As a business owner, you need the same kinds of insurance coverage for the car you use in your business as you do for a car used for personal travel—coverage that includes liability, collision, and comprehensive coverage; medical payments (known as personal injury protection in some states); and uninsured motorist coverage. This is where commercial auto insurance comes in.

What Is Commercial Auto Insurance?

When you buy a vehicle (or fleet of them) for your company, or even allow an employee to operate their own vehicle on your behalf, then your business could be the one to suffer if something happens to one of those drivers or vehicles. Commercial auto insurance is designed to provide you with financial assistance, and as a result your company won’t face financial setbacks just because an accident occurred.  

Why Do You Need Commercial Auto Insurance?

Whether you need to buy a commercial auto insurance policy depends on the kind of driving you do. A good insurance agent will ask you many details about how you use vehicles in your business, who will be driving them, and whether employees, if you have them, are likely to be driving their own cars for your business.

Who Needs Commercial Auto Insurance?

Commercial auto insurance is designed specifically for vehicles and drivers operating on behalf of a business. Though very similar to personal auto insurance, a commercial auto policy will contain specialized coverage terms that are designed to protect the company’s investment in the vehicles.  
Various vehicles and drivers might need to be covered by a commercial auto policy. These include:  

• Vehicles owned by a business

• Employees who drive their personal cars on business-related errands

• Company cars provided to employees for commercial and private use

• Vehicles hired or rented by the business

• Certain personal vehicles that qualify as commercial due to their weights or sizes

 

Things to Consider and Questions to Ask Your Agent

Consider whether you use the same vehicle for both business and pleasure. If the vehicle is owned by the business, make sure the name of the business appears on the insurance policy as the “principal insured,” rather than your name. This will avoid possible confusion in the event that you need to file a claim, or a claim is filed against you.

While the major coverages are the same, a business auto policy differs from a personal auto policy in many technical respects. Ask your insurance agent to explain all the differences and options. 

 

Don’t take a risk when it comes to coverage for vehicles used for business purposes. The experts at Cameo Insurance can help you understand whether you need a commercial auto insurance policy and will work with you to find you the best rate with a reputable insurance company. We’ve helped countless business owners across Greater Los Angeles—from Inglewood, to Culver City, to Hawthorne, to Santa Monica. We look forward to becoming your trusted insurance agent. Request a quote today!