3 Red Flags Your Business Needs Commercial Auto Insurance
Own your own business or thinking about starting one? Commercial auto insurance is an expense you should strongly consider working into your budget. Commercial and personal insurance policies offer similar kinds of coverage, but there are important reasons to purchase commercial auto insurance for liability reasons. After all, commercial auto insurance is just one of many types of commercial insurance that could protect your business. Here are three reasons you could be a prime candidate for a commercial auto insurance policy:
1) Vehicles Are Titled to Your Business
If you only use a car or small truck to commute to an office, it’s likely that you are covered with your personal auto insurance policy. However, if you have one or multiple vehicles registered to your business, using personal auto insurance policies for these vehicles may not be a viable option because protection will likely not extend while driving for your business.
Commercial auto insurance has the added advantage of covering various employees who will use your vehicles for work purposes. As a business owner, you should have the right type of auto insurance to protect your business and your employees.
2) You Transport People or Items for Money
If you occasionally need to transport clients in your car (for example, as a real estate agent), you typically will be covered by your personal auto insurance policy. However, we recommend checking with a licensed insurance agent for this particular scenario. You may also need commercial insurance if you transport items for work, such as heavy tools or equipment. This might include business occupations such as:
- Electricians, plumbers, and HVAC technicians
- Carpenters, painters, and other contractors
- Landscaping and forestry services
- Caterers and food vendors
- High-mileage salespeople
- Commercial delivery services or trucking
For some of these professions, you will likely be driving a heavy-duty vehicle capable of carrying heavy tools or expensive equipment that requires coverage.
3) You Need Higher Liability Limits
If you’re driving for your small business under a personal auto policy, you’re exposing your company to a lot of risk should an accident occur. Without commercial auto insurance, you could be paying out of pocket for repairs, injuries, and more. If you use your personal vehicle for business, you could also have limited or no coverage for any incidents that occur—and/or you could lose your personal coverage.
4) How You Might Save With Commercial Insurance
If an employee gets into an accident that causes damage to a person or property, commercial auto insurance typically offers higher coverage limits. This means if your case is taken to court, your insurance could cover more of the lawsuit instead of needing to dig into your company’s budget to pay for damages and fees. A commercial truck can easily create more damage than a typical car, so it only makes sense that you’d want the highest coverage possible.
While business car insurance might not be cheaper than the personal kind, it could easily be an investment that pays for itself if needed. Commercial car insurance may also be counted as a business expense and therefore may be tax-deductible; however, every business should consult with their tax professional about this benefit because not every vehicle or driver may be eligible.
Who is Answer Financial?
If you have any more in-depth questions about commercial auto insurance, we’re your experts! Answer Financial has helped over 4 million customers find the right coverage for their homes and vehicles, including ATVs, motorcycles, boats and snowmobiles. Call 1-888-737-7000 to talk about policies with one of our insurance experts or visit our site to quickly compare quotes from over 40+ top-rated insurance companies.
December 2, 2021