It seems like every time a business owner turns around they need to spend money on something else for their business. It may sound tempting to save money by cutting corners on commercial auto insurance for your company. However, an area where spending some extra money now can save you thousands of dollars in the long run. Investing in commercial auto insurance is a financially prudent decision for business owners. It also has several other benefits as well. Following are six reasons to invest in commercial auto insurance for corporations.
1. Registered Drivers
One of the most important factors you need to look at when deciding on commercial auto insurance is the person to whom the car is registered. If the car is registered to the business rather than a particular individual, it is crucial that the car is insured under a commercial policy. However, that is not the only consideration. Even if the car is registered to an individual, it may still need to be covered by a commercial policy. If the primary use of the car is business related, it should be insured with a commercial policy, even if it is registered to the business owner and not the company.
2. You Perform Work-Related Tasks in Your Vehicle Often
If you only carpool to work with your coworkers on a daily basis, it is unlikely you need a commercial insurance policy. Any accident damages or injuries that are incurred while carpooling should be covered under a personal auto insurance policy. But if you use your car to drive to a client or a work site, having commercial auto insurance will protect you if you are in an accident. Further, if you drive clients as part of your job, complete work-related tasks while in your car, or cross state lines to transport goods, you also need commercial auto insurance. If you get into an accident and a client is injured, a commercial auto insurance policy will cover injuries sustained by the client while personal auto insurance policies will not.
3. Employees Need to Drive for Work-Related Purposes
If employees or coworkers drive a vehicle for work purposes, you need to have a commercial auto insurance policy. Employees, coworkers or anyone else connected with the company will not be covered under a traditional personal auto insurance policy. However, if these individuals need to drive a company car, a commercial auto insurance policy will protect them – even if their driving use is only occasional. Further, a commercial policy will also protect an employee if he or she uses a personal car for work-related activities. Most commercial policies will even cover rental cars that are used for work purposes.
4. Commercial Auto Policies are Comprehensive
Specialty insurance policies are often limited in their coverage. However, this is not the case with commercial auto insurance. A commercial auto insurance policy offers the same type of overall coverage that a personal auto insurance policy does. A corporation that invests in commercial auto insurance will be protected with a full range of coverage including bodily injury liability, property damage liability, medical payments, uninsured motorists, comprehensive physical damage, and collision.
5. Having Commercial Auto Insurance Can Help Lessen the Damage of a Lawsuit
No business wants to be embroiled in a lengthy and costly lawsuit. Just one accident with a company vehicle that is not properly nor adequately insured can mean financial ruin for any business. A business that faces a lawsuit for a car accident can be forced to pay out money for any damages that result from an accident where the driver of the company vehicle is at fault. If injuries or property damages are severe, the cost could be more than even a large corporation could absorb without difficulty. When there is commercial auto insurance in place, the coverage will absorb a large portion of the costs, allowing the business to continue as usual without having to use company money to pay for the damages.
6. It Could Be the Law
Many states require any car used for business purposes to be covered by commercial auto insurance. Just as most states require all everyday drivers to be covered by a personal auto insurance policy, it is the same for commercial vehicles. Business owners should be familiar with the insurance laws that govern their state and act accordingly.
Making sure any vehicle used for business purposes is properly and adequately insured is a major responsibility of any corporation. Having commercial auto insurance satisfies practical, financial, and legal responsibilities of corporations and businesses of any size. If you have questions regarding commercial auto insurance, or would like a quote on coverage for your business, contact an experienced local insurance agent to learn more.
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