For many small- to medium-sized business owners, a commercial auto insurance policy is generally not the first concern they have when trying to get their company up and running. Some entrepreneurs might assume that their standard, personal auto insurance will be enough should any accidents occur. However, that is a serious misunderstanding.
Whether you own a contracting firm or a company that depends on deliveries, using a company car is vastly different than making personal trips in a vehicle. Once an insurance company hears that an accident happened while you were making a delivery, it is very likely that they will decide to not cover you, as it was for a commercial use.
Shop around for the best price
The same way that you might find a better gas price just a little further down the road, it will also pay to shop around for the best commercial auto insurance policy. Especially considering that some companies recently adjusted their prices.
According to Larry Lapkin, an insurance broker at California-based Aegis Insurance Markets, his organization has been helping clients find new policies after sudden, unexpected changes in coverage costs.
Lapkin explained that one of Aegis' clients, a building contractor and developer in Truckee, California, needed two trucks and an SUV covered. He had been using a particular insurance agency for almost three years, but after scoping out various prices, Aegis helped him save almost 19 percent per year by switching providers.
Another situation that sometimes occurs is that an insurance provider will stop writing policies for commercial coverage. No business owner wants to be caught off guard, and understanding what you need will help guarantee that you can find it at an affordable price.
An important difference to note
Understanding the difference between personal and commercial auto insurance policies is something that every business owner needs to know, Lapkin said. Numerous scenarios call for coverage that a standard, personal policy will not handle. These include, but are not limited to:
- An employee uses titled vehicles in their work
- You have to make deliveries
- Your business depends on your workers making house calls
- You need to transport material from one location to the next.
Working with commercial insurance specialists will ensure that as a business owner, you do not receive the wrong information. An uninformed agent might tell you that your personal auto insurance is enough, but the truth is, it probably isn't.
The best coverage, every time
Cost-effective commercial auto insurance policies can be found, it is just a matter of working with the right business to help you get it.
"The last thing you will want to do is argue with your insurer over whether your automobile was used more for personal use or business use," Lapkin said. "If you use any titled vehicles in your business, then you need a commercial auto policy. The risk of a serious auto accident wiping out a small business far exceeds the premiums paid for the coverage and this is not the place to save premiums."
Whether you need one car covered or four, a comprehensive commercial auto insurance policy is essential to the long-term success of your business.