Do You Need a Commercial Auto Policy?

Written by on 1/19/2016 6:01 AM . It has 3 Comments.

driver with car keys

It can be hard to know what insurance you need for your business, and when you need it. Maybe you’re branching out on your own, working for yourself. You could be growing your small business and adding employees and equipment. Knowing when to add new insurance coverage can be tough.

The only thing that separates you and your business from continued growth or devastating loss is one bad car accident. Here are some ways to tell if you need a commercial auto policy for your business to protect you, your business, and your employees.

Signs You May Need to Buy Commercial Auto Insurance

  • Your vehicle is used to pick up or deliver goods like food, supplies, materials, messages, and packages.
  • Your vehicle is used as a limo, taxi, or livery service. Uber and Lyft drivers, this means you, too.
  • You have vehicles owned or leased by a business partnership or corporation.
  • You have vehicles registered or titled to a business, corporation, partnership, or DBA.
  • You have employees or non-listed drivers that use your company vehicles.
  • You rent or lease vehicles to other people or businesses.
  • Your company owns trucks, vans, or utility vehicles heavier than 10,000 pounds (gross) or they have the capacity to carry a load exceeding 2,000 pounds.
  • Your vehicles include snowplows, catering or racing equipment, altered suspensions, or hydraulic lifts.
  • You’ve added ladder racks or permanent toolboxes to your vehicles to be used for business.
  • Your employees use their personal vehicles for travel, to run errands for the business, or to attend meetings.
If your personal vehicle or vehicles used by your business fall into any one of these categories, you may need a commercial auto insurance policy.

What Do Commercial Auto Insurance Policies Cover?

You may wonder why you can’t rely on personal auto insurance or even a general business insurance policy. Standard business insurance policies don’t include vehicles at all while personal auto insurance is limited in its coverage.

Commercial policies have several different features:

  • Auto liability which protects your business in the event of an accident
  • Trailer interchange insurance covers you when your vehicles are hauling trailers you don’t own
  • Rental reimbursement with downtime helps recoup some of the lost revenue when a vehicle is down for repair
  • Non-owned auto liability provides coverage when your employees drive their own vehicles
If you try to rely on a personal auto insurance policy, you may be surprised. The policy may cover the cost of the individual’s claim in the accident, but only up to the policy limit. If the accident victim decides to sue your business, or if the claim is larger than the policy limits, you’ll have to pay the difference out of pocket. Most importantly, personal auto insurance will only kick in if the vehicle is only used occasionally for business. If the vehicle is used primarily for business, the claim may not be paid at all.

Don’t open yourself up to major losses and big lawsuits. Whether you use your personal vehicle or your company owns multiple vehicles, make sure you have the right coverage to protect you and your business.

When you’re ready to learn more about commercial auto insurance and the different options available, Charlotte Insurance is here to help. Contact us today!


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  1. Jerry's avatar Jerry
    I need commercial insurance for 4 vehicles, can you help?
    Reply 1/5/2017 8:20 AM
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