Demont Insurance Agency Blog

Business Auto Insurance Details

Maintaining a business means spinning a lot of plates and micromanaging every aspect of day to day operations. Keeping track of every detail to the last cent is a tough job, and even then, accidents can happen, sending those plates crashing to the ground.

For instance, you find out that your delivery truck has had an accident on its way to a delivery. You now face the daunting reality of investing your savings in a new vehicle. Savings that were meant to pay off your child’s tuition or take your spouse on the vacation you both have been dreaming of. Crushing, right?

The very presence of a vehicle means the ever-present possibility of accidents, theft, or damage caused to the interior or exterior of your vehicle. Important equipment can get stolen, personal items destroyed. The risk keeps growing as you add more vehicles to your business.

This is where business auto insurance comes in.

What Is Business Auto Insurance?

Business auto insurance, also referred to as commercial vehicle or commercial auto insurance, is a commercial insurance policy that provides coverage for physical damage or liability for vehicles you use for business purposes.

Vehicles are an essential part of modern-day business. From a sole-proprietor picking up clients merchandise and ensuring timely deliveries to shipping companies that are heavily dependent on their trucks – vehicles are an absolute necessity. And so is ensuring their safety.

Any damage caused to another vehicle can leave the company in financial ruins in the absence of business auto insurance. Having a commercial vehicle policy gives the peace of mind that the insurance provider will cover the accident.

Who Should Get Business Auto Insurance?

Every business that makes use of a vehicle for business purposes should obtain commercial auto insurance.

Damage to the vehicle also causes injuries to the driver, a passenger, or any equipment carried in the car. Repairs, medical bills, and coverage for the loss of equipment can make a substantial dent in a small or medium sized business’ financial standing – further demanding the need for business auto insurance.

Additionally, designed to cater to business needs, business auto insurance carries a higher coverage amount than regular insurance policies. Typical coverages range from $250,000 to as high as $1 million, based on several factors.

Some businesses are proven to be ‘riskier’ than others. Therefore they are afforded higher coverage amounts. Such business-oriented policies are better suited to vehicles constantly on the road as opposed to personal vehicles.

The Difference Between Personal and Business Auto Insurance

There is a misconception that small and medium-sized business owners can use their personal insurance policy as coverage for an incident involving their company vehicle.

Personal and commercial vehicle insurance policies are rated different, termed differently, and the events for which coverage is allowed are also different. A personal car insurance policy is unlikely to cover such things as: physical damages, medical bills, or costs for the equipment involved in a business-related vehicle accident. Moreover, your personal policy will not list the business’ driver(s) as an authorized driver.

In addition, some businesses make use of vehicles such as box trucks, food trucks, work vans, service utility trucks, and container trucks, which are not classified as personal vehicles. These vehicles are used to deliver goods, transport equipment, cater to clients and employees and transport materials for production. Their time on the road produces risk, and the added risk further stresses the importance of having a business auto insurance policy.

Types of Coverages Business Auto Insurance Offers

Commercial Auto Insurance covers much like a standard auto policy, but it is designed for the business owner.

These are some types of coverages offered by business auto insurance:


  • Bodily Injury: Coverage designed for businesses to recover financial losses resulting from an accident that causes injuries to the other party in the incident. In the case of a lawsuit, most coverages will also provide you with legal costs.


  • Personal Injury: Medical coverage, loss of wages and in extreme cases – expenses for the driver’s funeral who was involved in the accident.


  • Comprehensive Coverage: Comprehensive coverage is insurance for the company vehicle for events other than an accident. These events may include theft, fire, vandalism or a natural occurrence such as a hurricane. Such events are listed explicitly in the insurance policy, and the coverage is limited to the mentioned events.


  • Collision Coverage: Collision Coverage extends beyond providing coverage for collision with a vehicle. Some policies provide insurance for collision with a tree, lamp post, or any other foreign object due to bad weather or natural circumstances.

Final Thoughts

Providing your business vehicles with an insurance policy is a step towards ensuring a safer business, as well as peace of mind in case the unthinkable happens.

It not only protects the vehicle, but the people are driving it, as well as ensuring the financial burden of replacing the damaged vehicle is not all on your shoulders.

To learn more about Business Auto Insurance, contact the experts at Demont Insurance Agency  at (850) 942-7760. Our licensed insurance experts will be happy to answer any questions you have.


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