5 Things You Need To Understand About Commercial Auto Insurance

If you are a business owner and you use vehicles to conduct company business, you need a commercial auto insurance policy. A commercial auto insurance policy is vital for businesses that drive vehicles at all for business purposes. The right policy will provide you with the protection you need to keep your business running smoothly and to help ensure that you have the protection you need, no matter what happens. 

Who Needs Commercial Auto Insurance

Most states require that businesses with company vehicles carry commercial auto insurance policies. Personal auto insurance policies do not cover the use of the vehicle for business. You need a commercial policy, even if a vehicle is only used part-time for commercial purposes. 

There are a few exceptions to this rule. If you let employees use their own employee vehicles for business usage, or if you lease vehicles for business usage, then instead you are going to need a hired and non-owned auto insurance policy instead of a commercial auto insurance policy. 

How Much Commercial Insurance You Need

How much commercial insurance you need depends upon your business and where it is located. Each state has its own requirements for the amount of coverage you need to carry. There are three different types of coverage one is usually required to carry: 

• Bodily injury liability
• Property damage liability
• Uninsured Motorist coverage

You need to carry at least the minimum amount of coverage as required by the laws of your state. However, if you want to really protect your business, it is generally a good idea to purchase more than the minimum, so if your business is faced with a large claim, you can handle the claim without your business going under. 

Covering Personal Vehicles

If you are driving a personal vehicle for business usage, you need to purchase a hired and non-owned auto insurance, known as HNOA, for your vehicle. This is not required by law. However, if you get into an accident while doing business work, and your insurance discovers this information, your claim could be denied, and you will have to pay all damages out of pocket. This could put your business and personal assets at risk. 

Be smart and protect yourself with the right insurance policy. All vehicles you use for work purposes should be covered by a commercial auto insurance policy, or a non-owned auto insurance policy as appropriate. The right insurance policy is vital to protecting your business and your assets.  

For more information, talk to a local agent about commercial auto insurance.