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Understanding Commercial Auto Insurance: What’s Covered?
Aug 4, 2025
If your business relies on vehicles—whether for deliveries, service calls, or employee transportation—you need more than just a standard car insurance policy. Commercial auto insurance is designed to protect your business from the risks that come with operating vehicles for work. But what exactly does it cover? Let’s break it down.
1. Liability Coverage
This is the core of your policy and protects your business financially if your driver is at fault in an accident:
Bodily injury liability: Covers medical costs and legal expenses if someone is hurt.
Property damage liability: Pays for damage to other people’s property.
2. Collision Coverage
If your company vehicle is damaged in a collision, this coverage helps pay for repairs or replacement, regardless of who caused the accident.
Tip: Personal auto insurance often excludes business use—so without commercial coverage, you could be stuck paying out of pocket.
3. Comprehensive Coverage
Accidents aren’t the only threat to your vehicles. Comprehensive coverage protects against:
Theft or vandalism
Fire or explosions
Natural disasters like hail or floods
4. Uninsured/Underinsured Motorist Coverage
Not everyone on the road carries enough insurance. This coverage steps in to cover damages if your vehicle is hit by a driver with little or no insurance.
5. Medical Payments (Optional in Some States)
Covers medical expenses for you or your employees in the company vehicle—no matter who’s at fault.
6. Optional Add-Ons
Consider expanding your protection with:
Rental reimbursement – Covers a temporary vehicle if yours is in the shop.
Roadside assistance – Towing, lockouts, and flat tires.
Hired and non-owned auto – Covers vehicles your business rents or employees use for work.
Having the right commercial auto coverage ensures that an accident doesn’t stall your business. If you’re unsure about gaps in your current policy, now’s the perfect time for a coverage review.
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