Do I Need Commercial Auto Insurance?

May 17, 2024 | Insurance 101, Commercial Auto

This article was originally published March 29, 2022

If you own a small business where vehicles are used to make deliveries, travel to meetings or work sites, run errands, etc., you’ve probably wondered, “Do I need commercial auto insurance?” It’s an important question to ask, since even minor accidents can produce major financial burdens if they aren’t covered by insurance.

However, it’s important to be aware that there are different methods for insuring the vehicles used by your business, and the key is who owns them. Commercial auto insurance covers business-owned vehicles. Other vehicles used by your business—like when an employee uses their own car to make deliveries—can, and should, be covered by what’s called hired and non-owned auto liability coverage. It’s purchased as an add-on to a business owners policy (BOP) or general liability policy.

What Kinds of Businesses Need Small Business Car Insurance?

If you’re asking yourself, “When do I need commercial auto insurance as a business owner” you should know that commercial auto insurance (sometimes called small business car insurance) is important for a variety of businesses and professions, including:

  • Architects and engineers
  • Bakeries
  • Business management consultants
  • Cleaning and janitorial companies
  • Contractors
  • Corporate trainers
  • Dog walkers and pet sitters
  • Electricians
  • Food service companies
  • Home inspectors
  • IT consultants
  • Landlords
  • Lanscape companies
  • Personal trainers
  • Photographers and videographers

Not every business in a particular industry needs coverage. For example, if you own an accounting firm that doesn’t have any company vehicles and your accountants never travel to meet with clients or for any work purposes, you probably don’t need commercial auto insurance or hired and non-owned auto liability coverage.

Of course, if you have any questions, it’s best to talk about your small business car insurance needs with one of our licensed insurance experts.

What Kinds of Vehicles can be Covered by Commercial Auto Insurance?

Commercial auto insurance can cover many types of vehicles, including:

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    Pickup trucks
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    Food trucks
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    Truck tractors
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    Emergency vehicles
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    Delivery/cargo vans
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    Tow trucks
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    Passenger vans
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    Box trucks
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    Flatbed trucks
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    Dump trucks
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    Dry van trailers
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    Refrigerated trailers
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    And many more…

If your business requires commercial auto insurance for a type of vehicle not on the list, our licensed car insurance experts can tell you whether or not we can offer a commercial auto insurance policy to cover it. 

What Does Small Business Car Insurance Cover?

Car insurance for small business owners from biBERK provides:

  • Bodily injury liability coverage. This provides payment in cases of bodily injury or death resulting from an accident for which you or your employee are at fault. This may also include legal defense expenses depending on the type of policy purchased.
  • Property damage liability coverage. If your vehicle accidentally causes damage to another person’s vehicle or property, this coverage can protect you. That includes legal defense expenses depending on the type of policy purchased.
  • Medical payments, no-fault, or personal injury coverage. This aspect of a policy provides payment for medical expenses that arise due to an injury to an employee or a passenger traveling in your vehicle, regardless of who is at fault in an accident.
  • Uninsured motorist coverage. This provides payment for any medical expenses, or in some cases property damage, caused by a hit-and-run driver or an uninsured driver. Underinsured motorist coverage (when the at-fault driver has insurance but not sufficient insurance to cover the damage caused) may also be included depending on the type of policy.
  • Comprehensive physical damage coverage. This provides payment for damage to vehicles or trailers on your policy caused by something other than a car accident—including theft, vandalism, flood, fire, and other specified hazards.
  • Collision coverage. This is coverage for vehicles or trailers on your policy for damage caused to them by a collision with another vehicle or by a single-car accident.

Commercial Auto Insurance Quotes Help You Determine Your Cost

Is commercial insurance expensive? Not if you get coverage from biBERK. Insurance for your vehicles is very affordable, especially when you consider the huge financial burdens it can protect you from. Getting fast, free, self-service, online commercial auto insurance quotes for your vehicles tells you what you’ll pay for coverage.

Commercial Auto Insurance FAQs

Still wondering, “Do I need commercial auto insurance?” Our licensed insurance experts are always happy to talk with you. But answers to some frequently asked commercial auto insurance questions are below for your convenience.  

How much does commercial auto insurance cost on average?

The cost of commercial auto insurance varies based on things like the type of vehicle, how it’s used, and the driving records of the people who will operate it, to name just a few. For example, commuter/consultant use of smaller vehicles can cost $600 to $1,500 per vehicle per year. The cost to insure vehicles for for-hire trucking can be $5,000 to $15,000 per vehicle per year. Livery vehicles may cost $2,000 to $6,000 per vehicle per year to insure. 

For damage caused in at-fault accidents, which drivers are covered by my commercial auto insurance?

Your policy can cover your employees, family members, and others who have permission to drive your vehicles. People who do so on a regular basis should be noted on your policy.

Will my insurance cost increase if I’m involved in an accident in my covered vehicle?

Your current policy won't be affected, but your next term or renewal may be. Your policy is rewritten each time it expires. When that occurs, your driving record is a factor in determining your rate. That means your rate may go up, but an increase is not guaranteed just because of an accident.

Does my commercial vehicle insurance cover items stolen from my vehicle?

Your policy can cover the vehicle and anything permanently attached to it, like a truck bed tool box. However, in that example, the tools themselves are not covered. Contractors who transport tools can purchase coverage for them under a general liability policy or business owners policy (BOP). Businesses in the for-hire trucking industry can purchase cargo liability add-on coverage to insure the goods they haul. 

If I’m pulling a trailer with a vehicle that’s covered under my commercial auto insurance policy, is the trailer automatically covered?

That depends on the size of the trailer. Liability coverage is automatic for trailers under 2,000 pounds gross vehicle weight, but for theft or damage coverage, you have to add the trailer to your policy. Trailers 2,000 pounds or over must be added to your policy to have coverage. 

Who Offers the Best Commercial Auto Insurance?

Insurance industry experience, financial resources, and positive customer reviews are three of the key factors to consider when trying to determine who has the best commercial auto insurance. biBERK is part of Warren Buffett's Berkshire Hathaway Insurance Group with millions of satisfied customers, a 4.9 out of 5 customer review rating, more than 75 years of insurance experience, and $38 billion in paid claims in 2020.

Of course, what you pay for your commercial auto insurance is important, too. Because we sell directly to you, and middlemen and brokers aren’t involved in the transaction, we can provide insurance for up to 20% less than other insurance companies. 

Finally, convenience is crucial for busy business owners. You can get a fast, free insurance quote on our website anytime. It takes just minutes, and so does buying or managing policies and reporting claims online. In short, biBERK makes purchasing commercial auto insurance easy and gives you the reassurance that a reliable company has your back should the unexpected happen.