“Many small-business owners believe that if their car is in their personal name then commercial coverage is not necessary and their personal auto policy will cover the auto. This is not true,” states Gregory Boop, of Business Insurance About.com. “Most personal auto policies exclude from coverage the use of a vehicle for commercial purposes."
While personal auto Insurance policies and commercial auto policies offer the same type of coverage, it is important for business owners to take out the correct policy, as personal insurance doesn’t supply adequate insurance for vehicles that are used commercially.
“Your personal auto insurance policy provides coverage in case you are involved in an accident when you are driving,” explains Poole Insurance, an insurance agency based in Houston, Texas. “In the same way, commercial auto insurance provides coverage in the event of an accident while the vehicle is being driven for business related reasons."
A commercial auto policy is similar to a personal auto policy. It provides coverage to repair or replace a vehicle damaged in an accident. It also pays for the claims of a third-party who is injured in the accident.
While commercial auto insurance is not required in all circumstances, in most cases, this insurance is an important precaution for businesses to take. Purchasing commercial liability insurance can protect a business in the event of an accident.
“Even if your state does not require commercial auto insurance for your company vehicle, you may still want to consider taking out a policy,” explains Poole Insurance. “Many companies and commercial drivers decide to purchase additional liability insurance –even above the amount that is required by the state.”
So how much insurance coverage is enough? Experts recommend business owners who offer delivery or transportation services take out comprehensive policies –to ensure that their companies are protected in case of an accident. In many cases, the state required minimum for auto insurance is not enough to cover a serious accident.
“The amount of insurance that you should purchase varies depending on the amount of driving that your company does, and the nature of the business," Poole Insurance reminds business owners. This is why companies, who are in need of commercial auto insurance, should check with their insurance agents to make sure that their coverage is comprehensive.
For more information on commercial vehicle insurance, contact Poole Insurance Agency.
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