How to Know if Your Commercial Auto Insurance Policy is Enough
Not all commercial auto insurance policies are created equal and it is important to review your policy at least once a year to make sure you are still getting the right coverage for your business’ vehicles.
It is important, as a business owner, to mitigate risks and manage liabilities. This includes understanding the risks associated with your employees use of any automobiles owned or leased by the business. A checkup performed on your commercial auto insurance will help you understand how best to manage loss and maintain the proper reserves necessary to meet any unfunded liabilities.
What Does Typical Commercial Auto Insurance Provide?
A proper full coverage commercial auto insurance policy should include:
Comprehensive Coverage: Comprehensive coverage provides compensation for damages to the vehicle caused by fire, wind, hail, lightning, smoke, falling objects, theft, vandalism and more.
Collision Coverage: Collision coverage provides compensation for damages to the vehicle caused by a collision with another vehicle or object.
Liability: Liability insurance covers bodily injury and property damage the driver may cause someone else while operating the insured vehicle.
Medical Payments Coverage: Medical payments coverage provides compensation for medical bills the driver and their passengers may face after an accident, no matter who is at fault.
Uninsured/Underinsured Motorist: This insurance covers damages incurred in an accident with another driver who is not carrying insurance at the time.
Roadside Assistance: Roadside assistance covers expenses related to trip interruptions such as popped tires, running out of gas and needing to be towed.
You should also have Hired or Non-Owned Auto added to your commercial auto insurance policy, which covers vehicles borrowed or rented by your business for work purposes.
How Do I Know If A Gap In Coverage Exists?
Coverage gaps can occur when the valuation method used for total loss is for the book value and not the actual replacement value of the vehicle. This can become a huge liability for your business if, for example, the remaining liability for a covered auto is more than the amount of reimbursement (claim amount) provided by the insurance company.
Be sure to shop around and find an insurance provider that can pair you with the coverage you need at the price your company deserves. Avoid paying too much for too little coverage by comparing quotes and speaking with an insurance professional about insuring your business’ vehicles.