Business vehicle insurance remains essential today. This coverage protects the business in the event there is a driving-related catastrophe. What type of coverage is offered, when is it needed, and why?
Insurance Coverage
The policy provides bodily injury and property damage coverage. The insurer pays any medical expenses related to the incident and will cover legal expenses if a party to the accident decides to file a lawsuit against the business.
In addition, the policy will cover collision and comprehensive damage. It protects the business in the event an employee is involved in an incident with someone who is uninsured or underinsured. Furthermore, the policy may cover an auto loan or lease if the vehicle is declared a total loss.
When is Business Vehicle Insurance Needed?
Every business that uses a vehicle in normal operations must obtain this type of coverage. When someone asks about those business vehicles that need insurance, any vehicle used to carry out operations should be included in the policy.
The construction, catering, and delivery industries maintain this type of insurance. However, business owners who uses their personal vehicles to deliver documents for work should invest in it as well. This ensures they are protected if an accident occurs while they are making this delivery. Speak with an agent to determine if business vehicle insurance is required.
Personal Vehicles
A business owner might believe that an employee using their personal vehicle while on the job is covered under their personal auto insurance policy. That is not the case, and the business could discover this the hard way. It falls on the business owner to know what coverage is needed and why.
Why is Business Vehicle Insurance Essential?
Every business needs to have adequate insurance. The business owner doesn’t want to pay out of pocket for any expenses related to an incident, as doing so will harm the company’s cash flow. With insurance in place, this concern can be laid to rest.
A lack of sufficient insurance could hurt the business in other ways. For example, a car may be in an accident. Without rental reimbursement coverage, the owner of the business will be short one car while waiting for theirs to be repaired. The only other option will be to pay for the rental out of pocket.
The Right Level of Protection
Having insurance isn’t enough. The business owner must ensure they have the necessary level of protection. If they don’t have this protection, any expenses above and beyond the policy’s limits become their responsibility. This also interferes with the organization’s cash flow. Speak with an agent to determine the necessary levels of coverage.
Most insurers allow business owners to choose different coverage for vehicles. The owner won’t need to insure a 20-year-old truck at the same level they insure a truck that is only a few years old.
Additional Steps
When hiring employees, business owners must determine whether the potential employee will drive a company vehicle. If so, they need to check their driving record. A good record could lower the company’s policy premium. Furthermore, the company must establish guidelines for employees when they are behind the wheel and clearly communicate these policies.
Always work with an experienced insurance agent to ensure the right level of coverage is obtained. Business owners who do so find they have good coverage at a reasonable price. This is one area where corners cannot be cut, as inadequate insurance could lead to the business closing its doors forever.
