Wednesday, June 15, 2022

What Is Commercial Auto Insurance Policy

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When Your Business Vehicle Is Also Your Personal Vehicle

What Does Commercial Auto Insurance Cover? : Auto Insurance Tips

Sometimes employees or executives of a company or other persons who are supplied with a vehicle owned by the company have only that vehicle. They do not own a personal vehicle nor do they obtain personal automobile coverage. The BACF does not cover personal use of the vehicle in this situation. To close this coverage gap, you need to add the Drive Other Car Coverage Endorsement to your BACF. This provides insurance while the named individual or a member of his or her family is driving a car borrowed from a third party.

Commercial Auto Insurance For Small Business

We’re the #1 commercial auto insurer in America*, insuring more than 1 million commercial vehicles

Commercial auto insurance is liability and physical damage protection for vehicles, such as cars, trucks and vans, that are used for business. Commercial vehicles require a separate policy because theyre typically exposed to more risk than personal vehicles.

Commercial auto insurance isnt just for industrial vehicles like semis or dump trucks. For example, businesses that use a car to run errands, carry tools or transport clients might also need a commercial auto policy.

Commercial Auto Insurance: What Is It And How Much Does It Cost

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If you drive your car for a business, such as delivering packages or passengers, then youll probably need commercial auto insurance. Thats because your personal auto insurance specifically excludes coverage for your car while youre using it for work.

Sometimes it can be tricky to draw the line between what personal use of an auto is compared to business use, and the definitions provided by insurance companies arent always clear.

Heres the main thing to keep in mind: if you use your vehicle at all for business purposes, the odds are you need commercial auto insurance.

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Documents Required To Claim Commercial Vehicle Insurance

You might require the following set of documents while making a claim with the insurance company.

1. The commercial insurance policy

2. Duly filled claim form

3. Fitness certificate of the vehicle

4. Driving license of the driver of the vehicle

5. Registration certificate of the vehicle

6. First Information Report wherever required

Be Sure The Right Insured Is On The Policy

Things to Know about Commercial Auto Insurance Coverage ...

An insurance contract usually requires that the owner of a vehicle be named in the policy “Declarations” page as the principal insured. If you drive any of the same vehicles for both business and pleasure, make sure you tell your insurance agent who holds the vehicles title, you personally or your company. This will avoid problems if you need to file a claim or a claim is filed against you.

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How Commercial Auto Insurance Protects A Business

Commercial auto insurance covers damage to a company vehicle and bodily injuries when you or an employee cause an accident.

Commercial auto insurance provides five types of insurance protection:

  • Auto liability covers legal costs if someone sues over damage caused by your vehicle.
  • Medical payments for medical bills related to accidents.
  • Collision coverage pays to fix damage to your car from a collision with another vehicle.
  • Comprehensive coverage pays for vehicle theft and damage from other causes, such as vandalism.
  • Uninsured motorist coverage protects you in case a driver without insurance injures the driver or passengers in your vehicle. In some states, it also covers damage to your vehicle from uninsured motorists.

Some types of coverage are optional, such as collision coverage. Other types of coverage are mandated by state law. Typically, business-owned vehicles must be covered by commercial auto insurance.

Does Commercial Auto Policy Cover Personal Use

Commercial auto insurance does not cover personal or leased vehicles. However, your business can still be held accountable if an employee gets into an accident in a personal or leased vehicle. Hired and non-owned auto insurance is the appropriate policy for vehicles that your business uses but does not own.

Do you need commercial insurance for DoorDash? Does DoorDash have insurance? Yes, DoorDash has a commercial auto insurance policy that covers up to $1,000,000 in bodily injury and/or property damage to third parties arising out of accidents while on an active delivery. To qualify as on an active delivery you must be in possession of the goods to be delivered.

