Commercial auto insurance, often known as business or commercial vehicle insurance, covers automobiles used in a business setting.
Commercial auto insurance is similar to private auto insurance in that it protects against financial loss but is designed for vehicles used in a corporate environment. Different rules apply to trucks, cement mixers, and trailers to accommodate the wide variety of commercial vehicles on the road today.
Commercial auto insurance is recommended if you regularly use your car for business purposes or if your company owns a fleet of vehicles. Commercial auto insurance is utilized by business people in all fields, from construction to pizza delivery, because personal auto policies do not extend to commercial cars.
Including coverage, criteria, and pricing, this article will explain the fundamentals of commercial auto insurance. This article will also help you pick the best auto insurance policy for your needs, whether you need protection for a fleet of taxis, construction vehicles, or just your car for frequent business trips.
Liability insurance, which covers medical expenses and repairs to other people's vehicles, is required by law in most jurisdictions. While the specifics of commercial auto insurance regulations may vary by state, in most cases, businesses are expected to provide at least the same level of coverage as private motorists.
The state of California mandates that all licenced drivers carry liability insurance with limits of at least $15,000 per person injured or killed, $30,000 per accident, and $5,000 for each incident involving property damage. Proof of insurance must be carried out and made available to law authorities upon request.
New York has some of the strictest insurance minimums in the country. It also has more stringent minimum limits for liability coverage on auto insurance policies. Individual limits must be at least $25,000, with limitations of $50,000 for numerous injuries, $100,000 for multiple deaths, and $10,000 for property damage for each driver. No-fault and uninsured motorist coverage are both mandatory in the state of New York for drivers.
Commercial auto insurance covers many costs caused by many different things. This section goes over the details of commercial auto insurance coverage.
As we've already discussed, commercial auto insurance policies can cover personal and business vehicles and different types of vehicles standard in other industries. These include passenger cars, vans, pickups, SUVs, cement mixers, hauliers, cranes, various trucks, delivery vans, tractor-trailers, flatbeds, and many more. Commercial truck insurance is a commercial auto insurance policy made just for trucks.
A crucial part of commercial auto insurance is coverage for bodily injury liability. It pays for the costs of other people getting hurt in an accident where an employee or another covered driver was at fault. Some covered costs would be medical and rehabilitation costs, lost wages, legal fees, and even funeral costs if the accident was fatal. In California and New York, you must pay $30,000 and $50,000 for bodily liability. Most commercial auto insurance policies have much higher limits. Also, it's important to remember that the quoted limitations for liability policies apply to each vehicle on the policy.
Property damage liability insurance supports damages to other people's property that a covered driver causes. If you damage someone else's vehicle or property, this part of the policy will pay to fix or replace the damage. Buildings, cars, fences, mailboxes, landscaping, and other things could be among the damaged property.
Most states require property damage liability coverage, but the limits are lesser than those for bodily injury liability. The required coverage limit in California and New York is $5,000 and $10,000, respectively. These amounts are just a tiny part of the requirements for bodily injury liability. Most states require both property damage liability and bodily injury liability coverage, so they are often bundled together into one liability insurance package for vehicles.
Physical damage coverage pays to fix or replace the policyholder's cars and other property after an event covered by the policy. Many subcategories of bodily damage coverage describe the kinds of accidents and damages covered.
There are different kinds of physical damage coverage. Collision coverage pays for damage caused by a crash or roll. Comprehensive insurance pays for damage that isn't caused by a collision, like theft, fire, bad weather, or vandalism. Fire and Theft and Combined Additional Coverage are usually for large trucks and construction vehicles. It is a limited comprehensive coverage version covering a smaller range of incidents.
Physical damage coverage only pays for damage to the policyholder's cars, so most states don't require it. But it is a valuable part of any auto insurance policy because it helps avoid the high costs of fixing or replacing a car after an accident or theft.
Medical payments coverage pays for medical bills if an accident hurts the policyholder, company employee, or a covered vehicle passenger. Some parts that are covered are medical bills, lost wages, and even funeral costs. Most states don't require this kind of insurance, but it's a must if you don't want to pay a lot of medical bills after a severe accident that is covered.
After an accident, the insured person's health insurance may or may not pay their medical bills. Even if the person hurt was at fault for the accident, medical payments coverage will always be helpful.
Personal injury protection (PIP) pays for medical bills if the policyholder, an employee of the business, or a passenger gets hurt in a crash covered by the policy. After an accident, medical payments coverage only pays for medical bills, but PIP coverage pays for both medical bills and loses money for the insured and passengers. PIP coverage will pay for personal injury costs, even if the accident was the insured's fault or the fault of a third party.
