What is Commercial Auto insurance and why should I have one?

What is Commercial Auto insurance and why should I have one?

Commercial Auto Insurance is very similar to personal auto insurance. However, this insurance covers events and situations specific to cars adapted or used only for commercial purposes.

Imagine that, after a lot of effort, you finally bought a car to deliver to your restaurant. During delivery, your employee slips on ice and ends up destroying a house fence.

The company car breaks down and needs a tow truck to the repair shop. The homeowner needs the fence repair and is still threatening to sue the company for the damage.

Seems like a big mess, right? All the necessary actions cost a lot of money, and getting sued costs even more…

If the company car only has private insurance, nothing will be covered as this insurance does not cover events during commercial activities. That is, all the damage will come out of the company’s coffers, or even out of your pocket.

Auto Insurance 101: All About US Auto Insurance

And how to avoid this inconvenience and this damage, which is often unrecoverable?


Commercial Auto Insurance, like personal insurance, is a policy that provides coverage for physical and liability damages caused by a corporate vehicle.

Do I need Commercial Auto Insurance? Why can’t I use the staff?

Certain uses are not covered by your personal auto insurance.

Therefore, you don’t want to be stuck in a pinch and find that you will have to pay out of pocket the costs of a lawsuit or medical expenses of the victim of an accident that occurred while moving your food truck.

Accidents during business activities are only covered by business insurance.

A good rule of thumb is to consider whether the vehicle is being operated for activities directly related to work.

If it is, you’ll likely need business auto insurance coverage.

Remember: driving a vehicle to and from work is not a business activity.

In this case, it is personal auto insurance that works.

Who needs that insurance?

To make it clearer and more crystalline, we separate some cases in which it is very important to hire a Commercial Auto Insurance. Consider hiring if you:

  • Own, lease or rent vehicles such as cars and trucks.
  • It has employees who drive their own vehicles to conduct business.
  • It has employees who operate leased, rented or own vehicles.

Which vehicles are covered?

Despite being commonly associated with trucks and utility vehicles, Commercial Auto Insurance can and should be done for any vehicle used for commercial purposes.

Among them are:

  • Box trucks – Trunk truck
  • food trucks
  • delivery vans
  • utility trucks
  • corporate cars

It is important to have the right insurance for every commercial vehicle.

So whether you’re using a four-door sedan for travel and business meetings, or if you’re towing a few tons of cargo in a large delivery truck, the coverage won’t be the same.

That is, when hiring your insurance, make sure that the coverage is adequate for the way your company uses the vehicle.

The policy also includes coverage for employees who operate the vehicle and possibly for previously included internal equipment.

What does Commercial Auto Insurance cover?

As a personal policy, the insurance offers coverage as varied as liability, collision, comprehensive and medical costs.

However, as it is commercial, the coverage, limits and exclusions are different, since it is necessary to consider the company-employee relationships, the responsibilities of the vehicle’s conditions, in the choice of who drives it, in the activity that the car will be necessary for…

types of coverage

Bodily injury liability coverage – pays for bodily injury or death resulting from an accident for which you (or the hired driver) is at fault and, in most cases, provides you with a legal defense.

Property damage liability coverage – provides protection if your vehicle accidentally damages someone else’s property and can also provide legal defense.

Combined single limit (CSL) – liability policiestypically offer separate limits that apply topersonal injury claims for property damage . A single limit combined policy has the same dollar amount of coverage per covered event, whether personal injury or property damage, one person or multiple.

Medical payments, no-fault or personal injury coverage – generally pays the medical expenses of the driver and passengers of the vehicle caused by a covered accident, regardless of who is at fault.

Uninsured motorist coverage – pays for injuries to anyone driving your car and, in some cases, also pays for property damage caused by an uninsured motorist or pedestrian being hit by a car.

It may be that underinsured driver coverage is also included.

This is for when the guilty driver has insufficient insurance.

Comprehensive coverage – pays for damage to your vehicle from theft, vandalism, flood, fire and other covered hazards.

Collision coverage – Pays for damage to your vehicle when it hits or is hit by another object.

Is that you? How are you protecting your company’s assets?


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