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What Is Workers Compensation Insurance

Business owners are responsible for providing workers with a safe work environment, but accidents can happen even in the safest workplaces. Workers compensation is insurance coverage designed to provide medical benefits to ill or injured employees regardless of fault. Most states require employers to carry some form of workers compensation insurance.

Workers compensation covers injuries and illnesses that happen during the employees regular work activities. Coverage is also provided for unnatural events while an employee is at work, such as workplace violence, terrorism or a natural disaster.

Every state has its own workers compensation laws determining which companies must purchase workers compensation and the amount of benefits each injured worker is entitled to receive. To determine your own states requirements, you should visit your states workers compensation department website.

Premiums for workers compensation are based on the type of business and how much payroll the company has. In addition, each business has a class code for its specific industry. The location also plays a factor in workers compensation premiums, as does the companys loss history.

What Are The Coverages Included In A Commercial Auto Insurance Policy

How to Find the Best Commercial Auto Insurance Coverage : Commercial Insurance Tips

Many types of coverage are available. Some of the most common coverages include:

  • Collision coverage pays for accident-related damage to your insured business vehicle.
  • Comprehensive coverage pays for damage to your insured business vehicle from non-collision causes such as theft, weather, vandalism or fire.
  • Rental reimbursement pays for a rental vehicle, up to certain limits, after an accident causes damage to your insured business vehicle.
  • Liability coverage pays injury damages to others and damage to other people’s property if you are at fault, including your legal expenses if you’re sued.
  • Uninsured or Underinsured Motorist coverage pays for injury damages to or property damage suffered by occupants of your insured business vehicle if the accident is caused by an inadequately insured driver.
  • Personal Injury Protection pays medical expenses and income loss for accident-related injury suffered by occupants of your insured business vehicles, regardless of fault.
  • Medical Payments coverage pays medical or funeral expenses for accident-related injury suffered by occupants of your insured business vehicles, regardless of fault.

These coverages are available for autos you own and may be available for autos you hire or lease or for non-owned autos . Some of these coverages vary by state. If your autos are garaged out of state, check with your agent to ensure you have adequate coverage for the states where your insured autos will be used.

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What Is Commercial Property Insurance

Commercial property insurance covers your building and its contents and any outside fixtures, attached or unattached structures like garages, signs or fences. Basic commercial property insurance coverage protects businesses from losses caused by fire, theft, explosions, vandalism, vehicle damage and other similar causes of loss. If a type of coverage is not listed in the policy, it can often be added by endorsement.

Tips For Buying Commercial Auto Insurance

In the market for commercial auto insurance? Here are some buying tips from Dave Hynek, general manager of commercial lines marketing at Acuity Insurance.

Get enough coverage. Make sure you have enough commercial auto insurance coverage to protect what you could potentially lose if theres an accident lawsuit against your business.

First, you will want to ensure that your policy covers the full scope of your exposure to protect your business and yourselfthis includes limits and coverages, Hynek says.

Talk to an agent. Dont hesitate to enlist the aid of an insurance agent. An agent can help you identify the right policy for your business, says Hynek, including specific commercial auto coverage for the type of work you do.

Add uninsured/underinsured motorists coverage. Dont overlook this coverage in a commercial auto policy.

Uninsured/underinsured coverage helps you pay for damages caused by a driver who doesnt have auto insurance or has insufficient limits. If youre hurt or your truck is damaged in a crash caused by such a driver, this coverage will help pay for costs, up to the limits in your policy, Hynek says.

Do research on the insurance company. Take time to do some digging about the insurance company you have in mind for your commercial auto insurance.

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What Is Commercial Auto Insurance Coverage

Business Automobile Liability Insurance is for businesses that own and operate vehicles. This insurance helps companies cover the costs of repairing or replacing company vehicles within the boundaries of the insurance policy.

Every business that uses vehicles to transact business needs Commercial Auto Insurance. Companies using their personal vehicles for business-related purposes may find that their personal insurance does not cover business-related risks. Personal Auto Insurance on a vehicle used for business purposes may not have enough insurance, leaving the company financially responsible for losses.

