When do you need business auto insurance? Whether you’re driving a company car or your personal car, you’ll want to make sure you have the right coverage. In this article, we’ll cover Liability Damages, Collision and Comprehensive Loss for your business autos, and Medical Expenses for occupants of your car. If you’re unsure of whether or not you need coverage, we’ll explain some of the most common reasons.
Coverage for liability damages
When you purchase a business auto insurance policy, you can choose to add physical damage coverage to your policy. This coverage is sometimes referred to as collision or comprehensive coverage, and it will cover damages to insured vehicles that result from covered risks. Collision insurance covers damage caused by a vehicle crashing into yours, while comprehensive covers anything other than a collision. Physical damage claims can occur because of fire, wind, hail, vandalism, theft, or even acts of nature.
For example, suppose a plumbing company employs a driver who is driving a company van to a customer’s house. While on the road, the employee fails to notice a bicyclist riding in the road and hits him. This causes him to break his arm, and he sues the company for $150,000. The plumbing company’s Commercial Auto Liability Insurance will cover the costs of medical treatment and lost income for the bicyclist.
Collision or comprehensive loss to your business autos
If you have a fleet of business vehicles, you will want to consider commercial vehicle insurance. This type of coverage protects you in case of accidents and provides liability protection and medical expenses if someone is injured while operating your vehicle. Your commercial policy can also cover hired and non-owned vehicles. It will also cover damages if you are at fault in an accident. The type of coverage that you need depends on the type of business vehicles you operate.
If you have a beat-up pickup truck and use it for personal use, you can probably avoid collision or comprehensive coverage and choose an alternate vehicle for your business. However, if your business vehicle is a new company car, you will want full coverage. Most small business vehicles fall somewhere between collision and comprehensive coverage. If you’re unsure, contact your insurance agent today.
If you’re unsure, make sure to do your research as it can heavily depend on the nature of how you use your vehicles for your business. For example, if you operate a shuttle bus company you’ll want to look into this shuttle bus insurance guide for some important information, as the type of coverage needed can vary between specific circumstances.
Damages sustained by occupants of your business autos
Commercial auto insurance typically covers liability damages and physical damage loss to business vehicles and also pays medical expenses for injuries to other motorists or occupants of your business autos. It is divided into two types: collision loss, which is the result of an auto accident, and comprehensive loss, which covers damage caused by non-collisions. Bodily injury coverage, on the other hand, covers injuries suffered by other people in an auto accident when you are at fault.