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Top Industries In Need of Commercial Auto Coverage

Topics: Commercial Auto

According to a recent study by MarketStance, growth in small and middle commercial market risks caused an increase in the commercial insurance market in 2016. Among those industries named were specialty trade contractors, building construction, real estate, and new and used car dealers—all of which, in addition to property and casualty coverage, likely also need commercial auto coverage.

Commercial vs. Personal Auto Coverage

While it may seem like the two are indistinguishable, commercial auto coverage and personal auto coverage are actually like apples and oranges. Personal automotive insurance coverage applies to people only using their vehicles for personal business, like going to the grocery store or driving their regular work commute.

On the other hand, commercial auto coverage is designed specifically for business owners and business employees. Here are a few FAQs on Commercial Auto Coverage:

What’s the Difference Between Personal & Commercial Auto Coverage?

Commercial auto coverage is designed to take care of individual vehicles or entire fleets of vehicles and can cover all kinds of vehicles including trucks, vehicles with work equipment, vans, livery vehicles, flatbed or box trucks, rented or leased vehicles, as well as any vehicle that is owned or leased by a business.

Personal automotive insurance usually covers damage of vehicles and property and medical care for affected parties in the event of an injury. But commercial coverage takes that a step further.

In addition to covering medical care for an injured driver, the policy can also cover other employees in the vehicle. It can also cover equipment, as well as goods that are being loaded or unloaded. In addition, commercial auto insurance can protect your business in the event of a lawsuit.

Commercial auto coverage is designed to take care of individual vehicles or entire fleets of vehicles and can cover all kinds of vehicles including trucks, vehicles with work equipment, vans, livery vehicles, flatbed or box trucks, rented or leased vehicles, as well as any vehicle that is owned or leased by a business.

Top 3 Industries in Need of Commercial Auto Coverage

If you or your employees are using vehicles for professional business, then you do need commercial auto coverage. This policy can be added to your property and casualty insurance policy from your commercial insurance company. Here are a few types of businesses that will want to consider commercial automotive coverage for protecting the business and employees.

Specialty Trade Contractors

One of the most commonly underinsured industries for commercial auto insurance is that of specialty trade contractors. Usually super small businesses with just 1 or 2 employees, these contractors often don’t see the need to invest in a commercial auto policy. But if you couldn’t continue to run your business without your equipment, or you would be in financial ruin without your vehicle, then a commercial auto insurance policy should be part of your business model.

Plumbers, electricians, roofers, and other specialty trade contractors usually work from a truck or van that holds all of the important equipment. Whether it’s a water pump, a mobile welding unit, or simply a storage facility on wheels, it’s necessary for business continuity. In the event of a collision, commercial auto insurance could ensure that both the people involved and the equipment involved are financially covered. This helps small business owners who run specialty contactor businesses mitigate the cost of an expensive accident and ensure that the business is financially protected in the event of litigation.

Building Construction

Whether acting as a contractor on a build site, or bringing in a specially designed protection locker for industrial equipment, specialty trade contractors need to be protected when on the move. Automotive accidents are just that, accidents. And while employees may not intend to get in an accident, business owners can intend to protect their assets with a commercial automotive insurance policy.

Commercial automotive insurance protects employees who may have been injured in an automotive collision, as well as other parties involved. This specific type of policy also helps ensure that the business is protected against litigation. And finally, commercial auto insurance ensures that company assets, including vehicles, equipment, and product onboard, are all protected in the event of a collision or other automotive accident.

Real Estate

Real estate agents may not see the value, at first, in commercial auto insurance. One of the best things about being a real estate agent or broker is that you don’t have to stick to a set of hours. But that doesn’t mean that these workers shouldn’t be protected in the event of an automotive collision. Going to and from job sites in a personal vehicle with personal auto insurance means that the driver, passengers, and others involved in the incident will get necessary medical attention. The vehicles will also be repaired per the specifications of the policy.

But most real estate agents really work for themselves, not for a business. Like contractors, agents are paid “per gig” or “per sale.” That means that in the event of a serious collision, an injured party could sue the agent both personally and through their agent business. Commercial auto insurance helps ensure that the work-related incident isn’t paid through the personal insurance policy, and that the business is protected against such litigation.

How to Determine Whether You Need Commercial Auto Insurance

Commercial auto insurance helps ensure that the work-related incident isn’t paid through the personal insurance policy, and that the business is protected against such litigation.

If you’re not sure whether or not a small business needs commercial auto insurance, there are two simple questions you can ask:

  • Am I using the vehicle for business purposes?
  • Could the business be held liable in the event of a collision?

If you answered “yes” to either of these questions, then the business definitely needs to invest in commercial auto insurance to protect the business, equipment, and all involved persons.

Keep Reading to Learn More

Want to learn more about protecting your business? Check out the article, “Tips to Avoid the Five Most Common Workplace Injuries” on the AmTrust blog.

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