Commercial Auto Insurance: What to Ask Before Buying

Hoffman Hanono
May 19, 2023

If you deploy vehicles throughout doing business, having commercial auto insurance is vital. If your company isn’t covered, you run the risk of substantial financial losses in the event of a lawsuit. Still, when you take the time to consider your business’s needs carefully, you’ll be able to get the right commercial auto insurance for your company for a fair price.

With that being said, here’s what to ask before buying commercial auto insurance:

How Many Vehicles Need to Be Insured?

Asking yourself how many vehicles need to be insured is arguably one of the most important things to consider before buying commercial auto insurance. If you need to insure several vehicles, you may be able to save money on each premium with “fleet insurance” from a single insurance provider.

The number of vehicles it takes to be deemed a fleet depends on the insurer, but often, as few as three vehicles can be considered a fleet.

What Kinds of Vehicles Need to Be Insured?

The class of vehicles your business uses is another vital factor to consider when purchasing commercial auto insurance. For example, if your company’s vehicles are typical passenger vehicles, insuring them is simple and usually based on a flat rate.

If you use tractors, trucks, and trailers, the insurance process becomes a bit more complex. This is because the policy you’ll need for these particular vehicles will be determined by the gross vehicle weight (GVW).

How are the Vehicles Used?

Insurance companies base their premiums on risk levels, so it should come as no surprise that how often your vehicles are used and the conditions in which you use them can impact your rates.

Suppose your work vehicles are used for low-risk activities (like the occasional product delivery). In that case, your premium will probably be lower, but if your fleet includes heavy-duty vehicles that haul cargo in dangerous conditions, your premium will be much higher.

How Many Employees Need to Be Insured?

Different commercial auto insurance policies have different terms, so ensure that the policy covers all employees using the vehicles before they drive off. For example, some insurers may require you to list every employee permitted to drive your company vehicles.

What are Your Policy Limits?

No one likes to think of their work vehicles being involved in accidents, but before you finalize your policy selection, ask about your policy limits. Commercial auto policies typically have two separate limits:

  • Occurrence Limit: The maximum amount that can be paid for a single claim
  • Aggregate Limit: The maximum amount that can be paid across all claims

An experienced insurance agent can review your business needs and offer suggestions.

Choose the Right Insurance with Hoffman Hanono

The world of insurance can be tricky, but at Hoffman Hanono, we’re dedicated to helping you find the right insurance for your business. We’ve been helping business owners like you find the right insurance since 1959, so if you’re unsure what to ask before buying commercial auto insurance, we can certainly help. Contact us today for a free quote!