Commercial Car Insurance: Do You Need It?

Not sure about commercial car insurance? What would happen if you had to pay a large claim? Here's what you need to know about insurance.
commercial car insurance

Owning a business comes with a myriad of responsibilities. Creating a relevant product or service and staying fair to your clients are among the essential aspects. You also have to guarantee that your employees and your company remain protected. If you decided to get a vehicle or fleet of cars for your business, you could expect a higher wear and tear rate if this is the case. Have you been skimping on your commercial car insurance? If so, think about the damage it could do to your company if you have to pay thousands of dollars upfront for the accidents that you least expected? Start with Geico reviews to help you shop for the best insurance policies.

What You Need to Know

Commercial car insurance is like personal car insurance in many ways. But the former is specifically designed for vehicles used by or for a business. You will need this if you own a car for business purposes. It’s also great for vehicles registered as commercial autos. It’s advisable to get this type of coverage if your employees use vehicles to:

  • Towing other cars.
  • For trucking and freight transportation.
  • Run errands on behalf of your company.
  • Transport people as a chauffeur or taxi service provider.
  • Transport flammable materials or other hazardous products.
  • Use the vehicle to carry equipment such as plows and cranes. 
  • Transport housekeeping tools and equipment for business use. 
  • Deliver goods, such as pizza, newspapers, and other wholesale or retail products.

Commercial car insurance covers all sorts of vehicles for business purposes. Depending on your carrier, your policy may cover your company car. It may also include work vans, box trucks, food trucks, and service utility trucks. Most carriers also cover delivery trucks, dump trucks, forklifts, and other construction vehicles. 

What Does Commercial Car Insurance Cover?

Like personal car insurance, commercial car insurance may consist of different types of insurance coverage. It generally offers collision coverage and liability coverage for company vehicles and their drivers. Collision coverage will help pay for the medical costs and car repairs for yourself and your vehicle. On the other hand, liability coverage will help pay for medical expenses and car repairs for the other driver involved in the accident. 

Other plans include comprehensive coverage to help pay for damages due to non-crash incidents, such as vandalism, theft, falling objects, and extreme weather. Some policies also have uninsured or underinsured motorist coverage. 

Some insurance companies also have commercial car policies that offer several types of specialized coverage. These include:

  1. Hired Automobile Coverage. If your employees need to drive a rented car or van for business purposes, such as transporting your clients or other employees, you may need this type of liability protection. 
  2. Non-owned Automobile Coverage. This provides liability protection when your employees occasionally use their private cars for business purposes.
  3. Trailer Interchange Coverage. This is essentially a form of physical damage insurance for trailers that you don’t own but used for your vehicles. This coverage type will protect you if the trailer is damaged by vandalism, theft, fire, explosion, or collision. 
  4. Rental Reimbursement With Downtime Coverage. This will help cover your costs to rent a temporary vehicle replacement if your vehicle is inoperable and needs repairs. This type of coverage is especially beneficial for those with businesses in trucking operations. These include owner-operator, logging, and debris removal, to name a few. 

Most insurance carriers that market personal car insurance plans also offer commercial car insurance policies. If you already have an existing insurance company, discuss whether they can also provide you with commercial coverage. If so, ensure that you fully grasp their eligibility criteria, any exceptions, and restrictions for such policy. 

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