Commercial Auto Insurance

Getting to Know Commercial Auto Insurance

Being a business owner, it’s important to have insurance coverage for your trucks, cars, vans or any other vehicles used to run your company. Most states require you to buy liability insurance for property damage and injuries that can result from an accident while you or your employees are driving when doing business. Uninsured/underinsured coverage and medical coverage is also needed. It’s also advisable to buy physical damage cover for autos that your business leases or owns.

Each auto you use may be listed on your commercial auto insurance policy or separately. In other words, it’s possible to have different coverages depending on the characteristics of vehicles and what the coverage is needed for.

The insurance agent asks for the details on how you use the vehicles of the business; whether you rent, lease or own them; who will drive them; and if you and the staff members will likely drive personal vehicles for your business. Answers to these questions indicate the kind of coverage you need.

Ensuring the right insured is on the plan

On the insurance contract, the owner of the vehicle is named as the “principal insured” under the “declarations.” In case you drive the same vehicles for business and pleasure, you must inform the insurance agent holding the title of the vehicle. This helps you to avoid issues whenever you have to file a claim or when a claim is filed against you.

Liability when you let a bad driver drive your vehicles

If you allow someone else to drive one of your vehicles, you will be liable for any damage or injury. It is your duty to take the necessary steps to know that everyone who drives the vehicles has an excellent driving record. If an accident occurs, you will be accountable for negligent entrustment. All the damages associated with negligent entrustment will be added on top of legal responsibility for the accident itself.