Business Automobile Liability Insurance was purposefully designed to help protect businesses from the unknown. With higher coverage limits than personal auto insurance, it helps safeguard businesses and improves a business chances of continual operations.

Commercial insurance contracts create partnerships between companies and insurers. Under these contracts, insurers are required to pay for physical damages based on the terms of the insurance policy and up to the limits of the insurance coverage. Insurers cant cancel Commercial Auto Insurance if a business files a claim against the insurance policy.

Businesses can purchase Commercial Auto Liability coverage for their cars, trucks, heavy-duty trucks, and semi-trucks.

Do I Need A Business Auto Policy

Commercial Auto Insurance for Small Business

Your insurance agent will ask in detail how you use vehicles in your business who will be driving them whether you own, rent or lease and whether you and your employees are likely to be driving their own cars for your business. The answers to these questions will indicate the types of coverage you need.

In general, only a BACF can provide the level of liability protection a business needs. In todays litigious society, many insurers recommend a business auto coverage limit of $1 million with $500,000 as the minimum that even a small business needs to cover the potential damages in a serious accident.

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Inclusions: What Is Covered In Commercial Car Insurance Policy

This section lists the inclusions of a commercial car insurance policy. Inclusions are situations that are covered under an insurance policy. You can go ahead and raise a claim against the following situations.

1. Damages arising out of a malicious act not caused by the owner.

2. Damage due to fire, explosion, or if lightning strikes the insured vehicle.

3. The entire coverage offered by the Third-party car insurance policy.

4. Damage to the insured vehicle caused due to an accident.

5. Damage to the insured vehicle caused due to terrorist activity.

6. Damage due to man-made calamities like bandh, riots, vandalism, etc.

7. The damage occurred while the insured vehicle was being transported via water, rail, or land.

8. Damage resulting from natural calamities like earthquake, floods, hurricane, cyclone, landslide, hailstorm, frost, etc. Damage such as shock damage or fire damage due to a natural calamity is also covered.

9. Theft of the insured vehicle . Here, the owner is expected to submit the vehicle keys and the necessary documents.

Note: Personal Accident cover for the owner/driver is mandatory in India and needs to be bought separately along with the Third-party or Comprehensive commercial vehicle insurance policy. It covers both permanent disability/death while driving a car and the coverage will be maximum Rs. 15 lakhs during one policy period.

Tips On Buying Commercial Auto Insurance

If youre looking to purchase commercial auto insurance or simply want to switch providers, heres a handy guide for you:

  • Only hire trained, responsible, and reliable employees to operate your vehicles. Ask to see their driving records and drivers licenses.
  • Although auto insurance is mandatory in almost all states, most people only purchase the minimum coverage. Bad idea. Make sure to cover all the risks that youre most vulnerable to.
  • Local insurance agents understand your needs and the insurance market. Hire and consult with experienced agents so that you can get the right policies and know if you qualify for discounts.
  • If you increase your deductibles, you will lower your premium payments considerably.
  • Most insurance providers will offer special discounts to those who have installed dashcams, anti-theft devices, airbags, and other safety tech.

Contact your insurance agent for more information on getting affordable and comprehensive auto insurance coverage.

Best Commercial Auto InsuranceMayaFontenot

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Does Personal Auto Insurance Cover Business Errands

It is common for a business to send its employees out on business errands, such as depositing a check or visiting a client. Most states require minimum liability coverage for all vehicles so your employee may already have liability insurance that covers their vehicle. However, as an employer, you have no control over the level of liability insurance that your employee carries, which in some states could be as low as $30,000-$50,000.

If your employee causes a crash while driving from the office to a worksite and causes serious injury to another driver, the other driver may sue your company. Since your employee was on the job at the time of the crash, your company may be responsible for the injured drivers medical bills and lost pay due to the crash that exceeds your employees personal auto insurance limits.


