Learn About Commercial Auto Insurance in Vermont & More
What is commercial auto insurance?
Personal auto insurance normally doesn’t cover commercial vehicles. For businesses in Vermont that have vehicles, there’s commercial auto insurance.
Commercial auto insurance provides coverage for commercially registered vehicles that businesses own. Coverage is available for most types of cars, vans, trucks and other vehicles.
What businesses in Vermont need business auto insurance?
Vermont state law generally requires that businesses with commercial vehicles get business auto insurance. Coverage beyond the minimum state requirements is highly recommended.
The state’s minimum coverage requirements are usually as follows:
- Bodily Injury Liability Protection at least $25,000/person and $50,000/accident
- Property Damage Liability of $10,000/accident
Many businesses opt for more extensive coverages and higher limits, due to the potential risks associated with driving vehicles. A single accident could easily exceed these minimums and potentially bankrupt a business.
What types of vehicles is business auto insurance used for?
Business auto insurance is available for virtually all types of vehicles that businesses use. Policies may cover cars, pickups, vans, straight trucks, larger trucks and fleets. They’re also readily available for specialized vehicles, such as limousines, hearses, ambulances, police cars and others.
It’s important to make sure a policy is designed to insure the type of vehicle that a business has, especially when insuring a specialized vehicle but also with all vehicles. A knowledgeable insurance agent who specializes in these policies will be able to find the correct type of policy.
What coverages get included in commercial auto policies?
In order to meet diverse coverage needs, policies make a variety of coverages available:
- Personal Injury Protection (PIP): In an accident, may protect against medical and other expenses for the occupants in your company’s vehicle.
- Bodily Injury Liability Coverage: In an accident, may protect against injuries caused to people outside your company’s vehicle (e.g. other vehicles’ driver and passengers).
- Collision Coverage: In an accident, may protect against damages to your company’s vehicle caused by a collision with another vehicle that’s being driven.
- Comprehensive Coverage: In a non-accident event (e.g. animal strike, falling tree, vandalism), may protect against damages to your company’s vehicle.
- Gap Coverage: In an accident where the vehicle is a total loss, may protect against the financial liability arising from the difference between a remaining loan balance (or lease) and the vehicle’s value.
- Property Damage Liability: In an accident, may protect against the cost of damage caused to another person’s property (e.g. another vehicle, building) by your company’s vehicle.
- Uninsured/Underinsured Motorist Coverage: In an accident with an uninsured driver, may protect against damages caused by the other driver.
What coverages are businesses that finance or lease vehicles required to carry?
In addition to meeting the state minimum requirements, businesses that finance or lease vehicles usually have to meet other coverage requirements that the lender stipulates.
Typically, the requirements include comprehensive, collision coverage and gap coverage.
These three protections generally protect against various events where a vehicle could be a total loss, thereby helping protect a lender’s financial interest in the leased/loaned vehicle.’
What is a hired and non-owned business auto policy?
When businesses rely on vehicles that they don’t actually own, hired and non-owned business auto insurance is often used. This often provides liability coverage in case an employee is in an accident while working.
For instance, multi-location businesses that have employees drive supplies between locations might get this coverage. So too might restaurants offering their own delivery services, but normally not when an online delivery service is used.
Hired and non-owned generally gives the business liability protection when the non-company vehicle is driven for work (commuting normally not included). It’s usually up to the employee to carry comprehensive, collision and any other non-liability coverages they want.
An insurance agent who specializes in business auto policies can assist with finding this particular type of policy, or any other commercial auto policy.
How can Vermont businesses obtain commercial auto insurance?
If your business needs commercial auto insurance in Vermont, reach out to the independent insurance agents at Lonergan & Thomas Insurance. Our team is ready to help ensure your company vehicles are properly insured.
