Most small and local businesses operate with a single designated vehicle used to transport goods and workers to the job site. Even if you don’t have a business, but you do spend a lot of time driving from one job to another, a commercial insurance policy might be an excellent addition to your personal policy.
Almost everyone who uses a car for work can apply for a commercial auto policy that offers higher rates and better coverage. Stay with us, and we’ll explain how it works and why you should apply for it as soon as possible.
What is Commercial Auto Insurance?
In short, you need commercial auto insurance if your vehicle is owned by your business or if the vehicle you drive belongs to someone else’s business. The insurance covers all costs if an accident occurs while you’re on the job. It covers multiple types of vehicles and more complicated legal issues. It also covers all business employees as additional insureds as long as they own a driver’s license.
If you’re self-employed and if you use your vehicle primarily for business purposes, you can still apply for the commercial auto insurance policy. It does have higher liability limits than personal auto insurance, and it’s used for vehicles that:
- Transport goods and equipment
- Drive clients and employers
- Any service you are paid for
- Haul heavy loads
- Tow trailers used to run a business
What is Personal Auto Insurance?
Personal auto insurance is the type of insurance issued to every driver. It only covers accidents that happen when you use the vehicle for personal purposes. If an accident happens on your way to work, a road trip, or any other situation when you’re not working are all covered by this insurance.
Finding The Right Insurance Policy For Your Needs
If you’re not sure if you can apply for a commercial auto insurance policy, here are a few questions that will help you figure that out.
1. Who is the vehicle owner, and who drives it?
If you own a business, you will have to get a commercial auto insurance policy for sure. On the other hand, if you’re self-employed, a personal auto insurance policy should be enough. However, if you use your vehicle all the time and if you cover greater distances, a commercial insurance policy is the best option.
2. Vehicle Use
If you use the vehicle only for business purposes, a commercial auto insurance policy is a must. Even if you’re self-employed, but you have to drive to multiple job sites every day, you can still get a commercial policy, even though a personal auto insurance policy could be enough.
3. Vehicle Weight and Type
If you drive any vehicle that is heavier and larger than a standard SUV, you might need a commercial auto insurance. Heavier vehicles can cause more damage which may require coverage that is not provided by personal auto insurance.
4. Business Liability Limits
If your business requires higher liability, a commercial auto insurance policy is the best choice. It comes with higher limits than standard personal auto insurance.
The Bottom Line
If you don’t own a fleet of vehicles used to run your business, you can still benefit from a commercial auto insurance policy if your job requires you to drive a lot, haul heavy equipment, own a larger vehicle, or even drive clients. A commercial auto insurance policy has higher coverage and covers more complex legal issues. If you fit in any of the categories above, getting commercial auto insurance might save you from a lot of headaches and huge expenses if an accident occurs while you’re on the job.
