How Much Does Commercial Auto Insurance Cost?
Getting the right commercial auto insurance for your business can be difficult. Many factors can impact the cost of your policy, including the type of vehicle you drive and your company’s location.
Liability coverage
Depending on the type of vehicle you drive, commercial auto insurance costs can vary. For example, heavy duty work trucks such as the Ford F-250 and F-350 have a higher cost because of their gross weight.
Commercial auto insurance typically includes bodily injury coverage and liability coverage. In addition to providing liability protection, commercial auto insurance protects your business from the damages caused by an accident.
The amount of coverage you choose will also affect the premium cost. Some carriers require you to choose a specific limit. Higher limits will mean higher premiums. You can also choose to add optional coverages to your policy. For example, comprehensive coverage will cover damage caused by an animal or a weather event.
Commercial auto insurance costs also vary by location. Large cities and areas that are known for being vulnerable to weather events will cost more. Also, long trips add to your costs.
The type of cargo you transport will also affect the cost of commercial auto insurance. Some companies will offer additional coverage for expensive cargo.
Commercial auto insurance costs are also affected by the make and model of the vehicle. Newer vehicles with full coverage can cost $2,000 or more.
Your driving record and the number of drivers on the policy also play a role in the cost of your coverage. If you are a seasoned driver with a good history, you will pay less for your coverage. However, if you have a poor history of driving, you will pay more.
Commercial auto insurance costs also vary depending on how many vehicles you have in your fleet. Some carriers require a certain number of vehicles for you to qualify for a discount. Some carriers also offer discounts for bundling coverage with other business insurance policies.
Property damage liability
Buying a commercial auto insurance policy may be necessary to protect your business. These policies typically include liability and property damage coverage. They also provide optional coverages for your business.
Commercial auto insurance provides coverage for bodily injury, property damage, and third-party liability. Some policies may also include optional coverages such as rental reimbursement. Liability coverage is designed to pay for the medical expenses and damages of another driver in a car accident. Property damage liability coverage pays for damages to another person’s property.
Many states require the minimum required coverage for liability insurance. Depending on the state, the minimum may be between $10,000 and $20,000 per person, per accident. Adding more coverage will increase the premiums.
Commercial auto insurance can be obtained through a bank or through a leasing company. Many small business owners can get commercial auto insurance for less than $1,500 per year. They may also have to pay a deductible for the coverage.
Some states require a minimum of $25,000 in property damage liability coverage. This amount will cover the cost of repairing or replacing another person’s vehicle. In addition, most states require third-party liability insurance. This coverage will cover medical expenses and legal fees if you are found at fault in a car accident.
The amount you pay for commercial auto insurance depends on the type of coverage you purchase. Typically, a commercial vehicle insurance policy will cost between $600 and $2,400 per vehicle per year. Some companies offer multiple discounts, which can lower the cost even more.
If your business drives a large truck, you may need to purchase additional coverages to protect your vehicle and your business. Some companies offer a comprehensive policy that will cover damages from weather events, crime, and animals. A comprehensive policy will also pay for the damage of your vehicle if it is parked or stolen.
Excluded situations
Buying commercial auto insurance can be a good way to protect your business from financial disaster. But some situations can be excluded from the policy. You’ll need to look at your policy before making a decision.
The standard business owners policy contains two sets of exclusions. One excludes claims involving a business or co-worker, while the other excludes coverage for property. You should also consider endorsements. Some of these are specialized coverages.
There are three endorsements that can help you reduce your premiums. Each one requires the signature of the named insured. However, some insurers attach endorsements to preprinted forms. The insurer will use the endorsement to make clear to the parties that are signing the forms what is and isn’t covered.
The best way to find out about the insurance policy that suits your needs is to compare auto insurance quotes from different companies. You’ll need to determine your risk tolerance, and find out how much coverage is necessary. You may need to consider completing a safe driving course to lower your insurance rates.
The standard business auto policy contains a provision that excludes accidents occurring outside of a defined coverage territory. If you’re involved in an accident while driving a car that is excluded from your policy, you may be liable for damages. You could also face a suspension of your driver’s license.
Another way to save on your auto insurance is to exclude drivers who have a poor driving record. Some insurers offer temporary coverage for driving outside of the country. You may also want to consider purchasing comprehensive coverage, which can cover damage caused by an excluded driver.
Excluding drivers from your policy can save you money on your premium, but it may not be wise if the driver causes an accident. You could face higher insurance rates and even legal fees if the driver causes damage. Depending on state laws, you may be able to sue the driver directly.
Discounts offered
Purchasing a commercial auto insurance policy can be a good way to protect your business. It can also be a good way to save money. Depending on your state and insurer, you might be eligible for discounts.
The first thing you should do when you’re shopping for insurance is ask your broker or agent if you’re eligible for any discounts. Many insurers offer discounts for various reasons, so it’s a good idea to look into them.
A discount can range from a couple of cents to a few dollars, and the average discount for a new car is between 10% and 15%. Other discounts include safety devices, which can reduce the cost of your insurance by up to 40%.
Some insurers also offer discounts for being a good driver. Typically, this means not having a lot of traffic violations in the past three to five years. Other insurers also offer a discount for being a good student.
A good student discount can be worth as much as 15%. Generally, this means you must have a B average or higher. It’s also worth checking with your insurance company to find out if you qualify for any other discounts.
Another good idea is to bundle your car insurance with your home insurance. Many companies offer a discount when you insure both of your vehicles with them.
It’s also worth checking with your insurer to see if they offer discounts for being a good student or good driver. You might also be eligible for discounts for your occupation, or if you own a home. You can even get a discount if you drive a car that’s less than three years old.
State-by-state differences
Various factors influence the cost of commercial auto insurance. The price can depend on your driving record, your vehicle profile and the type of coverage you purchase.
The cost of insurance can also depend on the state’s laws. Some states require drivers to pay for medical payment coverage, interstate coverage or PIP insurance. In addition, drivers can face steep financial penalties for failing to maintain coverage.
Insurance costs can also depend on the size of the state’s population. States with larger populations and more dense traffic densities have higher rates.
States that are more prone to natural disasters will also see higher rates. The loss of property and assets from natural disasters reached record levels in the 2010s. These losses are expected to increase with climate change.
In addition, drivers in high-risk areas may also pay higher rates. These drivers are typically more likely to be involved in accidents. Those with a good driving record and a clean record will pay less for auto insurance.
A credit-based insurance score is another factor that can affect the cost of auto insurance. Insurance companies use this score to determine whether a driver will file an insurance claim. They use the same factors that are used to calculate a regular credit score.
However, a credit-based insurance score is not the same as a FICO score. It uses the same factors as a regular credit score but weighs them differently. The score is also not the same as a Vantage Score.
Some states require drivers to carry minimum coverage, which includes bodily injury liability, uninsured/underinsured motorist coverage and property damage liability. Minimum coverage costs less than full coverage, but the protection may not be adequate.
