Coverage and Limits of Commercial Property Insurance

Different types of businesses crop up across the country every year, with almost 99 percent of them using auto transport to fulfill their business needs. Therefore, commercial auto insurance has become very important to help businesses protect their vehicles and any other risks associated with using them. This is so as cars used for business purposes require special coverage other than individual auto insurance, which is what commercial vehicle insurance offers.

Commercial vs. personal auto insurance is a common topic, particularly amongst small business owners. However, cars used for business activities cannot come under the coverage of personal auto insurance. The insurance policy needed in this instance is commercial auto insurance for business. If you haul a commercial trailer using a private auto, it is best to get a commercial business policy. However, if you intend towing something that is not for your company, calling for hire or non-owned auto coverage is advised. It is worth noting that these conditions are different from one state to another. Therefore, it is advised that you consult the insurance department of your state for better clarification.

Commercial auto insurance is similar to auto insurance policy as both policies offer similar coverage. The policy offers fixed and optional commercial auto insurance coverage. Some of the coverage businesses get to enjoy when they buy commercial auto insurance is briefly highlighted below.

Accident profits coverage


This coverage is offered by virtually all insurance companies as it is one of the basic coverage of an average commercial auto insurance policy. The coverage basically reimburses the injured person. Funeral costs, medical and therapy treatments, loss of earnings due to death and disability are the very common reimbursements under this coverage.

Intermediary Liability coverage


Here, the policy offers coverage if an injury is caused by someone other than the driver, while the business car is being driven. It also covers damages to another business or individual’s property while driving. The driver is arrested in most cases until the insurance pays for damages or the medical expenses as the case may be.

If the driver of the vehicle is arrested for issues beyond the coverage, the company becomes responsible for such damages or claims.

Uninsured, Underinsured and Unidentified Motorist coverage


This is usually described as the most widespread type of coverage. The name of the coverage usually differs from one state to another. However, the principles that guide the coverage are the same everywhere. The aim of the coverage is to provide compensation if the driver of a commercial vehicle is wounded or even killed due to the fault of an underinsured or uninsured driver.

The coverage also provides compensation for damages caused by an unidentified motorist.


Direct Reimbursement – Property Damage


This type of coverage is designed for the provision of reimbursement for damages to the business’ vehicle and any other possessions in the vehicle. However, the coverage can only take effect if the accident was not caused due to the negligence of the driver of the policyholder.

Family Protection coverage


The family protection coverage as the name connotes is designed to offer a somewhat comprehensive coverage. Here, coverage is offered to the driver of a guilty, underinsured or uninsured driver of the vehicle. In some instances, the family protection also guarantees coverage up to the commercial vehicle insurance policy’s limits, except the other party’s coverage points.

In addition to the coverage mentioned above, below is a list of typical coverage available to businesses

  • Property damage liability
  • Liability for bodily injuries to third parties
  • Optional bodily injury coverage for injuries that happen outside the business’ state of residence
  • Loading and unloading liability
  • Towing and labor costs
  • Substitution transportation when the business vehicle is unavailable and a loaner from the repair shop is used
  • Non-owned auto coverage for when a rented or borrowed vehicle is used

Some businesses fail to purchase commercial auto insurance due to the relatively high cost associated with purchasing one. However, there are inexpensive commercial auto insurance policies available to businesses if the right steps are taken. It is usually advised that businesses seek different insurance quotes and packages, compare them, and subsequently select the best commercial auto insurance for their circumstance.