Business vehicle insurance is required in almost every state. Most business owners are required to have some type of liability coverage for bodily injury, property damage and medical expenses if they or their employees drive a company vehicle. Some states also require uninsured/underinsured motorists coverage and medical payments coverage (also known as personal injury protection).
How insurance companies calculate commercial vehicle insurance cost
The exact cost of commercial vehicle insurance for your business is determined by several factors, including:
1. The type of business driving you do
Professions that drive more for work — even if it’s your personal vehicle for business use — such as real estate agents, will usually spend more on business vehicle insurance than, say, an accountant or other office worker who drives less.
If your work involves driving to job sites on other people’s property, such as a cleaner or janitor, you usually face more risk and may likely have higher insurance premiums.
How often you drive and how many miles you drive can also factor into your business vehicle insurance cost.
2. The number of vehicles you have
If you own a cleaning company with two cars, a van and a truck that you use for business, your business car insurance cost will likely be more than if you have only one car.
3. The types of vehicles you drive
Cars, trucks or vans may have different rates in your state. And the make, model and year of your vehicle can also influence your commercial auto insurance coverage.
4. The location of your business
If you’re a small business owner in Miami you may pay more for business vehicle liability insurance than if you worked in a small town in Minnesota.
More populated areas often have higher property prices, more crime — and therefore, more risk.
5. Your insurance claims history
Your record of losses and claims can have an impact on your business vehicle insurance price.
For example, if your employees have backed over a few too many mailboxes, you may see an increase in your premium at renewal time.
6. Your driving record
The number of years you’ve driven without an incident can impact your commercial auto insurance policy rates.
Note: It’s important to provide the most accurate information about your business when you get a quote for business vehicle insurance. This can help make sure you get the coverage that’s right for you and help process claims without delays.
The best way to learn exactly what you’ll pay for your monthly or annual cost is to get a free commercial auto insurance quote with our partners online. It’s no obligation, and it takes about 10 minutes to see your exact price.
3 tips to help reduce the cost of Commercial Auto insurance
You can take several steps to lower or prevent a higher deductible on your small business vehicle insurance, including:
1. Choose the right insurance policy limits and deductibles
Higher coverage limits on your commercial car insurance policy can offer more protection. But higher limits will almost always increase the cost of your policy.
While lower limits will save you money on your coverage options, if you set your limits too low you could leave yourself vulnerable to more financial loss after a covered event.
2. Keep your risk level low
A reliable vehicle and solid driving skills can help make you a safer driver. It can also limit the need to file insurance claims which could raise your insurance cost.
If your small business relies on driving for work, do all that you can to ensure safety along the road. For example, you might:
- Train your employees on safe driving techniques.
- Invest in reliable work vehicles.
- Conduct regular vehicle maintenance and safety inspections.
3. Learn from previous claims
Analyze your previous claims to learn what you could have done to avoid those risks.
For instance, if you filed an insurance claim for a trailer that was unhitched on the way to a work site, train your employees on proper procedure to hitch a trailer to a truck.**
