When Do You Need Commercial Car Insurance?
Any vehicle used for business, either your own business or an employer's, is considered a commercial vehicle. This includes all types of vehicles. A few examples would be:
Cars (individual and fleets)
It doesn't matter if the vehicle is leased or owned outright, or if you own one car or an entire fleet you must carry commercial auto insurance. State laws require businesses to carry commercial auto insurance. The Businessowners Policy (BOP) does not cover vehicles used by the business.
Vehicles are also required to have this insurance if they are fitted with snowplowing equipment, cooking or catering equipment, hydraulic lift equipment or bathrooms. If you regularly transport customers it is also required.
Commercial insurance is similar to other auto insurance in that you must have liability coverage, but usually at a higher required amount. In addition, there are several add-ons (called riders) that are specific to businesses. Riders can be obtained to cover employees, equipment, loading and unloading of that equipment, and even the assets of the business itself. You should also obtain comprehensive and collision coverage, medical coverage (personal injury protection), underinsured / uninsured motorists coverage. Additional specific riders are also available for different industries.
The coverages offered usually are one of three types:
All the automobiles owned by the business
All the automobiles owned by, hired or leased by the business
All the automobiles used by the business even if they do not own them hired or leased them
If your vehicle is only used occasionally for business you may qualify for sporadic business use insurance. The vehicle's use cannot be primarily for business purposes. Conversely, if you are driving a commercially insured vehicle for personal use, you will not be covered if an accident occurs.
Your state will have requirements for the amount and type of insurance they require. At a minimum, you must have at least the same insurance needed for a personal auto. Be sure to inquire into your state's requirements.