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By definition, commercial auto insurance is an insurance plan that covers company-owned motor vehicles used for conducting business. These policies typically cover damages due to theft or vandalism and help protect businesses against liability for damages and injuries caused by accidents.

The types of vehicles that are covered vary by business, but can include:

  • Cars owned by the business
  • Utility trucks
  • Delivery vans
  • Dump trucks
  • Construction vehicles, including forklifts
  • Foodservice vehicles

What Kinds of Insurance Customers Need Commercial Auto Insurance?

Any company that requires the use of vehicles to get the job done (other than commuting). Examples include: 

  • Food truck owners and caterers or restaurants who transport food to onside locations
  • Businesses that require service utility vehicles, such as construction companies, engineering firms, plumbers, landscaping companies, electricians, and tow trucks
  • Commercial farmers who use pickups, livestock transport vehicles, or dump trucks
  • Delivery service providers
  • Funeral homes vehicles like limousines, hearses, or escort vehicles
  • Big box and local stores that deliver goods ranging from furniture to pizza

What Types of Coverages Might Be Included?

Commercial auto coverage requirements may vary from state to state for companies who use various vehicles during the course of business, but generally, these types of coverages are available in commercial auto policies:

  • Bodily Injury Liability: Compensate for injuries or fatalities when the business vehicle is determined to be at fault
  • Property Damage Liability: Offers protection in the event that a company-owned vehicle accidentally causes property damage on the job
  • Medical payments: Typically covers medical expenses associated with a covered accident for the driver and passengers
  • Uninsured motorist coverage: Pays for injuries and sometimes property damage caused by an uninsured driver or even a hit-and-run accident
  • Comprehensive physical damage coverage: Covers damage to the vehicle resulting from theft, vandalism, and covered perils (flood, fire, etc.)
  • Collision coverage: Pays for damage to the vehicle in the event of a collision

Why Do Businesses Need Commercial Auto Insurance?

Commercial auto coverage can be a life-saver – especially for small to medium-sized businesses that use vehicles for work-related tasks, meetings, and deliveries. And more importantly, it’s required in almost every state, though minimum coverages may vary, depending on state laws.

When discussing policy needs and requirements with prospects and clients, consider asking some of these questions to help guide the sales call:

  • Does your company own vehicles that are used daily in the course of business?
  • Do you ever require the use of a courtesy vehicle for clients, like dropping them off at an airport or hotel?
  • Does your business require employees to go on service calls, go to the post office stop, drop off packages for shipping, or shop for any sort of \ supplies? 
  • Does your business deliver food, groceries, home items, or other consumer goods?
  • Do you ever need to haul considerable weight (equipment, tools, livestock, etc.)?
  • Do you or your employees transport products for work-related purposes?
  • Do you or your employees log a lot of mileage in the course of the job?

How to Grow Your P&C Book of Business 

Though the profitability of commercial auto insurance continues to vary due to a variety of factors in the post-Pandemic economy, market studies show that gains are expected in the next few years to come.

Growing a solid book of business with this line requires building a trustworthy, friendly, and knowledgeable reputation and partnering with providers like AgentCubed, who can help you grow and sustain customer relationships, every step of the way and through market changes and as new opportunities arise.

Want to talk to our team about how our combined platform can help you get the job done? Just click here.

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