Commercial Auto Insurance

What Is Commercial Auto Insurance?

As a business owner, you need some of the same insurance coverage’s for the cars, trucks, vans or other vehicles you use in your business as you do for vehicles used for personal travel.

Commercial Auto Insurance is not covered under a business owner package policy. You will to purchase a separate policy. (hired and no-owned coverage can be added to a business owner policy) The Business Auto Policy (BAP) is the most commonly used contract for providing business auto liability insurance. Each vehicle you use in your business can be separately “scheduled,” or listed on your policy along with corresponding coverage. 

What Vehicles Are Covered?

The coverage in the business auto policy can be either broad or narrow, depending on your choice of options. In general, you have three options for which vehicles you choose to cover.
Autos your business owns
All autos your business owns, hires or leases
All autos used for the business, including those that your business does not own, hire or lease

Most businesses should buy the third type, since that is the only coverage that protects the business from liability when an employee or owner is driving a personal vehicle on business.

Unlike personal auto policies that have separate limits for bodily injury and property damage liability (split limits), the commercial auto policy has a Combined Single Limit (CSL). This creates higher limits for both bodily injury and property damage coverage’s, including per occurrence limits. Although you can purchase other limits, the most common commercial automobile csls for a small business are $500,000 and $1,000,000.