Operating business vehicles might mean using a single company car. Or, it might mean using a fleet. These vehicles will have drivers, all whom both present and face risks behind the wheel. It's up to the business owner to make sure that all drivers have appropriate coverage under commercial auto insurance. How can you achieve this protection?
As a business owner, the burden of insuring your drivers usually falls on you. Keep in mind, however, often more than just drivers alone need coverage.
Understanding Commercial Auto Insurance
Commercial auto insurance protects a business's investment in the vehicles it operates. A business is different from a single driver. That's why standard policies generally don't cover commercial vehicles.
Among the most prominent differences is that more people become involved in commercial vehicle operation than drivers alone. Coverage will thus account for the different parties involved. That is because they all might have to have a degree of coverage under the policy. In other words, commercial coverage will protect the company and those within if problems occur. The operation itself will have a financial shield. So, in case of liability claims or vehicle losses, many parties usually have protection.
Think about it this way. In case of a liability claim against the business, more than just a driver might face a lawsuit. An injured party might choose to go after the business owner and other individuals. So, all these parties might need coverage from a commercial auto policy. But, how do you insure them?
Most commercial policies might insure three parties:
- The Business: Generally, the business owner is the policyholder. The business itself is also usually a named party on the policy.
- Permissive Users: These are those people who have permission to use your vehicle. Most often, these are your employee drivers. However, they might include other drivers in certain cases.
- Omnibus Users: This can be a tricky group to understand. It is generally a party that could be accountable for the actions of any of the named insured or permissive users. For example, if you use a contractor as a driver, coverage might need to extend to the contractor's actual employer.
Talk to your Quantum Alliance agent about exactly who will drive your business vehicles. Also tell them if you will ever drive the vehicle on personal rather than official business. Factors like these can help your agent determine the right coverage for all who might drive. Never let anyone operate your vehicle who does not have appropriate coverage.