Choosing between different types of commercial car insurance – the easy way

Running a business that uses cars can be tough, but dealing with commercial auto insurance can be tougher, especially if you don’t know which one to choose. One of the most challenging decisions you will make as a business owner is choosing the right insurance policy that can protect your assets and your employees from unexpected financial losses and the threat of a lawsuit. The first step in choosing the right type of auto insurance is understanding the different types of commercial insurance available.

Basically, commercial auto insurance splits vehicles into two main categories:

  • The private passenger type cars, such as cars, vans, SUVs and small trucks

  • Trucks, trailers and tractors including Pickups, Dump Trucks, Dry Freight, Cool Box, Car Transporter, Tanks and so on.

There are two main categories of commercial auto insurance: general insurance and specialty commercial auto insurance.

General Commercial Motor Insurance consists of six types of coverage:

  1. Extended coverage: This type of coverage comes into effect when a vehicle is destroyed or damaged by something other than another vehicle, such as an animal or a fallen tree.
  2. Collision insurance: This type of insurance covers damage to a vehicle that occurs when the vehicle is struck by another vehicle or object or when the vehicle overturns. This type of insurance is highly required for vehicles with loans or leases on them.
  3. Uninsured/underinsured motorist: This type of insurance covers damage and medical costs incurred in the event of an accident caused by a motorist who is uninsured or underinsured.
  4. Liability insurance: This type of insurance is generally required by most states. It comes into effect when you cause an accident. It not only protects you from harm but also provides you with a legal defense in case the other party files a lawsuit against you. “Liability for property damage” covers damage to the other party’s car or property, while “liability for personal injury” covers injury or death as a result of the car accident.
  5. Medical Coverage: This type of insurance covers medical expenses incurred by anyone in your vehicle as a result of a car accident, regardless of whose fault the accident is.
  6. Protection against personal injury: This type of insurance covers injury-related costs that you or your employees incur in an accident, regardless of whose fault the accident is.

The Specialized Commercial Auto Insurance is intended for companies that require the use of specialized vehicles in carrying out day-to-day activities. Some common types of custom coverage designed to protect specialty vehicles include catering truck coverage, landscape vehicle coverage, and trade-related vehicle coverage.

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In short, regardless of the type of business you run or the type of car you use, a commercial insurance policy can be tailored to your specific needs.