A commercial auto insurance policy is an important insurance coverage needed for businesses with company vehicles used by various employees. Commercial auto insurance is very similar to a personal auto insurance policy, but is written and rated differently to ensure that your company is protected from physical damages and liabilities which may not be covered in a traditional personal auto insurance policy. A commercial auto insurance policy is typically more flexible as it provides coverage for business, personal, non-owned or hired vehicles based on coverages uniquely written, purchased and applied to each scheduled vehicle. This makes it possible for a business to have particular coverages which are designed and written specifically for the needs of each vehicle. A company may not need the same level of coverage for a company car issued for an executive’s personal use as it would for a company van making several deliveries in possibly higher risk situations. These types of unique situations makes the commercial auto insurance policy flexibility advantageous over a traditional personal auto insurance policy. Each vehicle has a related symbol classified by the vehicle’s use and weight, and most commercial auto insurances policies offer separate bodily injury and property damage coverage limits at higher limits. These auto symbols are listed as follows:
1. Any auto. This rating covers most traditional automobiles.
2. Owned auto only. This symbol covers any auto which is personally owned by the insured. It may also cover any trailer towed by an owned vehicle.
3. Owned private passenger auto only. This will cover private passenger auto.
4. Owned autos other than private passenger autos. This policy will cover all owned vehicles not designed to be passenger vehicles such as, vans, trucks, motorized equipment.
5. Owned autos subject to no-fault. This may include vehicles which are garaged or in states which recognize no-fault laws.
6. Owned autos subject to a compulsory uninsured motorist law. This policy is designated for any auto which is garaged or licensed in a state where drivers are required to have uninsured motorist coverage.
7. Specifically described autos. These autos must be listed in the policy to be covered, and can include trailers towed by listed vehicles.
8. Hired autos only. This policy will cover any autos leased, hired, rented or borrowed by the insurer, but does not cover said autos of an employee, partner or member of an insured’s household.
9. Non-owned autos only. This policy will cover autos not owned by insurer but may be owned by employee, partner, or member of insurers household.
Most commercial auto insurance policies offer a general liability option which is comprehensive in nature. This type of coverage is designed to protect against all hazards within the scope of the insuring agreement. Commercial auto insurance policies which include commercial general liability are also comprehensive in that they will automatically cover new locations and activities as your business grows and expands. These types of policies are offered in three distinct policy options: premises liability, products liability, and completed operations.
A commercial auto insurance policy is recommended for any company that:
1. Uses a vehicle to transport goods or people for a fee or service
2. Requires higher limits of liability
3. Hauls large amounts of weight in tools or equipment
4. Employs people who may operate vehicles which are owned or in the name of the company.