One common oversight many small business owners make is not getting commercial auto insurance when it is needed. Obviously, a large business needs commercial vehicle insurance because company cars are used on a regular basis to make deliveries or for other business purposes.
As a small business owner, did you know you also need commercial car insurance if you transport clients or deliver products in your personal car? There is a very thin line between personal and business use, which in turn dictates the type of auto insurance a business needs to be fully protected.
Whether or not you need commercial auto insurance for your business can sometimes be confusing. You may not need it for running a few business errands such as getting office supplies, going to the post office, or even picking up coffee for the staff. You likely do not need it when driving short distances to and from nearby work sites for business purposes.
When do you need commercial car insurance? To protect your company, a commercial auto policy should be added if you use your car or any other vehicle for business purposes. This includes making deliveries to customers, transporting fares (such as in rideshare programs), driving long distances to and from work sites or business locations on a regular basis, and carrying work equipment to and from work sites.
You must also have a commercial vehicle insurance policy in place if your business transports clients in any way. Whether a vehicle is owned by you or the business, regular business usage or the situations cited above does require commercial coverage. In addition, any vehicle that is obviously designed for business use needs commerical auto insurance.
There is a big difference between personal and commercial auto insurance and what each type of insurance covers. Personal policies cover normal, day-to-day vehicle use and have policy limits that correspond with incidents that daily driving might encounter. They do not cover activities that can be classified as those used for business purposes.
Commercial car insurance provides higher liability and property damage coverage for vehicles used for business reasons. Commercial vehicles are generally used more often and see different types of usage than a personal vehicle, which makes them more susceptible to damage and involvement in an accident. Some business vehicles, such as those used to transport goods or supplies, have a higher risk of theft or vandalism. Even those used to transport clients spend more hours on the road with people other than the vehicle owner.
When you or your employees drive clients back and forth, commercial vehicle insurance is a required protection. In addition to facing greater risks of vehicle damage, businesses also face higher liability risks. A commercial policy with higher liability coverage can protect your company against potential lawsuits that could arise if you or one of your employees is involved in an accident while performing business duties.
Before you decide that your business does not need commercial auto insurance, take a few minutes to think about the various activities you and your employees perform for the business. Discuss the use of your vehicle with a commercial car insurance agent who can help you determine if you need a commercial policy for your vehicle. With the right commercial vehicle insurance in place, your business can be protected against damaging lawsuits if an accident were to happen!
For more information, please visit Transport Vehicle Covers.