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Commercial Auto Insurance: Does It Fit?

Make sure your commercial auto insurance fits your small business considerations.

Most business owners know the risk involved with their product and service but often assume their personal auto coverage is sufficient.  Any vehicle owned or operated by the business may put the business at serious risk financially in the event of an accident caused by that vehicle or the operator and that includes employees using their personal cars for business purposes.

First, commercial auto insurance needs to be take out anytime a vehicle is titled to the business.  It doesn’t matter the size, make or even if it is used strictly for pleasure.  The business name on the title brings the business into a lawsuit in the event of an accident or personal injury.  Even if the car is used by the business owner’s spouse or family member exclusively, the titleholder — the business — can be sued. Obviously, the type of vehicle classification, motor size, uses, must all be noted and will impact both premium and coverage.

It may make sense to opt for fleet insurance for your business.  In addition, make sure to run driver’s license checks on your employees who may be driving the company vehicle.  Work with your insurance professional in determining the proper coverage and policy.

Taking just state minimums again may expose your business to financial risk in the event of a lawsuit or judgment higher than the state minimum.  Work with your agent and perhaps your corporate attorney to review the coverage and potential for risk.  Your state department of insurance can also be an invaluable resource.

You insurance professional will review other coverage’s available for commercial auto insurance.  Comprehensive coverage, under insured motorist, medical payments and others may be available.  Together, design a policy and coverage that provides adequate protection and minimizes the exposure for your small business.

Don’t assume you have good coverage without having a conversation and review with your commercial insurance agent.

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