Whether you’re an electrician driving from site to site or a florist delivering beautiful bouquets — if you own a small business that requires the use of a vehicle, you’ll need commercial auto insurance. Many small business owners think they’re protected under their personal policy, but it’s important to understand the differences between the two types of coverage so you’re not leaving yourself vulnerable to risk.
Small Businesses that may require commercial auto insurance:
- Catering services
- Contractors traveling between jobsites
- Limousine services
- Taxi services
What’s covered by commercial auto insurance? Some of the common, standard coverage options include:
- Third Party Liability Increased liability limits available
- Collision/Comprehensive Deductible Various options available to reduce your deductible Excess Value Increase class A, C, D and TS plate value limits (at lower rates than on the plate)
- Road Hazard Glass Provide coverage against cracks and chips
- Replacement Cost Available on new, commercially plated Light Vehicles
- Loss of Use Coverage Rental Reimbursement coverage if your vehicle is involved in a claim Wildlife Waiver $0 Deductible option available for damage caused by wildlife
- Damage to Unlicensed Vehicles Coverage available for unlicensed & in-storage vehicles Non-Owned Auto Coverage available for vehicles &/or trailers you use but do not own Unlicensed & In Storage Coverage – Provides coverage for units not in use/not plated
If you’re unsure whether or not your small business needs commercial auto insurance, here are a few questions you could ask yourself that may help clarify.
Who owns the vehicle? This refers to whether the vehicle’s ownership is in your name, or your business’ name. If it’s registered to your business, and is used primarily for business needs on a daily basis, it should have a commercial auto insurance policy protecting it. If you’re a sole proprietor running a small business out of your home, and you don’t regularly make deliveries or travel from jobsite to jobsite—your personal auto insurance coverage is probably enough for now.
How is the vehicle used on a daily basis? This will be a key indicator in deciding what type of auto insurance coverage is right for you. If your vehicle is used for any of the following reasons on an on-going basis, you should consider commercial auto insurance coverage:
- You transport or deliver goods, materials or merchandise o You transport equipment or tools (contractor)
- Your vehicle is used for driver training
- You transport customers for any reason (for example, you operate a limousine service or taxi service)
For more information or to receive a quote contact us or stop into any Farrell Agencies office. We would love to see you!