What is Commercial Auto Insurance?

Woman Signing Contract at Dealership

What is commercial auto insurance, and what does it mean for your Northern Chicago-area business? Simply put, commercial auto insurance is a special type of insurance policy that covers liabilities and physical damages to both property and persons. Although the types of protection it offers are not too different from those offered with personal auto insurance plans, commercial plans generally allow for higher coverage limits and are governed by different rules and limitations.

What’s Covered by Commercial Auto Insurance?

Commercial insurance can cover almost any vehicle that is owned by a business and driven by either the owner or employees for work-related activities. Here’s what’s covered by commercial auto insurance under most policies:

  • Liability coverage for both property damage and injuries to persons
  • Personal injury coverage for the driver or any passengers in your vehicle, regardless of who was at fault
  • Collision coverage which protects your vehicle when it is damaged in an accident, regardless of who was at fault
  • Comprehensive vehicle coverage for damages not caused by an accident, including theft, vandalism, or natural disasters
  • Uninsured motorist coverage which ensures that you’re protected against damages, even in cases where you were hit by an uninsured or underinsured driver

Does Commercial Auto Insurance Protect Other Drivers?

Commercial auto insurance follows the vehicle and protects any employees or family members who drive the vehicle. Most commercial auto insurance policies do not limit the number of vehicles that you can include on your plan. Likewise, the number of covered drivers is not usually limited.

Are Trailers and Tools Covered by Commercial Auto Insurance?

Trailers with a Gross Vehicle Weight Rating of less than 2,000 pounds are usually covered in commercial auto insurance policies. Heavier trailers will need to be added to your policy separately, and any tools and materials you’re hauling will likely not be covered.

When Do You Need Commercial Insurance?

  • Any vehicle that’s used for work purposes may qualify as a commercial vehicle.
  • Larger vehicles, including dump trucks, work vans, and heavy-duty commercial pickups generally require commercial auto insurance.
  • This is partly because these sorts of vehicles tend to incur higher liabilities in the event of an accident, and most states set limits for the amount of liability coverage that personal insurance policies can offer.
  • However, even smaller vehicles, including company cars, may require a commercial insurance policy.
  • Even if you personally own the vehicle that your employees are driving, commercial insurance is likely a necessity.

Not sure if you need commercial auto insurance? Call us today at (262) 514-4000 or explore more of our car buying and insurance tips online.

Calculator Money and Car Key

What is the Average Cost of Commercial Auto Insurance?

The average cost of commercial auto insurance is just over $900 per year, although costs can range from $750 per year, on the low end, to $1,200 per year or more. This cost is generally accounted per vehicle.

Are you hoping to lower your commercial auto insurance cost? Here, we’ve highlighted some of the most common reasons that business owners end up paying more:

  • Insuring vehicles with a gross vehicle weight rating of more than 10,000 pounds
  • Operating within a wide radius, or offering rapid delivery options
  • Owning or operating other vehicles with recent tickets
  • Employing drivers with less-than-stellar driving records

Let Our Team Answer Your Questions!

The Lynch Truck Center is the go-to source for all things related to commercial trucks and work vehicles. If you’re near Racine or Milwaukee, you can reach out to our financing center whenever you’re in need.

Other Financing Tips

Lynch Truck Center , .