Commercial auto insurance is designed for businesses. While that includes major corporations and large companies in Salt Lake City, Utah, it can also mean the one-man store and the mom-and-pop shop. Even independent contractors and those who are self-employed and work from home may need commercial insurance for their vehicles.
How Do You Know If You Need Commercial Insurance?
There are several scenarios which would require you to purchase business car insurance. For instance, if you have employees who must drive your vehicle for work purposes, you’ll probably need insurance for businesses.
Some other situations which would indicate the need for commercial vehicle insurance include the following:
- If you lease or rent out your vehicle to other people
- If your automobile is registered to a business
- If you use a vehicle as a taxi service or other livery
- If you drive your vehicle for delivery or pickup of goods or supplies
- If you have equipment installed on your vehicle which is used for business
- If your vehicle has a gross weight of more than 10,000 pounds or if the rated load capacity is more than 2,000 pounds
If you determine that any of these situations apply to you, then you may need to purchase commercial insurance for your vehicle.
Understand the Differences in Commercial and Personal Auto Insurance
It’s important to understand that a commercial and personal policy are two very different products. Commercial policies provide higher limits on liability. However, there are other differences in coverage as well. For instance, it may cover any new vehicles you end up buying or any hired vehicles.
You may also have trailer exchange insurance, which covers trailers even if you don’t own them. Like some personal policies, commercial insurance often includes rental coverage for times when you need to rent a vehicle while yours is inoperable.
Vehicles for Commercial and Personal Use
Many times, you may use your vehicle for both business and personal use. In these cases, you need to understand that some policies can deny coverage if an accident occurs which is not covered. You may be denied from your personal policy if your vehicle is used in business because it violates the terms of your coverage.
Should You Buy Commercial Auto Insurance?
After reading this information, you may wonder if you should buy commercial insurance for your vehicle. The first step is to read your insurance policy to find out about limitations, restrictions and exclusions. If you determine that a claim may be denied for some reason, you may need commercial insurance.
If you still aren’t clear on whether you need a commercial policy, you should talk to your insurance agent. Let them know that you will be using your vehicle for work at least part of the time. Tell them the specifics, such as how it will be used and if any equipment has been installed for work.
Make sure you protect your vehicle adequately whether you use it for home or for work. Learn whether you should purchase commercial vehicle insurance and what kind of coverage you need.
