Commercial Auto Insurance: What It Is and Why You Need It
If you are a business owner, and your business requires the use of commercial vehicles, you will need to get commercial auto insurance. Some types of businesses that may require this kind of insurance include construction, general contractors, hotel shuttle service, pest control, landscaping and many others.
What does commercial auto insurance cover?
The purpose of commercial auto insurance is to protect you, the business owner, from costs related to injuries or property damage. If you or an employee is injured, injures someone else, or harms personal property while driving the company vehicle, commercial auto insurance will cover it. If you hit someone in your company vehicle, that person’s medical payments can really add up. So it’s important to make sure you’re covered.
If you will occasionally be driving the company vehicle, commercial auto insurance will still cover the cost of any mishaps. If, however, you reverse the situation and drive your personal vehicle for business purposes, then you’ll want to make sure you have enough coverage for liability in your regular auto insurance policy or you should buy commercial auto insurance. A good example is someone who uses their personal car for delivering pizza. The business insurance policy won’t cover an accident under those circumstances. So the driver will need to have enough liability coverage.
In the case of Uber drivers, they are required to have their own car insurance. However, they get a small amount of liability coverage only when the Uber app is turned on. If you’re considering becoming an Uber driver, you’ll want to get more information about this.
Is commercial auto insurance expensive?
Commercial auto insurance IS typically more expensive than personal auto insurance. However, it also depends on the type of vehicle that’s being insured. If you’re a small business, the average cost is $750 to $1,200 a year per vehicle. If you drive a truck, owner operators’ insurance can run anywhere from $8,000 to $12,500 annually.
What businesses are NOT required to get commercial auto insurance?
It may seem surprising, but a number of professions actually do not need to be covered by commercial auto insurance, as long as there is an active personal auto insurance policy in place. Many of these are professions in which clients may be driven for business reasons. These include lawyers, realtors, accountants and various types of consultants.
The best way to determine whether or not you need commercial auto insurance is to figure out how often your vehicle is used for business purposes. If the vehicle is used occasionally and not for primarily business purposes, then a personal auto insurance policy may be all you need.
At Zawada Insurance Agency, we’ll work with you to help you find the right type of commercial auto, as well as business owners, insurance with the coverages most important for you and your business.
Zawada Insurance Agency is a family-owned and operated independent insurance agency, working to get you the most comprehensive coverage at a competitive price. For more information about auto, life, homeowner, business and other insurance coverages, please contact Zawada Insurance Agency today. Zawada Insurance Agency, Inc. located in Worcester, Massachusetts, serving central Massachusetts and beyond.