COMMERCIAL AUTO Insurance
In many states, commercial vehicles are required to be properly insured per state law, and some vehicles also must comply with auto loan guidelines for insurance. A commercial vehicle may be any type of vehicle used for business purposes. Your own business may have one commercial vehicle or an entire fleet. All must be properly insured per state law to legally be on the road, but a typical auto policy will not cover your needs if the vehicle is involved in an accident during commercial usage. A closer look will tell you more about the types of commercial auto insurance available.
Commercial auto insurance requirements often vary based on the type of vehicle being insured as well as what activities the vehicle is used for. However, one of the more common legal requirements for commercial vehicle coverage is liability insurance. Liability insurance is unique from other types of commercial coverage that you may purchase because it only pays benefits for damages that you or your drivers cause to other parties. For example, if you or your drivers cause an accident, the coverage would pay for vehicle repairs for the other driver. It would not pay for your own vehicle repairs or other losses. Other types of commercial car insurance are needed for this.
Collision and comprehensive insurance are available for commercial vehicles. Collision coverage pays for your own vehicle’s repairs in the event of a collision-type accident only. Comprehensive insurance pays for collision damages as well as damages caused by theft, severe weather and more. One of these two types of insurance is usually required by an auto lender if you financed your commercial vehicles. In addition to these types of commercial auto coverage, you can also buy insurance for towing service, replacement vehicle coverage, gap insurance, personal injury coverage, vehicle contents and more. Because each state has unique requirements, some of these additional types of coverage may actually be required in your state.
Remember that you must at least buy enough commercial auto coverage to meet state guidelines and your lender’s requirements if you have auto financing. You may also increase your coverage limits or add optional coverage types as desired for additional financial protection on your commercial vehicles.