The investment in commercial auto insurance is an important one. It provides business owners with both protection for their asset’s value and liability protection. Yet, proper coverage is something that can be confusing. Who needs a commercial policy? And, when do you make the determination that your personal auto insurance is no longer enough? Here is what you need to know.
What Makes Commercial Auto Insurance Different?
When an individual operates a personal car for business, he or she is responsible for damages caused in an accident. The value of the car may benefit from auto insurance. Liability insurance protects other drivers' losses. Generally speaking, the amount of damage and claims for personal accidents are significantly less than those associated with commercial vehicles. Therefore, a commercial policy is more appropriate for commercial drivers.
Specifically, commercial auto insurance provides more:
Considering this, determine what could happen if you were in an accident in a company car. The costs are likely to be higher. And that means a more versatile policy is necessary.
- It provides coverage to meet the value of the vehicle. Commercial vehicles tend to be a higher value to replace than passenger cars.
- It provides more liability insurance. This helps protect against claims made against the company for the driver’s errors.
- It also provides coverage for the employee's losses such as medical payments.
So, Who Needs a Policy?
Some drivers need to have a commercial auto insurance policy. If you use your vehicle for work, even if you own the vehicle, it needs business insurance. For example, if you use your truck for work-related hauling, you are performing business activities in it. It should have commercial auto insurance.
On the other hand, if you just drive your vehicle to and from work, you do not need coverage. If you use your vehicle for work needs from time to time, and this is not frequent, you may not need it.
Another key factor is ownership. Does the company own the vehicle? Any vehicle owned by the business needs commercial auto insurance. This provides a safety net for the company itself. It should provide ample protection for the asset from all risks. This is more than just liability protection.
If you are unsure if you need commercial auto insurance, speak to your Florence business insurance agent. Talk about the way you use your vehicle. Determine if a policy could help. The goal is to keep risks low.