Commercial Auto Insurance | Cost, Benefits, and More

Commercial Auto Insurance Can Protect Your Business

Commercial auto insurance is similar to the auto insurance you probably have on your personal car. While providing some similar protection, commercial auto insurance is designed to address the more complex coverages needed by your business. Commercial auto insurance can protect your business from liability stemming from vehicles used for your business.

Businesses that purchase commercial auto insurance usually have:

  • A vehicle that is titled to their business
  • Carry tools, equipment, or products used to conduct business
  • Drive to and from job or worksites
  • Transport employees or customers

A Business auto insurance policy has the flexibility to be applied to vehicles used for business, personal, non-owned, or hired vehicles. The exact coverage you need for each vehicle will be based on the vehicle’s specific type and use. The insurance policy can differ by vehicle. In California, automobiles are classified by weight (light, medium, heavy, extra heavy) and by the type of use (private passenger, service, commercial). The type of business you have will also determine how your commercial automobile insurance policy is classified. There are specific codes assigned based on the kind of exposures common to your type of business. The code your business is classified under is the first step in determining what your premiums will be.

Business Auto Insurance Policy

Commercial auto insurance policies often use a Combined Single Limit for bodily injury and property damage. Combining these creates higher limits for both coverages. Common commercial auto insurance limits are $500,000 or $1,000,000. By partnering with an expert in commercial automobile insurance, you can determine the best coverage given the type of business and the financial risk you are comfortable with.

The premiums for your commercial automobile insurance are determined by several things, including:

  • Number of vehicles you are insuring
  • The types and value of the vehicles
  • Level of risk involved in the vehicle’s operation
  • Claims history of your business
  • Driving records of employees using the vehicles
  • Policy deductibles and limits

We understand the value of your business vehicles. Whether your employees drive across the country or make local deliveries, your business vehicles are critical to keeping your business running. But accidents do happen. As your partner, we are here to ensure that when they do, you have the appropriate insurance in place to keep your business and employees protected. We will work with you to understand your business’s unique needs and create a customized policy that meets your financial and operational needs.

Frequently Asked Questions About Our Commercial Auto Insurance Coverage

Getting commercial car insurance can protect you and your company from a wide variety of risks. If you get a car that’s meant to be used for your business, you should get liability coverage.

There’s no way to tell how and when a car can break down. It’s also impossible to control how your employees are driving the vehicle at all times. In these cases, it’s always a great option to talk to insurance companies that focus on auto insurance.

This section covers most commercial auto insurance FAQs online. If you’re interested in getting the best business auto insurance on the market, make sure to keep reading.

What Makes Commercial Insurance Different from Personal Auto Insurance?
It’s normal to think that commercial auto insurance is the same as personal insurance. Even though they’re similar, in a way, they differ in their approach.

When you get personal auto insurance, you cover yourself from damages related to your vehicle (the one you use for other things unrelated to work). Commercial auto coverage, on the other hand, is meant to address damages related to any vehicles used to drive from/to your company.

Many industries benefit from getting commercial auto insurance, such as delivery companies, moving companies, and other transportation businesses. However, keep in mind that this type of policy offers protection for any business owner, regardless of the industry they work in. In any case, if you purchase a car for any transportation activities related to your business, you need to get insurance coverage.

The beauty of business insurance coverage for cars is that you can apply it for personal, non-owned, hired, or business vehicles. You may get different commercial auto insurance quotes depending on the type of vehicle you own.

To summarize, both personal and commercial auto insurance cover damages related to vehicles. However, commercial insurance focuses on vehicles related to your business activities.

Do You Need a Commercial Auto Insurance Policy If You Have a Small Business?
You’ll probably need insurance for your business vehicle regardless of the size of your company. Whether you drive to your workplaces/meeting areas or have employees driving their cars to your business, you’ll benefit from getting coverage.

Unfortunately, accidents are sometimes impossible to prevent, so you need to be prepared in case anything were to happen.

Depending on the policy, you could get:

  • Liability coverage
  • Rental car coverage
  • Uninsured/underinsured motorist coverage
  • Collision coverage
  • Comprehensive coverage

Remember that your commercial auto insurance cost will depend on several factors. Besides the type of vehicle you own, here are other factors that our team at S Philips Surety & Insurance Services Inc. takes into consideration when quoting clients:

  • Number of insured vehicles
  • Risks involved in your daily driving tasks
  • The company’s claims history
  • Driving records of everyone who’s using the insured vehicle

Finally, you can adjust your policy coverage depending on your deductible/limit. If you don’t know where to start, our team can help. We know how complicated it is to get money for insurance coverage as a small business owner, so rest assured that we’ll help you get the best solution for your team.

What Happens If You Don't Get a Commercial Auto Policy?
There are plenty of consequences to consider if you don’t get commercial auto insurance. The main risk you’re exposed to is legal liability. If you face a lawsuit and don’t have insurance, you may have to pay out of pocket for legal expenses, personal injuries, and property damage.

Other consequences of not having vehicle commercial property insurance include:

  • Fines
  • Penalties
  • Loss of operating authority
  • Reputation damage

If you or your employee gets involved in an auto accident and don’t have an insurance policy set up, it may be harder for you to get insurance coverage in the future too. In any case, it’s always better to talk to reputable commercial auto insurance companies in California before it’s too late.

Do You Need a Personal Auto Insurance Policy If You Already Have a Commercial One?
It depends on your needs. If you get personal auto insurance only, it won’t cover incidents related to the usage of the vehicle for business purposes. On the contrary, if you get commercial auto insurance only, you won’t get protection if you use the company vehicle for personal use.

The best way to know which option you should consider is to evaluate how you’ll use the vehicle. If you’re keeping it for the sake of business activities only, then commercial auto insurance will be enough.

On the other hand, if you’re also considering using the vehicle for personal use from time to time, it won’t hurt to get personal insurance too. Getting both policies may involve an extra expense, but it will give you a wider range of protection in case something happens to you, your vehicle, or your employees.

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