4 Things To Consider Before Purchasing Commercial Auto Insurance
A business insurance plan should also have a commercial auto policy under it. If you use vehicles in your business operation, it is important to buy commercial car insurance for your protection. Take a look at some of the considerations below before purchasing your policy.
What Kind of Cars Do You Use in Your Business?
There are two categories under the commercial auto insurance. These are:
- Private passenger-type cars
- Trailers, tractors, and trucks
Private passenger vehicles include station wagons, minivans, and sedans.
When it comes to commercial auto insurance, trucks have different sizes. These vehicles are subdivided into categories according to their GVW (gross vehicle weight). So, a light truck is something like a half-ton pickup.
If your vehicles belong to a fleet consisting of private passenger types, trucks, or a mix-up of these vehicles, they are usually given lower rates compared to the ones that do not belong to a fleet.
Do You have Vehicles in Your Company that You Do Not Own?
For vehicles that you do not own but used in your business, they are classified as:
- Hired Vehicles – These are the ones that you rent, lease, borrow, or hire.
- Non-Owned Vehicles – Besides the hired vehicles, these are the ones that you do not own but uses for your business.
If these vehicles are involved in accidents, your business could be facing a lawsuit even if you do not own them. It is recommended to buy commercial auto liability coverage even if you only use hired or non-owned vehicles. In fact, even if your company does not own any auto, you would need car coverage.
Where Do You Use the Vehicles and How They Are Being Used?
The rates of the vehicles in commercial auto insurance are determined by the distance traveled regularly and how long it stays on the road. It means, a vehicle that is being used as a delivery truck to send products to your customers has a higher rate than the vehicle that often stays on your workplace most of the time. The geographic location also influences the rates of the policy. This is because there are locations that have higher risks of thefts or accidents.
Certain businesses need to comply with special regulations if they use their vehicles across state lines. They must follow the requirements issued by the Department of Transportation. Similarly, if your business is transporting toxic chemicals, you must check with the both the federal and state laws.
If things get a little confusing, as your insurance agent to explain your policy further. At Sameday Insurance, we work hard in making sure that our clients are well-protected with policies that they can afford. To learn more about how we can help you, please contact our agency at (888) 750-9775 or Click Here to request a free quote.