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What is Commercial Car Insurance?

Commercial delivery truck

Commercial car insurance is a type of auto insurance that protects vehicles used for business purposes. Commercial auto insurance policies typically include coverage for liability, property damage, and medical payments. Generally speaking, anyone who owns or operates a commercial vehicle can get commercial car insurance.     

This post will address the following questions:    

  • What is commercial car insurance?   
  • Who needs commercial car insurance?  
  • What is included in commercial auto insurance?   
  • What is NOT included in commercial auto insurance?    

What is commercial car insurance?

Commercial car insurance specifically protects vehicles that are used for business purposes and can cover any type of vehicle including cars, trucks, and vans. Commercial auto insurance policies typically include coverage for liability, collision, and physical damages.

Who needs commercial car insurance?

Anyone who uses their vehicle as part of their occupation may want commercial car insurance because it will provide added coverage against accidents or other incidents which might damage the vehicle. Commercial car insurance policies may also cover vehicles that are used for personal use in certain circumstances, including when transporting employees or goods for a business purpose.   
The type of policy you need will depend on the nature and usage of your vehicle, so it’s important to speak with an insurance agent if you’re not sure what type of policy is needed for you.   
It’s important to note that private passenger vehicle owners and drivers do not need a commercial auto insurance policy because their personal policies will cover them in the event of an accident.

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What's included in commercial auto insurance?  

Commercial car accidents are handled in the same way as other types of accidents, but there is an added liability for your business if your commercial vehicle is not properly insured. To minimize your liability, you need to choose the right level of coverage for your commercial vehicle so that your costs are covered in event of an accident. Some of these include:  

Liability coverage– including bodily injury liability and property damage liability coverage for accidents caused by the driver of your vehicle   
Collision coverage– after an accident, collision coverage helps pay to replace or fix your vehicle   
Comprehensive coverage– this helps pay for your business vehicle repairs if the car is damaged from something other than a collision (such as theft, fire, vandalism, or hail) 
Uninsured/underinsured motorist coverage– this helps pay for your employee’s medical bills or car repairs if they are in an accident that is caused by another driver who does not have enough liability insurance to cover the expenses 
Rental car coverage– this helps pay for the cost of renting a car that you can use for your business while your vehicle is getting fixed or replaced 

What's not covered by commercial car insurance? 

While coverage may vary depending on where a person lives, these items are generally not included in coverage:

  • Medical expenses that are unrelated to your accident
  • Repairs to your rental vehicle while your car is getting fixed
  • The items inside the car, including damaged products and inventory
  • Accidents that occur when an employee drives their personal vehicle for business purposes 

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