Do You Need Auto Insurance for Your Business?

As a business owner, you should know that almost every state requires commercial auto insurance if there are business-owned vehicles and employees that operate them. You won’t legally have a choice in the matter if this is your s situation. Our team at the Insurance Center of Green Valley, AZ understands this and is here to help business owners navigate commercial insurance requirements as well as any coverage they may need to safely run their business. 

It’s the Law…for the Most Part
Most states require businesses to purchase commercial insurance if there are cars that fall under the company name, or owned by the company. Also, company vehicles that are used by employees to transport clients and equipment, and drive to job sites require commercial insurance coverage. Personal car insurance is generally not designed to cover commercial or business needs if those terms aren’t stated in the policy. This is significant because involvement in a job-related car accident could invalidate your personal insurance policy. 

Why Personal Car Insurance May Not Cover Commercial Use
Many personal insurance policies have an exclusion that clearly declares that there’s no coverage for personal vehicles that are used for business purposes. This is one of the many reasons why it’s important to purchase a policy that is designed for the specific use of a vehicle. The right insurance coverage will protect both you and your employees legally and serve the purpose of the vehicle more accurately. Where your personal auto insurance policy would fall short, a commercial insurance policy would provide more coverage for a vehicle used for commercial purposes. 

Other Considerations
Personal auto insurance is less costly than business insurance. A car used for commercial purposes is more than likely more frequently driven, hence, more prone to accidents and liability, particularly if you are transporting clients or business equipment. The increased risk usually translates into higher costs. If you have questions regarding whether or not you need commercial auto insurance, give us a call. We’re here to help.