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Don't Go In Reverse When It Comes To Business Auto Insurance
by Heather Legg Tue, 02/19/2013 - 10:45
There is a lot to think about when you own a small business.
Not only do you have to think about offering insurance to your employees, but you also have to think about auto insurance for company vehicles, or any vehicles used for business purposes.
This is not something to skimp on, as you don’t want to end up paying big bucks if something happens, or worse, risk your business.
Here are some important facts you should know about business auto insurance...
When should you have business/commercial auto insurance as opposed to personal auto coverage?
A few major factors come into play here, and if these things apply to you and your business, you need commercial/business auto insurance:
* If your vehicles are registered under a company name instead of a private owner, you need business auto insurance.
* If you’re vehicle’s primary use is business, you should have business auto insurance.
* If your employees are driving your car or other vehicles for business purposes, or their own, you should have business auto insurance to cover them. With a commercial policy, you can list your employees as drivers on the cars.
Though personal and business auto insurance policies may be similar, there can also be some important differences in coverage, limits, definitions and eligibility that will make a big difference if something happens.
How is business use determined?
If your car or other vehicle is used regularly for business purposes, you may qualify for (and you should purchase) commercial auto insurance. These policies are also sometimes called fleet insurance or truck insurance.
Here are some examples of business use:
* Carrying equipment like ladders, tools and other supplies and/or equipment like cranes, tows and snowplows
* Messenger or driver
If your primary purpose is driving to and from work, that will not constitute business auto coverage.
You can have coverage on your own vehicles for you or someone else, and on your employees’ vehicles if they fall into the category of business driving use.
Why should you have business/commercial auto insurance?
If you are your employee are driving for business purposes and cause a wreck where costly damage ensues, private insurance may not pay for it because it took place under a business purpose. If the damages cannot be paid, they will have to come from the business, and this can cause a lot of problems, even bankruptcy and the end of the business.
Even if your employees are driving their own vehicles, you should still cover them under a business/ commercial auto insurance plan. If damage occurs and it took place under business circumstances, a personal insurance plan may not provide coverage even if they were in their own car.
Though the cost of extra business insurance may seem unnecessary, it will cover many things that personal auto insurance won’t. It’s best to cover your vehicles and employees, and safeguard your business.
Remember, no one wants an accident that someone else caused to be the downfall of their small business.
About the author
Heather Legg is a freelance writer who covers a variety of topics from small business ideas to family fun.