Many businesses become overwhelmed with their everyday operations and neglect the importance of business auto insurance. Unfortunately, this can lead to devastation if an employee is ever in an accident with a company-owned vehicle. Many businesses make the mistake of thinking that typical personal auto insurance will cover their liabilities if an accident occurs. However, this is not the case. The business will be held liable for any damages or medical expenses as a result of an incident involving a company’s auto.
The differences between personal auto insurance and business auto insurance are rather intensive. Personal auto insurance will cover the theft, damage and any fees associated with an accident. Business auto insurance, however, must make the company whole again. Not only will this include all the coverages of personal insurance, but it will also be tailored to the needs of your business. If a company vehicle is damaged or stolen with merchandise on-board, the insurance will cover the costs of all the materials stolen or damaged. This ensures that the business can adequately operate without any interruptions in day-to-day activities.
When applying for auto insurance, many factors will be used to determine the appropriate price for the policy. The number of drivers, types of vehicles, and types of cargo that will be transported will play a big role in determining the policy’s rate. Also, the people who will be passengers in the vehicles will also factor into the cost. If the primary operations of a business include transporting numerous passengers, the policy will be drastically different than that of a business that sells merchandise. The amount of projected traveling may also be a factor and will need to be accounted for before a policy is agreed upon.
Before inquiring about business auto insurance, it is important to know that there are a few ways to reduce the cost of the policy. Seasonal businesses are often able to take out a policy just for their operating season. This allows them to save money in the off-season when they are not operational. Oftentimes, when drivers have their CDL license, they will be eligible for a significant discount on the policy. While this might not apply to all businesses, it is a vital discount for those that do qualify.
Also, if a business has been in operation for several years without any incidents, it may be eligible for further discounts.
While this may be a lengthier and more complicated form of insurance, it is essential for a business to obtain the appropriate coverage. Protecting business assets and providing coverage for any potential liabilities is an expense that is well worth the cost. Once a business meets the appropriate requirements, it will be able to proceed with its operations without worrying about their vehicles or drivers. The best part is that every policy is tailored to meet the needs of each and every business. If one business has only one driver, its costs will likely be based on that driver’s history. This allows companies to pay for the coverages they need at a price that is suitable for their operations.