Business auto insurance is necessary if you use a vehicle in your business. A complete picture of your vehicle use will help your insurance professional to provide you with coverage most suitable to your requirements.
A personal auto insurance policy excludes coverage for commercial use of your vehicle. A business auto insurance policy offers you protection and also provides a definition of business use of your vehicle(s). If there is any uncertainty, it is better to obtain a commercial auto insurance policy, so that there is no chance of you being uninsured in the event of an accident.
Business auto insurance policy premiums are affected by the following:
- Business Location – Vehicle location determines some of the premium
- Type of Drivers – Drivers with safe records are more economical
- Type of Vehicle – Five-star safety rated, domestic, mid-sized sedans have the lowest premiums
- Vehicle Deductible – If your business can afford part of the risk and maintain a high deductible your premiums will be lower
- Safety and Anti-Theft Devices – Anti-theft alarms, GPS tracking, air bags, seat belts, and other safety devices can significantly lower premiums
Special Commercial Insurance Coverage and Considerations
Some businesses must adhere to federal and state regulatory standards for their vehicles. As an example, if your business hauls interstate cargo, there are specific Department of Transportation requirements for commercial insurance. You will need to make sure you have a thorough understanding of those requirements. In addition, if you deliver or haul for others or use others’ equipment such as leased trailers or rental equipment, you will need hired or non-owned vehicle coverage.
Who is the Insured?
Make sure you know who is actually covered by your business auto insurance. Businesses often set up a company to lease equipment to the main company. However, the leasing company is the titled owner of the vehicles. Businesses often mistakenly identify the main company, and not the leasing company, as the titled owner on the policy. In addition, it is common for the dba of the company and not the full name of the company to be listed. You should list the full name of the company as an insured, the titled owner, any affiliates, dba, and all employees as insured on your commercial insurance policy.