Commercial auto insurance covers legal bills, medical expenses, and property damage if a business vehicle is involved in an accident.
Driving to and from worksites exposes small construction and contracting businesses to a high level of risk. A collision could lead to another motorist getting injured, or expensive repairs for your construction truck or van.
An auto accident could cost your small business thousands of dollars, especially if another person is injured. Compare that to the median annual premium of $1,990 for a general contractor, or $1,600 for a painter, and it’s easy to see why commercial auto insurance is the better deal.
Commercial auto insurance can help cover the cost of lawsuits, property damage, medical bills, and other expenses that arise from an accident. It also pays for vehicle damage caused by weather or vandalism, along with vehicle theft.
This policy can be tailored to fit the unique needs of a construction company or contractor. For example, a plumber's van that is rarely used may need less coverage than a painter’s car that is driven daily.
Company-owned vehicles must be covered by commercial auto insurance.
Commercial auto insurance may be required if you:
State regulations determine how much coverage you need. Your commercial auto insurance must meet your state’s liability insurance requirements.
If your masonry business or other construction company is sued over an auto accident, legal fees can get out of hand fast. You may also end up paying for a settlement or court-ordered judgment out-of-pocket if not insured.
If the driver of your business vehicle is injured, along with any passengers, this policy can cover the cost of medical care.
Collision coverage pays for damage to your construction truck or other work vehicle, no matter who is at fault.
Your coverage can help pay for damage caused by uninsured drivers.
A commercial auto insurance policy can pay for non-collision damages, including vandalism, theft, and fire.
Commercial auto insurance only covers business-owned vehicles, but sometimes employees drive their own cars for business errands. Personal auto policies almost always exclude coverage for business use. Hired and non-owned auto insurance offers liability coverage for construction professionals who get into an accident while driving their personal vehicle to conduct company business. It also covers leased or rented vehicles.
While commercial auto insurance is crucial for small businesses that depend on a car, van, or truck, it does not cover risks beyond those related to your vehicle. Owners of construction and contracting businesses should also consider:
General liability insurance: This policy can cover expenses related to client injury and property damage, such as a contractor sued for damaging a valuable antique in a client's home.
Workers’ compensation insurance: Required in almost every state for construction and contracting businesses that have employees, workers’ comp can cover medical fees for work-related injuries.
Contractor’s tools and equipment insurance: This policy helps pay for repair or replacement of a contractor’s equipment and tools if they are lost, stolen, or damaged.
Professional liability insurance: This policy covers professional mistakes and oversights, such as a contractor missing a deadline for a project.
Builder’s risk insurance: Builder’s risk insurance can pay for damage done to a structure still under construction, such as fire or vandalism at a construction site.