Last updated: November 25th, 2022
Reviewed by
Paige Geisler
Licensed Insurance Agent
Not only is it often required by law, but it’s also essential to protect employees, vehicles, products, and the course of business. How much does commercial auto insurance cost, what does it cover, and what do companies need to know before investing in protection for their assets? Find out answers to these questions below.
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The cost of commercial auto insurance can vary greatly between plans and providers. While the average policy per vehicle costs around $145 per month, business owners purchasing plans should keep in mind that costs are highly dependent on individual circumstances. Some businesses may see cheaper rates, while others may find themselves paying significantly more on a monthly basis. Businesses in different sectors will have varying rates due to the risks their specific services or products present. It’s helpful to check across a variety of insurance providers before deciding on a policy to ensure you’re getting the best price and coverage to help protect your company.
The insurance industry isn’t a simple sector to understand. All companies differ in what types of insurance plans they offer. Plans need to be examined in detail with the assistance of an agent to make sure you’re getting the coverage that will most benefit your business. Some plans offer limited coverage, while others are more comprehensive. Which plan is right for a particular company will depend on industry, specific business use of commercial vehicles, and other elements. In general, however, companies that lease assets or want to make sure protection is as thorough as possible will require comprehensive policies to protect their own interests.
A standard commercial auto insurance policy covers physical damage to a vehicle as well as liability, which includes things such as injury, property damage, glass damage, animal damage, theft, and protection for uninsured or underinsured motorists. Plans can also include things such as rental vehicle coverage, towing, and uninsured or underinsured driver protections.
In most cases, companies can opt to add more comprehensive insurance to base plans, providing expanded access to items such as payments for medical bills, vehicle damage from collisions, or higher property and bodily injury claim limits. It’s important to pick the types that are most relevant to you, so it’s unwise to skimp on coverage for cost-saving purposes.
How much a small business pays for commercial auto coverage will depend on several things. This means policies will vary significantly from one company to another. As established above, most companies pay around $140 per car per month. This means that a company with 10 commercial vehicles might pay around $1,400 per month, while one with 50 may pay $7,000. For companies that use costlier vehicles, such as trucks for long-haul transportation, the cost could be in the tens to hundreds of thousands of dollars a month. A custom quote is a critical part of the insurance purchase process. Without an accurate quote, it’s easy to overestimate your potential budget and end up struggling to pay your premiums and other costs associated with conducting your business.
The cost of a commercial auto policy can be influenced by many factors, including:
How these apply can vary as well, so speaking to an insurance professional is key to understanding how a company’s operations play into potential auto policy expenses. More cars, more drivers, bigger vehicles, and high-value cargo can result in higher costs. On the other hand, occasional drivers, such as when a motor pool is in use, can mean very affordable monthly payments.
Yes, the industry in question can play a significant role in the cost of a commercial auto policy. For example, a government agency that provides company cars to its white-collar employees will likely pay far less in commercial auto insurance than a trucking company that operates a wide logistical network. In this case, the number of vehicles covered, the kind of vehicle coverage, the potential damage costs in the case of a crash, and the products being transported can all factor into the cost of your commercial auto policy.
Yes, it’s possible to combine commercial auto insurance with other types of business insurance. This can include general liability and commercial property insurance. In some cases, this can reduce overall expenses, particularly when working with insurance companies that offer discounts for insurance bundling. If an insurance company doesn’t provide information on bundling upfront, you can ask as part of the quote process.
Commercial auto insurance is a critical part of asset protection for companies that require corporate transportation resources. There’s an insurance policy for every business, whether you have company cars issued to employees, work vehicles, food trucks, or trucks used for product transport. Be sure to work toward comprehensive coverage for all necessary costs. Examine all your options from collision coverage to medical coverage in the case of bodily injury through accidents. With the right level of coverage, it’s easy to protect you and your business from the unexpected.
Brian is the founder and CEO of Insurist and carries Life, Health, and Property & Casualty licenses in all 50 U.S. states. Since 2013, Brian has been a member of Million Dollar Round Table, a designation for the top 1% of financial advisors worldwide. Brian has been featured in Yahoo! Finance, Money.com, Entrepreneur.com, Life Happens, Forbes, MSN, and Good Financial Cents. Brian’s goal is to show customers the best products, the quickest answers to their questions, and provide expert advice.
Paige is an assistant agent for State Farm and is licensed to sell property and casualty, health, and life insurance in Virginia. She handles all different types of insurance and financial services and is currently working on a securities and bonds license. Paige has a degree from Radford University in English and is a certified notary.
