Definition:
The Commercial auto Insurance will provide coverage for but not limited to, depending on the policy agreement:
Cover Provided by Commercial Auto Insurance
A. Liability
This cover the damages or harm that will occur when the business vehicle causes to another person or other peoples property.
B. Physical damage
This covers the cost of repairing or replacing a business's vehicle where an accident or total loss occur or other covered loss, such as theft or damage by act of vandalism.
C. Medical payments
This will cover the medical expenses for the driver (first party) and passengers (second party) of a business's vehicle in cases where accident occurs.
D. Uninsured/Underinsured motorist
This covers business in the event the business's vehicle is involved in a accident with another motorists who is at fault and does not have or have enough insurance cover to cater for the damages.
When insurance company are settling on which cover and how much a business is to pay on the policy premiums, they are majorly guided by factors. These factors help the insurance company to categorize your business and come up with the necessary figures.
These factors range widely as different company have different parameters to gauge on. However there are basic factors that will go into consideration. Some of these are:
Factors Considered when Categorizing Commercial Auto Insurance
1. Nature of business.
A delivery company with trucks and vans for delivery will require a different options cover than a consulting firms whose employees mostly use their personal cars.
2. Type of vehicle to be insured.
The types of vehicle will affect the cover to be offered. For example, a security firm dealing with armored vehicle require a totally different cover compared to a company engaging in farming business operations.
3. Number of vehicle to be insured.
A big business with huge fleet of vehicle require a different cover than that of a business with few fleet of vehicle to insure.
4. Potential risks.
These are potential risks that the business faces on its operation. Example a mining company require a totally different options compared to a company dealing with passenger transport or cargo delivery.
Important to note is that, specific coverage options and limits for commercial auto insurance will depend, but not limited to, on the above factors.
Finally, it's good idea for business to carefully consider their insurance needs and work closely with insurance professional to determine the right cover for the business niche. This will come in handy by ensuring that the business's vehicles are properly protected in the event of an accident or loss with the right policy. This will minimize financial impact to the company where a vehicle business-owned or used or operated is involved in a accident.
Also a comparison for different insurance companies options will help the business choose a insurance company that offers the best cover according to business needs.
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