Understanding Commercial Auto Insurance

Liability coverage will help pay for injuries to others or property in a car accident where you're at fault. This means that if you are sued for causing an accident, your liability insurance will cover the cost of the damages. 

Commercial auto insurance also includes collision insurance. This can cover accidents caused by you or others. 

However, it can also cover collision costs that come into play due to a natural disaster or vandalism. 

If you or a passenger needs medical care after an accident, commercial auto insurance will cover the medical bill. With the cost of medical care, this can be a huge help when it comes to costs related to an accident. 

Keep in mind that commercial vehicle insurance only covers medical costs if it happens when driving your commercial vehicle. 

If you or one of your employees is in an accident and property gets damaged, this part of your insurance will cover you. Remember, not only will you be responsible for the cost of the property damage, but you'll also be responsible for the cost of vehicle repairs. 

If you get sued for damages in a car accident that involves your commercial vehicle, commercial auto insurance can help. Your plan will keep you covered and help you navigate the complications of a lawsuit. 

Did you know that in Ontario, it's estimated that there are 2,000 vehicles involved in an accident every year that are uninsured? In addition, it's estimated that around two percent of all drivers on the road don't have insurance. 

While everyone should have insurance, that's not always the case. If a driver doesn't have insurance, this part of your commercial insurance plan can help cover the costs. 

Every business is going to have different requirements for their insurance. If you want a plan that meets your specific needs, look for insurance companies that offer customized plans. 

This will allow you to choose what is essential for your business. You can meet with your insurance company and write up a policy that meets your needs. 

The coverage needed for a truck will look a lot different than what might be needed for a car. You can pick plans that cover big or small vehicles. 

Because the financial cost of repairing either vehicle is vastly different, you want a policy that gets based on your potential costs. 

Does your company have only one vehicle versus a fleet? You can get a commercial auto insurance plan that covers a single vehicle. 

Even with a single-vehicle plan, your vehicle can get driven by you or employees. 

Third-party liability insurance covers a person that is not related to your business but comes into contact with it. For example, customers, suppliers, partners, distributors, clients, and others that interact with your business but aren't associated with it in other ways would be a third party. 

Third-party liability insurance will cover property damage or bodily injury that a third party claims your business is responsible for. For example, if you regularly transport clients as part of your business and you are in a car accident, third-party liability can help cover those costs. 

Direct compensation Property Damage Insurance or DCPD insurance provides you compensation when you are injured, or your vehicle is damaged in an accident that wasn't caused by you. 

Instead of having to jump through hoops and deal with the other party's insurance, you deal with your own insurance. This means you do not need to wait extended periods of time for the at-fault parties insurance company to make a determination. 

In addition, you won't need to worry about having to sue the driver who is at fault. This is great to have for any policyholder. 

Accident benefits cover you, pedestrians, and passengers who get injured in an accident. For accident benefits, it doesn't matter who was at fault. 

These benefits can cover: 

• Income replacement
• Rehabilitation treatment
• Other recovery services
• Funeral expenses
• Compensation for family members in the case of a fatality

It's also going to help if the car accident kills someone. This type of coverage is mandatory in Canada. 

The only areas exempt are Labrador and Newfoundland. In Ontario, accident benefits cover more than what is listed above. 

Alternative Caregiver

If an individual injured in the accident can no longer provide care for their dependents, accident benefits can help. This benefit will provide compensation for an alternative caregiver. 

Other Expenses

There are other expenses that are covered in Ontario too. Some of these include: 

• Replacing items damaged in the accident
• Home maintenance
• Lost educational expenses

In addition, if you're not able to lead a normal life and don't qualify for the caregiver benefit or income replacement, accident benefit can offer compensation here as well. 

Does your employee drive a personal vehicle for work? If so, they aren't automatically covered by your business' policy. 

In addition, they might not get covered by their own insurance if they're in an accident while working. 

Your commercial auto insurance also won't cover leased vehicles. 

If you want your commercial auto insurance to cover leased or personal vehicles, you will need to add additional coverage. This coverage will be "Hired or Non-Owned Vehicles." 

It's specifically for cars that your business does not own. 

Do your employees take work vehicles home or run personal errands with them? If so, this should get covered by your commercial auto insurance. 

However, even though it should get covered, there may be limits. You will want to talk to an insurance agent about personal use and what those limits might be.

There are some other instances where your vehicle might not get covered. If one of your hired employees uses your commercial vehicle while committing a crime or causes intentional damage with your vehicle, it might not get covered. 

In addition, it might not cover accidents that are caused by employees who have been drinking or using drugs. 

The ability to customize your plan to meet your needs is very important. We discussed this some above.

Your coverage needs might be different based on what the vehicle's getting used for or your industry. 

It lists different add-ons you can get for your plan. 

They also list optional coverage add-ons that could be beneficial to your policy. 

If your vehicle is damaged in an accident that's not a collision, you'll want to have comprehensive insurance. Some of the losses it can cover include: 

• Hail
• Hitting an animal
• Theft
• Vandalism

This is optional coverage. However, it's a good one to have to protect your business finances.

Don't get stuck on the side of the road and end up paying expensive towing costs. If your vehicle breaks down, you want to know you will have roadside assistance on the way. 

You can get this covered in a commercial auto policy. 

Because this is mandatory in the majority of Canada, you want a company that provides this insurance. Remember, as discussed before, the only places in Canada where you don't need this coverage are Labrador and Newfoundland. 

When you drive your vehicle off the lot, it begins to depreciate. If you're in an accident and your vehicle gets totalled, or your vehicle gets stolen, you don't want to have to worry about getting paid a lower value because of depreciation. 

Replacement cost prevents this from happening by making sure you get the original value of the vehicle instead of the depreciated value. This is great because it helps your company replace the vehicle without having to worry about incurring huge costs. 

• Type of commercial vehicles
• Number of vehicles
• How often vehicles are driven
• Your driving record
• Employees driving record
• Coverage and optional coverages chosen

If you're a savvy business owner, you know finding ways to save money without cutting corners is important. The same is true when it comes to your commercial auto insurance. 

There are a few ways you can save money here.

Driving Record

Maintain a clean driving record, and you can keep your costs low. Many companies have policies around employees who have an accident or moving violations for this reason. 

If even one driver has a history of violations, it can impact your premium. 

Get Multiple Quotes

Don't just go with the first insurance company you find. Spend time getting quotes and comparing the insurance companies and limits for coverage. 

Work with an Agent

When you are working with an agent, make sure they are experienced. They can help you ensure you have the right coverage and point you towards discounts. 

Bundle Your Coverage

Many insurance companies have deals for bundled coverage. You could bundle your commercial auto insurance with your business insurance or even your personal car insurance. 

Use Telematics

Do you and your employees already practice good driving habits? If so, using telematics can help you get a reduced rate on your policy. 

Telematics record information like how fast you drive, how far you drive, and how often you brake. This can get recorded through an app or a device plugged into your vehicle. 

If you're already practicing good driving habits, this is a great way to get a discounted rate. 

Prepay Your Annual Cost

Some companies offer discounts if you pay with a lump sum instead of monthly payments. This can take up to 15 percent off your premium. 

Consider Your Deductibles

If you're willing and able to pay a higher deductible, you can adjust your deductibles and get a lower rate. However, only utilize this method if you can afford the deductible when filing a claim.