In some "no-fault states," like Delaware, New Jersey, North Dakota, New York, Florida, Kansas, Kentucky, Hawaii, Pennsylvania, Utah, Michigan, Massachusetts, Minnesota, Oregon, and Texas, PIP insurance is required.
Most of the time, PIP is only available in "no-fault" states, and most, if not all, insurers won't let businesses have both PIP and medical payments coverage simultaneously.
Uninsured motorist insurance covers the costs of injuries to the policyholder, an employee, or a passenger who doesn't have insurance. After an injury, the at-fault driver's insurance will pay for everyone's medical bills and property damage. The coverage will pay for the damage and medical bills if the driver who caused the crash does not possess insurance.
Even though liability insurance is needed in most states, about one out of every eight drivers doesn't have it, as per the National Association of Insurance Commissioners (NAIC). It means there is a high risk of accidents with uninsured drivers.
Commercial auto insurance premiums are very different and depend on many things. There are a lot of differences, but most small businesses will pay less than $2,500 per vehicle per year.
Several things could affect your premium, such as:
1. Auto' makes, models, and ages
2. Cost of the auto
3. Usefulness of the auto
4. Driving record
5. History of claims
6. Limits of coverage and deductibles
Many businesses should have at least $500,000 to $1 million in commercial auto liability. A commercial umbrella policy may be a good idea to give your business strong protection to add to this liability.
When it comes to ensuring trucks, vans, and other commercial vehicles, Progressive Commercial is a great choice. Both AM Best and Standard & Poor's have given Progressive high marks; the former gives it an A+ grade, the latter an A.A. Progressive offers a wide range of discounts and perks, as well as coverage that may be tailored to your needs for cars, trucks, and trailers.
Progressive also provides a service called Snapshot ProView, which encourages safe driving by rewarding policyholders who demonstrate this behaviour with lower premiums. Free fleet management tools are available to companies with three or more vehicles.
Liberty Mutual is the second-largest insurance company in the United States.
It is a top property and casualty insurer, with an A rating from both AM Best and Standard & Poor. According to a J.D. Power study of small business clients who purchased commercial products, Liberty Mutual is above the industry average in customer satisfaction.
As one of the many perks it offers its commercial clients, Liberty Mutual's risk control services may help ensure the safety of its drivers. With telematics data, larger fleets can keep tabs on their drivers' routines. Liberty Mutual also has a mobile app for submitting images of vehicle damage and receiving an insurance quote.
The Hartford is a highly well-liked commercial insurer, with an A+ rating from both AM Best and Standard & Poor. The Hartford may provide your business with services like analyzing your company's driving records and making recommendations to boost safety. The Hartford's FleetAhead programme will help you find the root causes of accidents and reduce your premiums if you use telematics technology.
The Hartford's commercial insurance is sold through a network of agents and brokers and features online claim reporting.
Geico has the cheapest commercial auto insurance. Both Standard & Poor's and AM Best have given it high marks for its financial stability, giving it a grade of AA+ and a grade of A++, respectively. The parent firm of this insurance provider came in at number two in J.D. Power's most recent study of large commercial insurers for customer satisfaction and number thirteen in their 2020 survey of U.S. vehicle insurance claim satisfaction.
Auto insurance prices and policy access are available quickly and easily online with Geico. Fleets of any size can have policies tailored to their needs, and the vast majority of vehicles are covered (including cars, vans, and trucks, but not semis or tractor-trailers).
Geico provides combined single limits for liability coverage and the other coverage levels typically available in auto insurance policies. This policy offers the same coverage for an occurrence, regardless of injuries or property damage. Rather than having separate limits (maximum amounts of money the insurer would pay for a single claim) for bodily injury and property damage claims.
AM Best has given Auto-Owners Insurance their highest possible grade of A++ for financial stability. The company has a good recognition for customer service and was ranked third in the nation for auto insurance claim satisfaction in J.D. Power's 2020 survey.
Remember that Auto-Owners Insurance is only sold in 26 of the 50 states. You'll have to contact an independent agent if you want a quote from Auto-Owners. Auto owner's insurance coverage automatically covers newly purchased vehicles. Coverage for breakdowns, gaps in a loan or lease, and more are available through various policies.
Discounts are available from Auto-Owners Insurance for things like having numerous policies with the company, paying your premiums in total, and having your fleet monitored by telematics. There are seasonal price reductions for farm vehicles as well.
Commercial auto insurance is the first measure in defending your organization from unexpected charges and losses. Every company is unique and is vulnerable to a variety of distinct hazards. Insurance is not a versatile solution. Talk to insurance specialists before you acquire plans.
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Progressive
Commercial auto insurance is usually between $800 and $1,200 per vehicle annually.
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