What Is Commercial Auto Insurance? Commercial Auto Insurance is a specialized type of insurance designed to protect business-owned vehicles and their drivers when accidents, theft, or other damage occur while on the job. It’s like car insurance for your business fleet — whether that’s a food truck, delivery van, or a fleet of service vehicles — but not for your personal ride.
What Does It Cover?
| Coverage Type | What It Does | Example |
| Liability Coverage | Pays for damage or injuries you cause to others | Your driver hits another car |
| Collision Coverage | Repairs your vehicle after a crash, even if it’s your fault | Company van hits a pole |
| Comprehensive Coverage | Covers non-crash events like theft, fire, hail, or vandalism | Company car is stolen overnight |
| Medical Payments / Personal Injury | Covers medical bills for your driver and passengers | Employee injured in a wreck |
| Uninsured Motorist Coverage | Protects you if the other driver has no insurance | You’re hit by an uninsured driver |
What It Doesn’t Cover
- Personal vehicle use (get personal auto insurance for that)
- Employees using their own cars for work (get Hired & Non-Owned Auto Insurance)
- Cargo (get separate inland marine or cargo insurance)
Who Needs It? You likely need Commercial Auto Insurance if:
- You own or lease vehicles in your business’s name
- Employees drive company vehicles
- You transport goods, tools, or people for work
- You operate food trucks, delivery vans, or service vehicles
Real-Life Example Imagine you run a landscaping business and send an employee in the company truck to a job site. On the way, they rear-end another car. Here’s what Commercial Auto Insurance would cover:
- The other car’s repair
- Their medical bills
- Your truck’s damage
- Legal costs if there’s a lawsuit
How Much Does It Cost? The cost of Commercial Auto Insurance depends on several factors, including:
- Type and number of vehicles
- What you use them for
- Driving history of employees
- Coverage limits and deductibles
On average, small businesses pay between $1,200 and $2,500 per vehicle per year, though rates can vary widely based on your specific needs.
Bottom Line: Commercial Auto Insurance is essential if your business involves vehicles. It protects your drivers, vehicles, and company from severe financial loss after an accident, theft, or other covered event.
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