What Is Commercial Auto Insurance? Benefits, Cost And Coverages

Commercial Auto Insurance Benefits, Cost, And Coverages: Commercial auto insurance is basically a policy of physical damage as well as liability coverages for the amounts, circumstances, along with users that are not covered by a personal auto policy. It is very important for every business person to know the difference between a personal auto insurance policy and a commercial auto insurance policy for their business.

What is Commercial Auto Insurance?

Commercial auto insurance is the liability and physical damage and physical damage protection for Vehicles including Cars, Vans, Trucks, which are used for Business or Commercial Purpose. Commercial vehicles need a separate policy because they are exposed to More risk than personal vehicles.

This type of business insurance includes a variety of vehicles such as from automobiles used for business, comprising company cars, to a wide-ranging of commercial trucks.

Commercial auto insurance is required in order to cover the cars, trucks, as well as vans that are used in accompanying your business. Large fleets, along with small businesses, should be appropriately covered by a commercial auto insurance policy.

How Does Commerce Auto Insurance Work?

Any business owner can purchase commercial Auto coverage for a single vehicle or for the entire fleet. Before purchasing the Policy the Business must define what coverage it needs and to what extent. anyone can work with the representative from the Insurance company to determine the following elements of the Insurance Policy:

  1. The maximum amount of money which is the issuer is able to required to pay on the Policy.
  2. The Monthly cost of retaining the Insurance Policy.
  3. The types of damages, incidents, and expenses can be covered.
  4. the deductible amount which the Company must pay towards a claim before the coverage becomes available.

Businesses need to check for balanced policies that combine adequate coverage and policy limit with reasonable and monthly Premiums. after any business purchase commerce Auto Insurance Policy, the policyholder start to paying the Monthly Premiums and in returns Insurance companies agree to pay for any loss, damages, repairs, medical or legal expenses that are associated with the covered incident according to Policy Terms and Conditions.

What are the Benefits of Commercial Auto Insurance?

 The first benefit is that the premiums on your commercial vehicle policy can be tax-deductible, you can find many other tax benefits since you now have a small business.

With the help of this insurance, you can use a business address in an area with no money down car insurance.

If you want you can also have numerous drivers on the policy who do not live in your household.

You also don’t have to go through several procedures where your credits are checked as there are some companies that sell commercial vehicle policies without checking the credit of the individuals or the business credit in order to determine the premiums.

Also, with the help of this insurance, you can have several vehicles on the policy deprived of a match with the drivers. For instance, with a commercial policy, you are allowed to have 6 vehicles on the policy with only two drivers.

What Is Commercial Auto Insurance? Benefits, Cost And Coverages

What are the Prerequisites required before getting commercial auto insurance?

In order to get a commercial auto policy, you must have the following:

  • Your vehicles must have been registered in the name of your business.
  • A federal tax identification number.
  • Some companies might also accept your social security number if you are a sole proprietor.
  • After obtaining these things you can search out for the best rates for commercial auto insurance.

Questions which you will be Asked

Here are some of the questions which you will be Asked:

  • Business Address and Phone Number
  • Tax ID Number
  • What type of business you have?
  • Is there any of the vehicles used for personal driving?
  • Where are the vehicles garaged?

What are the Discounts you can Receive under a Commercial Vehicle Policy?

You can also receive some discounts under a commercial vehicle policy and some of the discounts are as follows:

  • Previous insurance or transfer credit
  • Upper liability restrictions
  • No judgments, liens, or insolvency
  • No moving violations
  • Being in business for more than a year
  • All drivers more than 21 years of age
  • Airbags as well as alarm systems

What are the Coverages in a Commercial Vehicle Policy?

Here is the list of coverages in a commercial vehicle policy and these are as follows:

  • Bodily injury liability coverage
  • Property damage liability coverage
  • Combined single limit (CSL)
  • Medical payments, no-fault or personal injury coverage
  • Uninsured motorist coverage
  • Comprehensive physical damage coverage
  • Collision coverage

Commerce Auto Insurance vs. Personal Auto Insurance: Difference

Commercial Auto Insurance Personal Auto Insurance
Intended For
  • Vehicles owned by a business
  • Vehicles used to conduct business
  • Vehicles owned and used by individuals and families
  • Liability
  • Physical Damage
  • Medical
  • Under/Uninsured Motorist
  • Liability
  • Physical Damage
  • Medical
  • Under/Uninsured Motorist
Covered Vehicles
  • Passenger Cars
  • Vans
  • Pickups
  • SUVs
  • Delivery Vans
  • Cement Mixers
  • Haulers
  • Cranes
  • Various trucks
  • Passenger Cars
  • Vans
  • Pickups
  • SUVs
Covered Parties
  • Employees
  • Individuals (policyholders)
  • Friends / Family
Annual Cost per Vehicle
  • Passenger vehicles: $800-$1,200
  • Semi Trucks: $1,500-$2,500
  • Taxis: $3,000-$10,000
  • Passenger vehicles: $800-$1,200
  • One policy limit for all vehicles
  • $1,000,000 + total
  • One policy limit, one vehicle
  • $30,000 +  per vehicle
  • Bodily Injury Liability
  • Property Damage Liability
  • Federal requirements for interstate trucking/transport
  • Bodily Injury Liability
  • Property Damage Liability
  • Personal Use
  • Business Use

Final Verdict

Commerce Auto Insurance is the type of Car Insurance meant for Vehicle which is used for Business purposes but not Personal use. Commercial Vehicle Insurance has many of the same coverage components as Standard Auto Insurance. If You are the Car or Truck for Work then you will need a Commerical Auto Insurance Policy to Cover You while You are on the Clock. Commerce Auto Insurance covers your Car or Truck and can be extended to cover your employees even when they are driving their own vehicles. Commerce Auto Insurance tends to be more expensive than personal car Insurance but you can qualify for Discounts just like with your regular Personal Policy. there are a lot of companies that sell Commerce Auto Insurance like Allstate, Geico, Progressive, and AAA also sell commercial Auto Insurance Policies.