Have you been using your personal car for making sales visits, visiting sites, or any other commercial purpose?
Well, you’re pretty exposed to the risk of getting your insurance claim denied in case of an accident.
In Canada, you need to insure both personal and commercial vehicles as per the provincial requirements.
However, using your personal vehicle commercially increases your risk profile, prompting insurers to deny claims.
Getting car insurance for a business vehicle is imperative if you use it primarily for business purposes.
Most enterprises work closely with established insurance brokers while choosing these policies.
Visit this site for customized quotes from some of the top insurers in Canada to cover your commercial vehicle.
What Is Commercial Vehicle Insurance?
Commercial or business car insurance comes under specialty car insurance. Reputed insurers design these policies to secure vehicles you drive for commercial purposes.
A plethora of businesses largely depends on mobility to scale up their ventures. All sorts of businesses in Canada use some vehicles dedicatedly for commercial purposes.
Whether you own a large fleet or a few cars to run errands, make sure to get proper insurance for a business car.
If you insure a few cars, you can simply purchase commercial car insurance. On the other hand, reputed insurers also offer affordable fleet insurance policies to cover dozens of vehicles.
Both these types of insurance policies are registered under the name of the business or the owner.
The coverage for a commercial car insurance policy is designed to mitigate the financial vulnerability of your business in case of accidents or mishaps.
Commercial car insurance is necessary to cover the following types of vehicles.
- Pick up and drop off cars
- Delivery cars
- Road tractors
- Dump trucks
- Pick-up trucks
- Trailers to transport equipment
How Does A Commercial Auto Insurance Policy Help?
Business owners find commercial auto insurance policies valuable under the following circumstances.
- If your employed drivers, any of the passengers, or you sustain an injury following an accident while travelling in your business vehicle, the policy would cover the lost wages and hospitalization costs.
- Car insurance for a business vehicle would compensate you for the cost of renting a temporary vehicle after your dedicated vehicle meets an accident. Businesses can even replace the damaged car if it is rendered unusable.
- As you scale your fleet up, the new vehicles come under the blanket coverage of the existing commercial car insurance policy.
Evidently, commercial car insurance policies financially secure your business with an additional defense layer. Commercial vehicles are vital for your operations.
What happens if any of your vehicles meet an accident, get stolen, or one of your drivers sustains an injury during an accident?
With adequate commercial insurance coverage, businesses can prevent these disruptions from interrupting their operations.
Who Needs Commercial Vehicle Insurance?
Now, you might be wondering whether or not you should get commercial vehicle insurance. Let’s find out who actually benefits from these types of policies.
1.) Use Of Your Car
Businesses use commercial vehicles for specific purposes, such as transporting tools, merchandise, or employees.
The risk profile of a commercial vehicle is, therefore, different from that of personal cars.
Again, you might be using a vehicle for business purposes occasionally. If your operations don’t include deliveries or transporting staff, you may not go for a commercial vehicle insurance policy.
You can simply ride to your workplace from your home and return using the car covered under your personal car insurance policy.
Now, if you regularly use the car to deliver goods, transport merchandise, or visit clients, make sure to get a commercial car insurance policy.
Businesses should get commercial vehicle insurance if they use cars for these purposes.
- Carrying personal emergency equipment
- Carrying maintenance staff
- Carrying contractors or employees
- Providing any kind of delivery service
- Making sales or site visits
- Using the car to carry employees
- Providing car-hire-style services
2.) Type Of The Vehicle
If you own a large commercial vehicle like a heavy truck, its risk profile would be much higher than your personal car.
The cost of repairing and replacing these vehicles is also high. In case of an accident, these vehicles can incur as well as inflict heavy damage.
Therefore, you need commercial auto insurance policies to cover these vehicles.
The same applies when using commercial cars to pick up or drop off your employees.
In case of an accident, the insurer would have to compensate for the lost wages and medical expenses of several people.
This increases the vehicle’s risk profile, which explains why you should get a commercial car insurance policy.
3.) Vehicle Owner
Do you own the car, or does the car belong to your employer or business? In the first case, a personal car insurance policy would do.
However, you would need a commercial vehicle insurance policy if it belongs to the business or its director or owner.
What Does Commercial Auto Insurance Cover?
Just like personal car insurance policies, car insurance for a business vehicle has some mandatory and optional coverages. Among the mandatory coverages, you have:
Liability coverage: If your company’s car is involved in an accident resulting in someone’s injury or death, or property damage, this coverage will compensate for the lawsuit and damage costs.
The law requires businesses to carry a minimum coverage for third-party liability, which varies as per the province you operate in.
Accident benefits: In case you or any of the passengers in a commercial vehicle sustain an injury as a result of an accident, the policy compensates you for the rehabilitation cost, medical expenses, and income replacement. Regardless of the party at fault, you can claim these benefits.
Loss or damage: Loss or damage includes some coverages that protect you from accidental and direct loss of the car or its equipment.
Among the optional coverages, you have a comprehensive policy, collision coverage, specified, and all perils coverage.
Often, commercial vehicles turn out to be highly specialized and large. Even a single collision can inflict a lot of damage.
The parts might also be expensive to replace or fix. Also, normal-sized commercial cars involve high insurance costs since these vehicles remain exposed to traffic during rush hours.
As a business owner, you would be looking for an affordable policy to cover your vehicles.