Commercial vehicle insurance protects everyone who drives as part of their business, including ride-share operators and pizza delivery drivers. If these persons experience an accident on the job in their own vehicle, they may be unable to file a claim under their personal auto policy. If you drive a car owned by the firm where you work, the business must have a commercial policy on the vehicle. Is commercial auto insurance cheaper than personal coverage?
Factors Impacting the Cost of Commercial Vehicle Insurance
Insurance companies charge considerably varied premiums for various drivers based on the type of vehicle, personal driving history, and other criteria. On average, though, most motorists pay more for commercial vehicle insurance than they do for personal coverage. That’s because commercial policies cover at least $500,000 and up to $1 million in losses, compared to the significantly lower coverage limits for personal policies.
Factors that affect commercial vehicle coverage pricing include:
- Whether you have a history of claims on your auto insurance coverage
- The planned business usage of the vehicle
- Whether anyone else will drive the vehicle and that person’s driving history
- The weight of the vehicle if you drive a commercial truck
- How much the vehicle cost when new
- Identifying information about the car, such as its year, manufacturer, and model.
Given that claims involving commercial vehicles insurance are typically significantly more expensive than claims involving personal vehicles, the greater cost of commercial insurance is a direct reflection of the higher risk to the insurance provider.
However, commercial vehicle insurance offers a few additional features not found in private auto insurance, such as:
- Damage to a commercial vehicle that occurs during loading or unloading is covered by “loading and unloading liability.”
- Coverage for the cost of replacing broken tools and other equipment in your vehicle in the event of an accident.
- Insurance for anybody other than the vehicle’s owner who needs to use it is called “non-owner coverage.” This could include, for example, a company’s employees or other people.
According to Bajaj Finserv, you are not covered while driving for work unless you have a business policy. So it becomes very essential to have commercial vehicle insurance.