How Do Commercial and Personal Auto Insurances Vary?

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Commercial auto insurance protects small businesses from paying out of pocket for damages caused by employees while using their vehicles for work purposes. This policy is a must for any business that uses vehicles in its day-to-day operations. This type of insurance protects against damage to both the business's vehicles and those of others. Liability and physical damage coverages are the most common, but others may be specific to your industry.

Remember, when looking at commercial and personal vehicles, one type is used more often than the other. This is especially true concerning logistics and courier services, where their vehicles travel long distances and suffer more wear and tear.

There are a few key indicators you may need commercial auto insurance instead of a personal one. These include if you use your vehicle for business purposes, transport goods or passengers for a fee, or have a fleet of vehicles. If you're unsure whether you need commercial auto insurance, it's always a good idea to ask an insurance agent for clarification.

The Considerations

  • Vehicle Use: Commercial auto insurance is designed to cover businesses and employees' risks when using vehicles for business purposes. This can include business-owned vehicles, those rented, leased, or borrowed, and even employees' vehicles used for business. This policy can help protect your business from the financial losses resulting from accidents, vehicle theft, and other risks.

If you use your vehicle for work, your company may have commercial auto insurance covering you. Ask your manager or another person at your company to ensure you are covered when driving your car for work.

Commercial auto insurance is a policy not typically included in a business owner's. However, it can be purchased separately, and most states require businesses to have a minimum amount of commercial auto insurance. This type of insurance protects businesses from risks on the road.

  • The Driver: Personal auto insurance is insurance that covers vehicles that are owned by individuals and used for personal purposes. It typically does not cover vehicles that are used for business purposes.

This type of insurance will cover any damages if an employee drives the vehicle for business purposes.

  • Liability Needed: Commercial insurance policies offer higher liability coverage than standard auto insurance. This insurance is typically used to protect businesses from potential financial losses if one of their employees were to cause an accident.

  • The Vehicle Type: Commercial insurance for heavy-duty vehicles protects businesses that use these types of vehicles. This insurance is typically more expensive than regular car insurance because these vehicles can cause more damage than a typical car.

  • The Vehicle Owner: If you own or lease a business vehicle, you will most likely need commercial auto insurance. This policy differs from personal auto insurance, so it is important to speak with a licensed insurance agent to determine if this is the right option.

  • Sole Proprietorship: Commercial auto insurance protects vehicles used for business purposes, whereas personal auto insurance is typically for vehicles used for personal use.

This means that you can add business uses to your auto insurance policy.

Ensure You Get the Right Policy with Brand and Britt Insurance

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