July 12

Commercial Auto Insurance


Commercial Auto Insurance

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Auto insurance for businesses

Covers the business against lawsuits from accidents in the company vehicle

Commercial auto insurance pays for repairs or injuries as a result of an accident

Commercial auto insurance is essential for any business that owns vehicles.

This type of insurance covers damages related to business-owned vehicles, including vandalism, theft, and—of course—accidents.

 Motor vehicle crashes in the United States have been shown to result in overall damages exceeding $75 billion in a single year.

commercial auto insurance

What is commercial auto insurance, and what does it cover?

In case of an accident, business auto insurance may cover physical damage to the automobile and medical expenses.

For example, say you run a delivery company. One of your drivers is in an accident with another vehicle.

Your auto insurance liability coverage could pay for repairs to your business vehicle and healthcare costs for your driver.

If the other driver involved sues for negligence, your insurance may also cover related legal expenses.

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Collisions aren't the only kind of damage a car can have. Auto insurance also covers vandalism, object impact, and some weather-related events.

For example, say a wind storm blows a tree branch down right on top of your business automobile.

Your insurance may cover the damages and could even cover the cost of a temporary replacement vehicle until your car is fixed.

A business vehicle is a pricey investment that you want to protect with adequate insurance.

A single incident can cost thousands of dollars. In case of a possible injury, costs, including medical expenses, can cost upwards of $155,000. This isn't the kind of cash you want to pay out of pocket.

Dodo Definitions

insurance terms explained:

Independent Insurance Agency:  You can buy insurance from an indendent agency but they represent other companies (typically several).  For example, an independent agent who works for Acme Insurance Agency might sell you an auto insurance policy insured by Travelers Insurance.

What types of businesses need commercial auto insurance?

If your business owns any vehicles, commercial auto insurance is a must-have.

Courier and transportation services are prominent examples, even catering companies will need business auto insurance.  

If your company has work vans, box trucks, or utility vehicles, such as Carpenters, Plumbers and Painters, you also clearly need this insurance.

commercial auto insurance

However, many companies also own cars for workers to use. For example, if you have a sales team, you might equip them with vehicles for getting to client meetings.

Some companies are in the business of moving vehicles, like car haulers, who definitely need commercial auto insurance. 

Just because your business isn't focused on cars doesn't mean you can forego commercial auto insurance.

Small businesses refer to workman’s comp as small group health insurance and general liability insurance.

Self-employed businesses without employees are exempt from providing workers’ compensation.

Businesses who hire contractors to work for them often require them to carry their own liability insurance, including workman’s compensation.


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