How Does Commercial Auto Insurance Work?
Commercial auto insurance works like other auto plans. You take out a policy to protect your vehicle against common perils. You can also protect your tools, equipment, supplies, and goods you transport. If you have an accident or are victim of a theft, you can open a claim to recuperate from the financial loss.
What Does A Commercial Vehicle Insurance Policy Cover?
It covers damage and accidents. It provides you with protection against damage and being liable if you are involved in an accident. This included medical payments for those injured in a crash. You also get protection for theft, vandalism, or damage by a third party.
Polices include protection if you or employees are injured, including medical expenses. You have coverage for goods when in transport to customers. You also get a replacement car for when it is being repaired.
What Are The Types Of Commercial Auto Insurance Policies?
There are three main types :
- Business use : This is common for a small business, home-based business or solo entrepreneurs. You use your car to drive to various locations and meet with clients. In this case, you add "business use" to your personal insurance.
- Business use for multiple drivers : This provides the option to add multiple drivers. It’s used when multiple employees use your vehicle, and the insurance is through the owner.
- Commercial auto use only : This is for people who have vehicles that are only for work purposes. You use it daily. You have added equipment and features. For example, a contractor adding a tool rack to their pickup.
How Much Does Commercial Auto Insurance Cost?
Determining the average cost of your commercial auto insurance is done on a case-by-case basis. There are many factors that contribute to how much you will pay. The number and type of vehicle, business type, limits and more are all considered. Plans could range from $100 per month to $300 per month or more.
Why Does Commercial Car Insurance Cost More?
Driving for work is associated with increased danger. This is a main reason why insurance premiums are higher. There are greater potential issues, larger plan limits, and a variety of expansive options that increase the cost for insurance. Commerce vehicles are used differently and more frequently.
Here are some reasons :
- They are used during peak traffic hours.
- They commonly have extra equipment and cargo.
- You are more likely to drive in unfamiliar areas.
- Multiple drivers.
- The MSRP is usually more expensive.
- They are a target for theft.