How Much Is Commercial Vehicle Insurance

In contrast to personal autos, vehicles classified as “commercial vehicles” and used for business purposes are covered by commercial vehicle insurance. Vehicles used for business purposes, such as the transportation of passengers or delivery of goods, require commercial vehicle insurance. If you want an answer to the question “how much is commercial vehicle insurance?” Read along to get answers and learn more about commercial auto insurance!

What is commercial vehicle insurance?

Commercial auto insurance is a type of insurance that pays for accident-related vehicle damage. It is a sort of all-inclusive insurance that protects against harm from causes other than fire, theft, and vandalism. Different insurance companies sell commercial vehicle insurance, which is usable for both personal and business automobiles. Commercial vehicle insurance is needed for commercial vehicles such as trucks, tractors, cabs, taxis, and pickup trucks, among others.

Why is commercial auto insurance important?

Commercial vehicle insurance is crucial for protecting a firm from any unfavorable circumstances that could result in a significant financial drain. Comprehensive commercial vehicle insurance provides coverage for almost all types of vehicles used for business. Some of them include taxis, tractors, cranes, mobile rigs, bulldozers, and vehicles that carry passengers.

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Types of commercial vehicle coverages

  1. Auto liability coverage

Liability coverage refers to the legal requirement to make a monetary payment for property damage or bodily harm. Auto Liability insurance covers legal costs associated with accidents, such as attorney fees or settlement costs. This insurance protects you from legal liability brought on by owning, using, or operating an insured motor.

2. Medical payment coverage

Medical expenses are covered under medical payment coverage if you or your passengers were hurt irrespective of whose fault it was. The reasonable expenses must be related to the bodily injury caused by an accident depending on how the phrases are defined in the appropriate coverage form.

3. Comprehensive and collision coverages

Comprehensive coverage shields you against damage caused by occurrences other than collisions. If your car is damaged by something other than a car accident, it pays for the repairs. Collision coverage is the portion of your physical damage insurance coverage that guards you against monetary losses. For instance, if your car sustains damage in a collision with another car, object, or car overturn.

4. Uninsured motorist coverage

Commercial vehicle policy also includes uninsured motorist coverage.  This safeguards you, your passengers, and your vehicle in the case of harm or damage when the at-fault driver lacks auto insurance.

How much is commercial vehicle insurance?

There is no definite answer to this question. Why? This is because there are various factors that determine the cost of commercial car insurance. Let’s dig into them!

  1. Type of coverage

The cost of various types of auto insurance varies. The lesser a policy’s coverage, the less coverage it provides. A standard commercial auto policy is often required for automobiles operated by businesses. It functions much like a personal auto insurance policy in that it protects both property damage and liability lawsuits. Due to the higher cost of claims, commercial auto insurance typically costs more than personal auto insurance.

2. Where & how much you drive

Your policy’s premium also varies depending on where your company automobile is kept overnight and during business hours. For instance, you can incur increased insurance costs if you frequently leave your car parked in high-crime or accident-prone regions. In contrast, you can be eligible for lower premiums if you park in a secured lot that discourages theft.If your company does business in an area that frequently suffers severe windstorms and heavy traffic, these factors may raise the likelihood of crashes and vehicle damage, both of which would raise the price of company auto insurance.

3. Demographics

Providers can evaluate hazards depending on the driver’s demographics as well. Thus, the carrier will require information such as age, sex, and marital status.

4. Type of driving

How the car will be used is another factor for commercial auto insurance rates. Your service provider might inquire if you use the car for things like:

  • Transporting workers and tools
  • Delivering food or packages
  • Carrying dangerous goods

Transporting hazardous items entails higher liability risks and compliance concerns, which might increase the cost of your premium.

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Other factors include;

  1. Type of vehicle

The vehicle chosen to represent your company may also affect premium costs. You might wish to research insurance costs before deciding whether to buy, lease, or rent a car. In addition to having to adhere to state and federal insurance rules, trucking companies can anticipate paying extra for the insurance of their trucks.

2. Safety devices

Selecting a car with the following features could lower your auto insurance rates:

  • Anti-lock brakes
  • Automatic seat belts
  • Daytime running lights
  • Side airbags
  • GPS trackers and other anti-theft devices

Even while these characteristics might appear insignificant, they lessen the severity or likelihood of accidents and thefts.

3. Driving records

Anyone who drives for your company should have a fairly clean driving history. Higher premiums may result from a history of claims, crashes, and driving tickets. Now that you can answer the question “How much is commercial vehicle insurance? let’s move to another popularly asked question;

Are trailers covered by commercial vehicle insurance?

Commercial motor insurance policies covered trailers that are being pulled by the insured vehicle. A commercial vehicle insurance policy has several coverage options. If your trailer is found to have contributed to an accident, liability protection safeguards your finances. It also covers injuries sustained while someone was traveling in the trailer with you. A trailer is a vehicle that is pulled by another vehicle and can be used to transport both passengers and cargo. Trailer covers differ from other types of coverages since they are not affixed to the vehicle. The driver’s auto insurance does not cover the trailer; it is usually protected by a separate policy.

Commercial auto insurance is a must for all businesses including small enterprises. Whether you run a food truck or a lawn care company, you are aware that there are some risks associated with driving to various locations or job sites that cannot be avoided. Automobile collisions can result in exorbitant legal fees in addition to being deadly. Which is why you should get your commercial vehicle insured today!

About the author

Zainab Olatunji

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