Some firms may have only one or two vehicles they use for business while others have a fleet of vehicles and trucks to transport job-related materials, goods or equipment. Even if you don’t own any commercial vehicles, your employees may use their personal cars to run business errands, go on sales calls, attend conferences and other company-related events in your community or throughout the state of Texas. Whatever the case may be, Commercial Auto insurance is must-have coverage to protect your business in the event of an accident involving a vehicle used for business purposes.

When a Commercial Auto Insurance Policy Is Needed

Let’s look at some of the issues that may come up to help you understand the need for a Commercial Auto policy.

  1. Is the vehicle titled in a business name or an individual? If your vehicle is titled and owned by a business you’ll need some form of Commercial Auto insurance. If personal automobiles are used for business purposes, it is wise to have Non-Owned Auto coverage as part of your Commercial Auto policy. That’s because there are Personal Auto policies that exclude business use. So, a coverage gap may exist if the business coverage is not extended to handle non-owned vehicles. What’s more, there may not be enough Liability coverage under the employee’s Personal Auto policy and the claimant will look to the business owner’s Auto policy, which typically includes higher limits.
  2. The type of the vehicle. The vehicle’s weight and size will determine if you need commercial insurance. Obviously if you have an 18-wheeler you will need a Commercial Auto policy but what about a sub-compact car? In a case like this, again, it depends on how that car is being used. If it’s for business-related activities, you should cover the vehicle under you Commercial Auto insurance.
  3. Required by contract or regulation? Many business contracts specify vehicle coverage type and the amount of liability limits. The coverage and required limits may only be available in a Commercial Auto policy. State and federal transportation agencies have specific insurance requirements for certain classes of business and/or vehicles.

What’s Included in Commercial Auto Insurance

  • Liability coverage for bodily injury (BI) and property damage (PD)
  • Medical coverage for injuries to you, your employed drivers or passengers for medical expenses and, depending on the plan, could include lost wages, the cost of hospitalization, treatment and funeral expenses
  • Collision coverage for costs associated with an accident, regardless of who is at fault
  • Comprehensive coverage for damage other than collision, such as theft, fire, and vandalism to a vehicle
  • Uninsured and Underinsured Motorists coverage in the event of an accident with an at-fault driver who has no or limited liability insurance to cover injuries
  • Non-Owned & Hired Auto coverage for when you or your employees drive a rented or borrowed vehicle, or an employee uses his/her car for business purposes
  • Substitution Transportation when your commercial vehicle is being repaired and you use a loaner from the repair shop
  • Towing and Labor costs

Make Preferred Your Insurance Choice

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