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February 2, 2020

Commercial Auto Insurance 101


Contact: Amanda Edmunds

I & E Insurance Agency



[email protected]

What is Commercial Auto Insurance?

Commercial auto insurance provides coverage for cars, trucks, vans, and other vehicles used by your business. Each commercial auto insurance policy has three basic parts – physical damage insurance, liability insurance, and other coverage.

What Is Covered by Commercial Auto Insurance?

Commercial auto insurance includes different coverages based on these three key parts of each policy. These coverages include collision insurance, comprehensive insurance, liability insurance. uninsured motorist coverage, and underinsured motorist coverage.
Collision insurance pays for damage to your vehicle as the result of hitting or being hit by another vehicle regardless of who is at fault. If your vehicle is financed or leased, collision coverage may be required. Comprehensive insurance pays for damage done to your vehicle created by other causes like theft, flood, vandalism, earthquakes, fire, or damage from a bird or animal.
Liability insurance covers bodily injury to others and property damage to another vehicle in the event that you are at fault in an accident. This insurance pays the lost wages and medical costs of others while simultaneously covering your legal expenses. Uninsured motorist coverage pays for your injuries or property damage is you’re hit by an uninsured or unidentified driver.
Underinsured motorist coverage protects you if you get into an accident and the at-fault driver does not have enough liability insurance to cover all of your bills. This does not apply if you live in a no-fault state.
Outside of these basic auto insurance components, there are dozens of options and add-ons that you can customize your business auto policy with:

  • Roadside assistance
  • New vehicle replacement cost coverage
  • Hired auto physical damage with loss of use coverage
  • Auto loan or lease coverage
  • Expanded towing
  • Rental reimbursement
  • Medical payments or personal injury protection coverage

Who Needs Commercial Auto Insurance?

Your regular commute is covered by standard car insurance, so you don’t need a commercial auto policy if you use your personal car to drive to and from work. However, if you use your vehicle to transport people, goods, or equipment for work, you need commercial auto insurance. Additionally, all vehicles owned by a company need commercial auto insurance. You also need a commercial auto insurance policy if your vehicle weighs 10,000 pounds or more or has a load capacity of over 2,000.

Without commercial auto insurance, you risk having limited or no coverage in the event of an auto accident in a commercial vehicle. You may have to pay out of pocket for any repairs or injuries you incur as well. Lastly, without a commercial policy, you risk losing your personal auto insurance coverage.

Looking for a commercial auto insurance policy? The team at I & E Insurance can provide you with information regarding commercial auto insurance policies based on your needs and budget!


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