Why Do I Need Commercial Auto Insurance?

Why Do I Need Commercial Auto Insurance?

May 23, 2019

Why Do I Need Commercial Auto Insurance?

Most contractors already know that they need special insurance compared to the general public. For example, a contractor may know that if he or she doesn’t have a certain level of contractor license bonds in California, his or her business can be shut down. However, if you own a small business, you might not believe that you need a special commercial auto policy. After all, your personal policy covers you even though you use your truck for your landscaping business…right?

Unfortunately, personal auto insurance policies often deny coverage for commercial activities—and if you don’t have the right protection, you can be left with a massive bill. Commercial auto insurance policies offer coverage for vehicles that you use for business as well as for your commercial drivers.

Commercial policies differ from personal auto insurance policies because they’re more expansive. Because commercial vehicles tend to be heavier and cause more damage, commercial limits are often much higher than personal policies. Commercial policies also provide coverage for additional structures attached to your commercial vehicle. For example, if you have a hook attached to a truck that you use for your towing business, damage to it would only be covered under a commercial policy.

As a general rule, if any of the following apply to your vehicle, you need a commercial policy:

  • You use the vehicle to transport equipment to or from a jobsite.
  • You use the vehicle to make deliveries.
  • You hire the vehicle out to tow other cars or trucks.
  • You own a vehicle that requires a Commercial Driver’s License to operate, like a cement mixer or truck.
  • You use the vehicle to transport passengers.

Not sure if you need a commercial policy? Don’t have the contractor license bonds in Arizona your business needs? DJM Insurance Services is your one-stop-shop for protecting your livelihood. Give our team a call today to learn more or get started.