  • Your employee drives his personal car to pick up materials for a company tradeshow. He has personal auto liability coverage of $50,000, and he causes a crash resulting in $300,000 in damages. Your company could be responsible for the $250,000 of damages that exceed your employees insurance limits if you dont have proper coverage.

If you commonly have employees driving on behalf of your business, you should purchase hired and non-owned auto coverage.

Employees Covered As Permissive Users

Why Is Commercial Auto Insurance Needed? : Auto Insurance FAQs

Most of the individuals who drive company-owned vehicles are employees. Your employees are insureds while driving autos you own, hire, or borrow if such vehicles are covered autos .

That is, employees are covered while driving vehicles you own or hire as long as you have purchased liability coverage for autos you own or hire. If your liability coverage applies only to owned autos, employees are insured only while driving autos you own. They are not covered while driving autos you hire.

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What Is A Garage Automobile Insurance Policy

Businesses handling vehicles owned by others need a garage auto liability policy. It provides protection for owned vehicles as well as other vehicles, including those owned by customers.

Insurance is available to cover

  • occupants of owned or customer-owned vehicles or those outside of the vehicle if they are injured in an accident
  • damage to owned or customer-owned vehicles and to the property of others

Businesses such as vehicle dealerships, repair garages, automobile body shops, service stations, tow truck operations and parking lot owners require a garage auto policy.

If you lease vehicles to others, you will need a commercial auto policy rather than a garage auto policy.

* The commercial auto policy is underwritten by Aviva Insurance Company of Canada. The information on this website is provided to you for information purposes only. Terms and conditions apply, for exact terms, definitions, limitations and extensions, please speak with your insurance broker for more information.

**Only available in Ontario

What Kind Of Vehicles Are Covered By A Commercial Auto Insurance Policy

Box trucks, food trucks, work vans and service utility trucks are just a few examples of larger commercial vehicles which will require a commercial auto insurance policy, including coverage for employees operating the vehicle and possibly the equipment inside. You may have heard of this coverage referred to as commercial auto insurance, commercial car insurance, truck insurance, or fleet insurance. While commercial vehicle insurance is most commonly associated with trucks or more recognized work vehicles, regular cars and automobiles may also require a commercial auto policy if they’re used for business purposes.

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Why Do You Need Commercial Vehicle Insurance

Certain business usage and vehicle types may be excluded from personal auto insurance policies. Why? Since personal auto policies were not meant for businesses, they are written and rated differently. More important to youa business owner or managerbusinesses often need the particular coverages found in a commercial auto insurance policy.

Determining whether your situation requires commercial auto coverage can still be confusing. Here’s a little more information and examples of when you need commercial insurance.

How Do I Get Commercial Insurance

How Commercial Auto Insurance is important for business ...

Four steps to buy business insurance Assess your risks. Think about what kind of accidents, natural disasters, or lawsuits could damage your business. Find a reputable licensed agent. Commercial insurance agents can help you find policies that match your business needs. Shop around. Re-assess every year.

How much is insurance on a commercial truck?

For owner operators who have a permanent lease with a motor carrier, the average cost of semi truck insurance is between $3,000 to $5,000 per year. For owner operators with their own authority, the cost can be much higher around $9,000 to 12,000 per truck per year.

Does Geico offer commercial property insurance?

Business Insurance coverages are written through non-affiliated insurance companies and are secured through the GEICO Insurance Agency, Inc. We can help you secure business insurance in all states except Hawaii.

What is business use Class 1?

Business car insurance classes of use Business class 1 car insurance covers you for social, domestic and pleasure use in addition to driving to and from your place of work. It also covers the policy holder for short business journeys between different sites.

Does Geico do commercial auto?

Not only can GEICO offer commercial insurance on any size fleet, including coverage for all types of cars, trucks, and vans, we can also insure vehicles for specialty services, like towing, landscaping and construction.

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