7 Common Commercial Auto Insurance Myths – Debunked

Posted on: 3 November 2014

Commercial auto insurance can protect your business vehicles, including cars, vans and trucks, in the event of an accident. According to DMV.org, business owners who employ drivers for transportation or delivery purposes may be required by their state to carry a certain amount of commercial liability insurance. In the commercial car insurance industry, there are numerous myths that can affect a business owner when shopping for coverage. Here are some of the most common myths debunked.

1. Employees are covered when they drive business vehicles.

It is a common misconception that all employees are covered by the business owner's commercial auto insurance when driving business vehicles. Some insurance companies will only provide coverage to drivers who are included on the policy. Business owners who want to have all of their employees covered require "permissive use" coverage. This type of coverage covers all employees as long as they have permission by the business owner to operate the vehicle.

2. Commercial auto policies cover tools and equipment left in the vehicle.

Although the tools and equipment you leave in your vehicle may be used for business purposes, these items will not be covered by your commercial auto policy in the event that they are stolen or damaged. Only equipment that is permanently attached to the business vehicle is covered. Extra coverage can be sought to cover certain business supplies while in transit.

3. Insurance for seasonal businesses should be cancelled in the off-season.

Some businesses cancel their commercial auto insurance during the off-season as they run seasonal businesses. While canceling your auto insurance during the off-season can certainly save you money, it leaves your business vehicles unprotected. Although liability insurance may not be needed, your auto insurance can also protect your business vehicles against theft, vandalism, and damage from bad weather.

4. Personal auto insurance can be used to cover on-the-job duties.

Private vehicles should never be used for business purposes. If your personal vehicle is used for anything but personal use, it's best to extend your personal auto policy to cover business use in your vehicle. Contact your insurance company to see what options are available to you for extending your private auto policy or purchasing a new commercial auto policy.

5. It's cheaper to buy all your insurance products from the same company.

It may be more convenient to purchase all of your insurance products from the same company, but it's not necessarily cheaper. In fact, you can save a significant amount of money by shopping around and comparing prices. The company where you get your private auto insurance may be different then the company you get your commercial insurance from. Ask local agents for quotes from multiple insurance companies or click here for info on ways to get the best prices on your auto insurance.

6. Business owners must pay insurance premiums in full up-front.

While this is true in some cases, it's not true for all commercial auto insurance companies. Some insurers allow you to pay your insurance premiums in installments with a low initial payment. However, there are benefits to paying your insurance premiums in full up-front. Some insurance companies will offer you discounts if you pay in full.

7. All commercial auto insurance companies are open 24/7.

While you may find that some insurers are available to answer your calls round-the-clock, many are not. In fact, most insurance companies are only open during regular office hours during the week. This can make filing a claim or paying your bills inconvenient. However, most insurers now have interactive websites and 24/7 phone service for customers who need service anytime during the day or night.

There are numerous myths surrounding commercial auto insurance. For more information about commercial auto insurance or to get a quote, contact your local insurance agent.