Commercial auto insurance policies are designed to provide a wide variety of coverages for any vehicle that a business utilizes, including cars, vans, and trucks. Most policies cover physical damage, (including property damage and bodily injury) collision coverage, and coverage for medical payments. If your company borrows any vehicles for routine business operations, these will likely be covered by a commercial auto insurance policy. However, you should confirm with your insurer that this is the case, as some policies may carry certain restrictions.
Factors Affecting Commercial Auto Insurance Cost
According to the cost estimation website howmuch.net, average costs for business auto insurance generally fall between $900 and $1,200. (I haven’t seen prices this low in 3 years, I would not post this at all. However, the exact premium you ultimately pay depends on several factors. Here is a close look at four of these notable factors.
Number Of Vehicles Owned By Business
One of the primary factors that determine how much you pay in commercial auto insurance premiums is the total number of vehicles your company owns. If your fleet size is 10 vehicles, your commercial auto insurance costs will likely be substantially lower than if your organization owned 25 or more automobiles.
Value Of The Fleet
In addition to the number of vehicles your business owns, the value of your fleet will also affect your commercial auto insurance costs. This is largely determined by the types of automobiles your company uses for daily business operations. If your organization owns elegant vehicles such as limousines and black cars, the value of your fleet will likely be higher than that of a company that uses regular passenger cars or commercial vans.
Much like a personal automobile, the value of a commercial vehicle is typically determined by factors such as overall condition, (i.e. wear and tear) mileage, and any special equipment or features that may have been added to it. If the vehicle’s engine or other major components have been rebuilt, this may also likely impact its final value.
How Often Vehicles Are Driven
The more frequently your company’s vehicles are driven, the higher the probability of one of your automobiles becoming involved in an accident will be. If most of your vehicles are driven every day to conduct routine business operations, your commercial auto insurance costs will likely be substantially high. This is especially true if your organization is located in an area where there is often heavy traffic, such as in a large city.
Potential Industry Risks
Some industries carry more risks than others because of the types of activities their workers engage in. For example, any company that delivers goods (food and beverages, flowers, Amazon.com packages, etc.) may face risks if one of its drivers rushes to complete delivery on time. The driver may speed and become involved in a collision with another motorist or an object (a tree, streetlamp, building, etc.).
Similarly, a limousine company faces risk because its drivers may potentially become involved in accidents that result in injuries to themselves or to passengers who are clients, and/or physical damage to one or more vehicles or commercial properties.
It is important to note that commercial auto insurance premiums also often vary by state. According to the comparative price website ValuePenguin, the three cheapest states for full-coverage auto insurance are Maine ($1,268 per year), Hawaii ($1,340 per year), and North Carolina ($1,434 per year). Meanwhile, the three most expensive states for full-coverage car insurance are Michigan ($8,723 annually), Rhode Island ($3,847), and Louisiana (3,525). A vehicle’s year, make, and model can also all impact the cost to insure it. Net premiums earned in the commercial auto industry have been steadily increasing since 2011, according to Statista.
Protect Your Fleet With Commercial Auto Insurance
Reach out to the professionals at Southern States Insurance in Alpharetta, Georgia for more information on commercial auto insurance and how it may benefit your business. Since our founding in 1992, we have grown to become one of the largest privately-held independent insurance agencies in the Southeastern U.S. We work with several major insurance carriers and are dedicated to helping our clients find optimal value in their insurance plans.
If your company owns and uses multiple vehicles for daily business operations, then it will likely benefit from purchasing commercial auto insurance. Our policies include auto liability coverage, collision coverage, medical payments coverage, and comprehensive coverage (i.e. damage caused by events such as fires and natural disasters). We can cover a wide variety of vehicles, including taxis, commercial vans, ambulances, and different types of trucks. Call Southern States Insurance today at (888) 971-6304 or contact us online to request a quote or to learn more about our insurance products.