What is the difference between commercial and personal auto insurance?

Personal auto insurance may not be enough to cover you when you are operating a company vehicle. On top of this. a commercial auto insurance plan can cover a whole fleet of vehicles and your employees that operate them. Limits on commercial auto insurance are usually much higher and these policies often include certain types of specialty coverage not found on a personal auto insurance policy.

Do I need commercial auto insurance to drive for Uber, Lyft or another ride-share service?

Whether you need commercial auto insurance to drive for Uber or Lyft depends on the rules set by your insurance company. Some insurers require you to purchase a separate commercial insurance policy if you plan to drive for Uber, Lyft, or a similar service. Other companies allow you to add a ride-share endorsement to your personal auto insurance policy. An endorsement changes the original terms of your insurance contract, ensuring that you’re covered while you wait for ride-share customers. Before you start driving for a ride-sharing service, we recommend speaking to an insurance agent who understands the market and can help address your specific needs.

Who is covered to drive my commercial vehicle?

Commercial insurance typically covers the business owner, employees, and the business owner’s family members when operating a company vehicle. Note that for events to be covered, you must be using the vehicle for work-related reasons. A commercial policy won’t cover you if you get into an accident while driving your personal vehicle to the grocery store, for example.

Commercial Auto Insurance Explained + Best Plans for 2024

Bodily injury and property damage liability coverage

Bodily injury liability is a type of business insurance that covers the medical bills of people injured in an auto accident caused by you or one of your employees. For example, if one of your delivery drivers hits another car while driving a business vehicle, your bodily injury liability coverage would pay for X-rays, medication, and other medical services related to the other driver’s injuries. Property damage liability coverage is a type of business insurance that covers property damage caused by you or one of your employees. For example, if you back into someone else’s shed with your company vehicle, your commercial auto insurance policy will pay for the repairs. If the damage is extensive, your insurance may pay to replace the shed. Note that you can’t use commercial insurance to cover damage that occurs when you’re driving your personal vehicle for non-business reasons.

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Drive other car coverage

Commercial vehicles are versatile, but there may come a time when you need to rent, borrow, or lease a different automobile. If so, consider getting “drive other car coverage”. This type of insurance extends your commercial auto coverage to a vehicle that isn’t owned by your company. For example, if you have to borrow an employee-owned vehicle, drive other car coverage will cover the cost of repairs if you get into an accident.

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Medical payments (MedPay) coverage

Medical payments coverage, also known as MedPay, pays your medical expenses if you’re injured in an auto accident. It also covers medical expenses for your passengers. For example, if you and an employee get into a serious accident while riding in a commercial vehicle, MedPay coverage will cover the cost of X-rays, lab tests, surgery, and other related medical services.

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Collision coverage

Collision coverage pays to repair or replace your commercial vehicle if it’s damaged in an accident. The good thing about collision insurance is that it covers a wide range of scenarios. For example, if someone hits your parked car and leaves the scene of the accident, your collision coverage will pay for the repairs. Collision coverage also applies when you hit a telephone pole or another stationary object.

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Comprehensive coverage

Comprehensive coverage pays for expenses arising from non-collision claims. For collision coverage to apply, your vehicle has to collide with something, whether it’s a guardrail, a curb, or another automobile. That’s not the only way to damage a business vehicle, however, so you need extra coverage to protect your assets. Comprehensive coverage may pay for repairs related to hail damage, fire damage, theft, and other non-collision claims.

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Personal injury protection (PIP)

PIP covers accident-related medical expenses without regard for who caused the accident. In some cases, this type of insurance also covers lost wages, funeral expenses, and/or the cost of hiring someone to perform household services while you’re recovering from your injuries. Some states require PIP coverage, so check with a licensed insurance agent to determine if you need to add it to your policy.

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Rental car coverage

If you rent a vehicle, it’s important to purchase rental car coverage beforehand. This type of insurance pays for repairs in the event your rental is stolen, vandalized, or damaged in an accident. For example, if you scratch the side of the vehicle while trying to park in a tight space, your rental car coverage will pay a body shop to fix it.

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Uninsured motorist (UM) coverage

When you drive on public roads, there’s always a chance that you’ll encounter someone who doesn’t have any auto insurance. If an uninsured driver hits you, they probably won’t be able to cover your medical bills or pay for the damage to your vehicle. UM coverage covers any property damage and/or medical bills arising from an accident involving an uninsured motorist.

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Underinsured motorist (UIM) coverage

Even if a driver has insurance, there’s no guarantee that they’ll have enough insurance to cover your accident-related expenses. In other words, they may be underinsured. Like other coverage options, UIM insurance gives you extra protection. If you get into an accident with an underinsured motorist, your UIM coverage will cover your expenses, ensuring that you don’t have to pay them out of your own pocket.

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