COMMERCIAL AUTO Insurance
When you use a vehicle for business purposes, you typically must purchase commercial auto insurance to comply with your state’s legal requirements. Your auto lender may also have different requirements for coverage that you must comply with. A standard auto policy is not suitable if the vehicle is used for business purposes. In many cases, the business will purchase commercial car insurance coverage for one or more vehicles that it owns and that its employees drive, and some policies are specifically designed for fleets of vehicles. This type of coverage can be used to protect the business from numerous types of financial loss related to the commercial-use vehicles.
One issue that businesses face when employees are behind the wheel is liability. If a driver causes an accident, the injured party may sue the business for damages. These damages include vehicle repairs, medical expenses, time missed from work and more. This type of liability issue can be expensive for a company to deal with, and insurance may pay for the related expenses up to the limits of the policy’s coverage.
Depending on the type of commercial auto insurance that you purchase, your policy may also pay for repairs to your vehicles if they are damaged by a wide range of causes. This damage could be caused by an accident, vandalism or other criminal activities, bad weather and more. The coverage typically is based on the limit that you select as well as by the value of the vehicle at the time. Some commercial policies also provide you with rental car reimbursement, payment for medical expenses for injured employees in the vehicles and more.
If you are preparing to purchase a new policy for commercial vehicles, be aware of the different coverage types and how they work. Some people assume that a policy will cover any type of loss event, and they face incredible financial stress when they learn this is not true after trying to file a claim. You can also set your coverage limits for each type of coverage that you purchase. The deductible amount is also selected at your discretion. Be aware that a lower deductible amount increases the premium.