities, including injury and property damage claims. It doesn’t cover issues related to business operations, such as injured passengers or employees.

You may consider taking out a commercial auto insurance policy if you regularly use your vehicle for any of the following operations:

  • Driving employees or clients
  • Passenger transport
  • Freight

2. How Does Commercial Auto Insurance Work?

As a business operator, you are legally required to have an auto insurance cover for your company vehicles’ drivers and passengers. In Florida, for example, commercial auto insurance requirements include a minimum of $10,000 in personal injury protection (PIP) coverage and $10,000 in property damage liability coverage.

The following types of vehicles are usually covered for business operations:

  • Delivery vans
  • Company cars
  • Food trucks
  • Construction vehicles like forklift
  • Dump trucks

Note that you might need higher liability limits depending on your specific type of vehicle.

3. What Are the Benefits of Commercial Auto Insurance?

The following are a few ways in which a commercial auto insurance policy can benefit you.

  • Increases your creditworthiness

If you plan to finance your commercial vehicle, having adequate insurance coverage in place will improve your credit scores and make lenders more interested in offering you affordable loans.

  • Covers your business equipment in transit

Some commercial auto insurance policies might cover your equipment in transit. This way, if your inventory gets stolen or damaged during transit, you can easily file a claim for the damages.

  • Enables you to get better lease terms

You can easily customize your commercial auto insurance coverage to include specialized coverage for leased vehicles, thus lowering your lease-related liabilities.

  • Helps build greater trust among your customer

This policy ensures added protection to your business-owned vehicle, thus improving your competitiveness and credibility among customers.

4. What Does a Commercial Auto Policy Cover?

The following coverages are included in a commercial auto insurance policy:

  • Personal injury protection – It covers claims such as medical bills for your drivers or passengers due to accident injuries.
  • Property damage liability– It covers damages caused by your drivers in an auto accident.

Other optional coverages include:

  • Collision (replaces your car if damaged in a crash)
  • Comprehensive (replaces your car if stolen or damaged in a covered event like flooding or fire)
  • Uninsured motorist (covers medical bills or property damage if the at-fault driver is uninsured)
  • Hired and non-owned (covers rented cars used in your business operations)
  • Towing and roadside assistance (covers expenses incurred if your business vehicle breaks down on the road)

5. What Is Not Covered by Commercial Auto Insurance?

Commercial auto insurance coverage has certain exclusions, such as:

  • Incidents occurring during personal automobile use
  • Workers’ compensation
  • Employer’s liability
  • Injury or property damage during loading/offloading

These are the answers to some of the commonly asked questions about commercial auto insurance. To learn more about protecting your fleet and drivers/employees through proper insurance, contact us at Atlas Insurance in Sarasota, FL. Our experts are here to help you insure your business vehicles.

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