Site icon AdvisorSmith

Commercial Auto Insurance for IT Professionals

Commercial Auto Insurance for IT Professionals

Get a quote on Commercial Auto Insurance

If your IT company owns or leases vehicles, or if your employees regularly use their own vehicles for work purposes, it’s crucial to consider Commercial Auto Insurance. Auto insurance is legally required in most states, and it can protect your company from the significant costs associated with vehicle collisions. If you or one of your employees is at fault in an accident that causes bodily injury or property damage, settlement costs could be high. Injuries can be severe and require costly, ongoing care, and vehicles are increasingly difficult to repair because of their growing mechanical complexity. It’s important to financially protect your company by purchasing sufficient Commercial Auto Insurance coverage.

What is Commercial Auto Insurance?

Commercial Auto Insurance protects your business against the financial consequences of auto accidents involving company vehicles. If you or your employees are at fault in an accident while driving a company car, Commercial Auto Insurance will pay for any resulting third-party bodily injury or property damage. Commercial Auto Insurance also covers your vehicles if they are physically damaged or lost due to theft, vandalism, collisions, or other perils.

Example:

Who needs Commercial Auto Insurance?

If your company owns or leases vehicles that are titled under the name of the business, you will likely need Commercial Auto Insurance, as most states require a minimum level of liability coverage for all vehicles. Owning and operating a motor vehicle opens your business up to significant liability, and the cost of dealing with lawsuits can be financially draining. For small businesses, in particular, the legal expenses and settlement costs involved in auto claims have the potential to put you out of business.

There are a variety of auto policies available that can cover a range of situations, from small businesses with only one vehicle to companies with large fleets. Commercial Auto Insurance covers many types of vehicles, including those that aren’t typically covered under personal policies, such as large trucks, but most IT companies are likely to only need coverage for cars, SUVs, or vans.

What does Commercial Auto Insurance cover?

Commercial Auto Insurance includes liability and property components. The liability component covers your company if it’s at fault in an accident that causes bodily injury or property damage, while the property component covers the value of the vehicle itself.

Commercial Auto Liability Coverage

The liability portion of Commercial Auto Insurance generally covers three types of damages caused by an accident in a covered vehicle: bodily injury, property damage, and pollution cleanup. Some insurance policies will have separate limits for bodily injury and property damage, while others have combined single limit (CSL) liability, which combines coverage with a single limit.

Bodily Injury Liability. If you or your employee is at fault in an accident while driving a covered vehicle, your bodily injury liability will cover injuries to your passengers, the occupants of other vehicles, or pedestrians. Covered expenses include medical bills, legal fees, lost income, pain and suffering, and funeral costs.

Property Damage Liability. Property damage liability covers you if you cause damage to others’ property while driving a covered vehicle. Covered property includes vehicles and other property, such as walls or fences.

Pollution Cleanup. If you or your employee is at fault in an accident that causes the covered vehicle to leak pollutants, your insurer will pay for cleanup costs. This coverage only applies in situations where property damage or bodily injury covered by the policy has occurred. It covers pollutants that are part of the vehicle’s normal operation, such as gasoline, motor oil, or coolant. Pollution cleanup coverage also applies in situations where pollutants are released due to a covered vehicle damaging, upsetting, or overturning a container holding the pollutants.

Commercial Auto Physical Damage Coverage

Commercial auto physical damage coverage protects the value of your vehicle if it is damaged or stolen. There are three forms of physical damage coverage: collision, comprehensive, and specified causes of loss.

Collision. Collision coverage will pay for damage to your vehicle if it is involved in a collision with another vehicle or object, or if your vehicle is overturned. Collisions can happen with other vehicles or stationary objects like trees, buildings, and more.

Comprehensive Coverage. Comprehensive coverage will pay for damage to your vehicle that is not caused by a collision, such as theft, vandalism, falling objects, fire, or flood.

Specified Causes of Loss Coverage. Specified causes of loss coverage is a more limited alternative to comprehensive coverage. Instead of covering a broad range of risks, it covers only specific risks named in the contract. Because it provides a smaller range of coverage, it is usually less expensive than comprehensive coverage. Covered causes of loss typically include:

Uninsured and Underinsured Motorist Coverage

Many states require you to have uninsured and underinsured motorist coverage. This coverage can be added as an endorsement to your Commercial Auto policy and protects your company if one of your employees is involved in an accident with an uninsured or underinsured motorist.

Uninsured motorist coverage protects you if your vehicle is involved in an accident caused by an uninsured driver. Because the other driver does not have insurance, they may not be able to pay for any injuries to the occupants of your vehicle resulting from the crash. In this situation, uninsured motorist coverage would step in to provide coverage.

Underinsured motorist coverage protects you if your employee is not at fault in a collision, but the resulting costs for medical expenses exceed the liability limit of the at-fault driver’s insurance. Many drivers purchase the minimum amount of insurance required by law in their state. If your employee suffers serious injuries, this may not be enough to cover their medical costs. Underinsured motorist coverage would step in to cover the difference.

What are the key exclusions to Commercial Auto Insurance?

Commercial Auto Insurance covers most instances of bodily injury or property damage, but there are a number of key exclusions.

Common exclusions to liability coverage include:

Excluded causes of loss for physical damage coverage include:

What is hired and non-owned auto insurance?

Hired and non-owned auto insurance protects your company if you or your employees are at fault in an accident while driving a vehicle that is used for business purposes but isn’t owned by your business. If your employees drive their personal vehicles for work purposes, such as visiting clients or running business errands, or rent cars while traveling for business, you may need this type of insurance. If your employee causes an accident while driving for business purposes and their personal insurance is not enough to cover the claim, your company could be held liable.

This type of insurance only covers third-party property damage and bodily injury. It does not cover the employee involved in the accident; workers’ compensation, medical payments coverage in personal auto insurance, or personal health insurance should cover injuries to the employee. Damage to the employee’s car would be covered by the employee’s personal auto policy.

Hired and non-owned auto insurance can be added as an endorsement to your Commercial Auto Insurance policy. If your company does not need Commercial Auto Insurance, you can purchase hired and non-owned coverage separately or add it as an endorsement on your general liability or business owner’s policy.

Example:

Pricing and Quotes

The premiums for a Commercial Auto Insurance policy vary widely and depend on a number of factors. While most small businesses will pay less than $2,500 per vehicle per year, there is a great deal of variance.

Factors that may influence your premium include:

In order to get an accurate estimate on pricing, it’s best to get a quote from a reputable commercial auto insurance company. Below we’ve highlighted a few of our trusted partners who offer Commercial Auto Insurance:

ProviderCommercial AutoHired & Non-Owned AutoUninsured & Underinsured Motorist
CoverageSmith??????
CoverWallet??????
Hiscox??????

Final Word

If your IT company owns or leases vehicles, Commercial Auto Insurance is an important consideration. Not only is it legally required in most states, but it can also protect your company from significant financial losses if your vehicle is involved in an accident or damaged by other perils. It’s also necessary to make sure you have the correct coverage for personal or rental vehicles that are used for work purposes. Hired and non-owned auto coverage can protect you in those cases. Commercial Auto Insurance can provide financial protection from costly lawsuits and settlements, and for any company that relies on vehicles for business purposes, it is a critical coverage to obtain.

Exit mobile version