How Much Is Commercial Car Insurance?

By John Hewitt

  • Overview

    How Much Is Commercial Car Insurance?
    How Much Is Commercial Car Insurance?
    Commercial car insurance is mandatory for small and large businesses alike. Even if a car is already covered by personal insurance, if it is being used for commercial purposes, it must be covered by such a policy or the insurer will not pay off for accidents. Extremely heavy vehicles cost significantly more to insure than lighter passenger automobiles.
  • Function

    Luckily, commercial auto insurance is often sold at a bulk discount for business operators who own at least several similar vehicles. Trucking companies, for example, typically do not insure individual vehicles, but rather purchase a package called fleet insurance that provides coverage for all the vehicles run by the business. The calculations that go into determining how much commercial car insurance should actually cost are complex and differ significantly among states, vehicles and companies.
  • Considerations

    In addition, commercial car insurance rates are significantly by the drivers that are assigned to them. As commercial insurance policies are generally taken out on more expensive vehicles than in most personal insurance situations, the experience of the driver and HIS previous coverage record ends up affecting the cost of the insurance significantly more. Commercial car insurers offer their best rates to drivers over 30 and under 65 with significant commercial driving experience.


  • Effects

    The cost of commercial car insurance often eats significantly into profit margins. Many small business owners--some acting on erroneous and illegal advice--attempt to only cover their vehicles with personal insurance policies. Even automobiles that are used for personal purposes primarily must be covered by a commercial policy if the driver wants coverage for accidents incurred while the vehicle is being used for commerce.
  • Considerations

    Vehicles that are used for specific purposes such as farming equipment and construction are the least expensive to insure. Next are passenger vehicles and those used to make low-mass deliveries, such as pizza delivery cars. The most expensive to insure are heavy-duty cargo vehicles that carry loads of 10,000 pounds or more--these often require additional cargo insurance on top of the coverage for the vehicle itself.
  • Benefits

    Acquiring proper commercial auto insurance ensures the long term viability of any business that relies on vehicles. Insurance should just be considered a standard cost of doing business; if a business can't remain profitable while paying legally required insurance, then it most likely remain will no be in operation for very long. Luckily, many insurance companies offer special deals for businesses using experienced drivers, installing additional security features or negotiating with an insurance agent.

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