It started out as a hobby because you love baking cakes and pastries. You became good at it and your friends and families love your concoctions. Before you knew it, you have an assistant delivering cakes and pastries to customers using the family van. If that assistant happens to figure in a vehicular accident, you will be surprised that the personal car insurance policy of your van will not cover that accident because the van was used in a business.
You will learn the hard way unfortunately, that when a personal vehicle is used for business purposes, it needs its own commercial vehicle insurance.
If you’re wondering what is considered “commercial vehicle”, here’s a simple explanation. A commercial vehicle is a vehicle used for business purposes, for transporting materials, goods, tools or equipment that are related to your occupation or business. You will need commercial auto insurance if you own a vehicle used for deliveries, for transporting employees, goods and equipments for your catering business, for landscaping or plowing services, for farm-to-market-delivery, and other similar uses. You will definitely need commercial auto insurance if you own heavy vehicles like trucks and trailers used for your business, like logging and hauling heavy equipments and materials.
The types of coverage of a commercial vehicle insurance policy, in most ways, are similar to that of a personal car insurance policy, although there are some very notable differences. The standard coverage may include coverage for injuries or damage that you cause, your driver’s injuries, injuries and damages caused by uninsured or underinsured drivers, and damage to or theft of your vehicle. Depending on your State, your commercial car insurance may be required to carry higher liability compared to personal car insurance. With a commercial car insurance policy, you can list the names of the drivers of your commercial vehicle so they are covered if in case they figure in an accident.
As with your personal car insurance, there are ways to lower the premium on your commercial auto insurance. You probably know that the driving records affects the rate of any auto insurance, the same applies to commercial ones. As much as possible, you should hire only employees that have good driving records. It will also help a lot, although not required, if they’re carrying commercial driver’s license. Do not let your car insurance policy lapse, as you’ll get higher rate on your for the premium if you let your prior insurance policy lapse. Also, there are many insurance companies today that will consider your credit rating.
To have a lower insurance premium, shop around and compare commercial auto insurance quotes. There are many insurance companies offering different deals. Make sure that what you’ll get matches the type and size of your business. Check out the insurance company’s profile too, if they have a good record when it comes to claims. As much as possible, go to independent insurance agents that can give you many options of insurance companies to choose from. There are many such agents on the internet with their own websites offering free and instant quotation on car coverage.
By Lauren Mathews