Anyone who uses a vehicle—car or truck—for business purposes needs to have commercial auto insurance. It is legally required in all states. Commercial auto insurance premiums can be expensive. The best way to save money on commercial auto insurance is to shop around, as different companies can vary quite a bit in prices and coverage.
- Compare Quotes to Find Cheap Commercial Auto Insurance
- Tips to find cheaper commercial auto insurance
- How much does commercial auto insurance cost?
- What happens if you don’t have commercial auto insurance?
Compare Quotes to Find Cheap Commercial Auto Insurance
Comparing quotes from several providers is the only way to ensure that you are able to get the cheapest commercial auto insurance policy for your business. Here are a few companies that we recommend you starting with.
- CoverWallet: Best for comparing several quotes to find the cheapest one
- Progressive: Offering affordable commercial auto insurance rate thanks as the market leader
- Nationwide: Offer affordable commercial auto insurance with safety discount
- Farmers: Offering affordable commercial auto insurance for contractors and food trucks
- Geico: Offering affordable commercial auto insurance for rideshare drivers
CoverWallet: Best for comparing several quotes to find the cheapest one
When you start looking for cheap commercial auto insurance coverage, it is always a good idea to start with CoverWallet, a digital business insurance broker. CoverWallet allows you to compare several quotes from their partner companies in one place conveniently.
Their quote form is relatively simple, it shouldn’t take you more than 10 minutes to complete. Once you decide to buy a policy from CoverWallet, you can also use their digital dashboard to manage all of your business insurance policies. The dashboard also offers useful features such as downloading the certificate of insurance, renewing a policy, or filing a claim.
CoverWallet is a subsidiary of Aon, one of the largest business insurance brokerage firms in the world. They also earn a good customer rating (A) from BBB.
Progressive: Offering affordable commercial auto insurance rate thanks as the market leader
Progressive is the market leader in commercial auto insurance. They have the biggest market share with 12.1%, almost double marker share of the second biggest company, Travelers at 6.2%.
Progressive’s commercial auto policies include standard coverages for liability, collision and comprehensive, third party injury, personal injury, and uninsured and underinsured motorist coverage. They also have hired and non-owner coverage, and a rideshare policy. They’re available in all fifty states. They offer online quoting, but to actually buy a policy, you’ll have to contact an agent. According to their website, the average cost of commercial auto insurance is about $183 a month.
As the market leader in commercial auto insurance, Progressive should enjoy some economics of scale and is able to offer affordable rates. In additional, Progressive offers many discounts to help you save money
For this quote, we said we wanted to insure two vehicles in the state of Colorado, with two drivers, neither of whom had any moving violations in the past three years. We chose coverage limits of $300,000.
Nationwide: Offer affordable commercial auto insurance with safety discount
Nationwide commercial auto insurance offers all of the standard policies, plus add-on coverages such as roadside assistance, rental reimbursement, non-owner coverage, and more.
One discount from Nationwide is the Vantage 360 Fleet program. You can get 10% off your policy by allowing Nationwide to use a telematics tag on your vehicles. These monitor driver behavior, such as braking, adhering to speed limits, and use of a phone. Drivers can earn rewards for engaging in safe driving. It’s not available in every state, however.
Farmers: Offering affordable commercial auto insurance for contractors and food trucks
Farmers offer specialized coverage for contractors, who are most likely to need commercial auto insurance. They also offer specialized policies specifically for food trucks. The only thing is, they don’t offer online quoting: you’ll have to work through an agent. If you start an online quote, you’ll get this message:
They do insure all fifty states, however.
Geico: Offering affordable commercial auto insurance for rideshare drivers
If you drive for Uber or Lyft, you should look into Geico. Not only do they have reasonable rates in general, but they also offer rideshare insurance that you can use whether you’re driving for work or for personal reasons. They also offer some discounts.
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Tips to find cheaper commercial auto insurance
Below are a few tips that you can follow to find cheaper commercial auto insurance:
Government or state program offering discounts on commercial auto insurance:
If you use your car or truck for work (other than commuting back and forth) you’re going to need commercial auto insurance. Unfortunately, there aren’t really any government or state programs designed to save money on commercial auto insurance. There are a few for personal auto insurance, but even those are few and far between.
>>MORE: Why do You Need Commercial Auto Insurance?
>>MORE: Commercial Auto vs. Personal Auto Insurance: Why You Need to Know the Difference?
Hiring drivers with a good driving record:
Commercial auto insurance is more expensive than a personal auto insurance policy would be. For one thing, you probably have more than one driver, so the more drivers there are, the more risk. One thing you can do to save money on commercial auto insurance is make sure you hire safe drivers or those who have a good and clean driving record. They also need to hold a commercial driver’s license (CDL).
Driving inexpensive and safe cars:
Another thing that affects your costs is how old your vehicles are and what type they are. The more expensive the car or truck, the more expensive it is to insure. If you drive a commercial tractor trailer, you’re going to pay more than someone who uses their Toyota Camry to drive for Uber.
Increasing deductibles on your commercial auto insurance policy:
Consider raising your deductible to save some money. Just make sure you can cover the deductible if you or your drivers are in an at-fault accident.
Choosing minimum coverage
Another way to reduce your commercial auto insurance premiums is to choose minimum coverage requirements for your policy. Each state has its minimum coverage requirement for commercial auto insurance that you need to follow.
If you own the vehicles in your fleet, you don’t have to have collision/comprehensive insurance. However, if you get into an accident, you will have to shoulder the costs of the repairs.
Adding safety monitoring devices to your commercial vehicles
Some companies offer discounts if you agree to add safety monitoring devices for drivers. These apps track things like speed, hard braking, and whether or not the driver spends time on the phone. Some of these provide rewards for safe drivers, but even if they don’t, you could certainly reward drivers for safe driving habits.
Comparison shopping
The most effective way to save money is to shop around. Rates vary by state, by what type of business you have, driving record, etc. Some companies may offer better discounts than others. Once you have a commercial policy in place, you should shop for a new policy every three years or so: insurance companies know that no one likes shopping for auto insurance, so they offer attractive introductory rates and then raise them every year.
How much does commercial auto insurance cost?
On average, commercial auto insurance costs small businesses $150-250 a month.
It depends on what you do and how much you drive. It also depends on the drivers you employ and their records, what type of vehicles you use (make, model, weight, etc) and what state you live in. The more time you spend driving, the more likely you are to get into an accident. Commercial auto insurance is more expensive that your personal policy.
Be sure to shop around with a few companies or a digital broker like CoverWallet to compare several quotes to get the best and the cheapest one for you
>>MORE: How Much does Commercial Auto Insurance Cost by States?
What happens if you don’t have commercial auto insurance?
It may be tempting to roll the dice and use your personal auto insurance policy for business. However, this is a bad idea. Your personal auto insurance policy will not cover you if they find out you use your vehicle for work purposes. If they find out, they could drop you as a client altogether. When you go to shop around for a new policy, your rates will be significantly higher because you’ve been dumped from your previous policy. So just bite the bullet and get commercial auto insurance.
Last Thoughts
Commercial auto insurance may be expensive, but it’s a lot less expensive than paying for the medical bills and property damages if you’re in an accident. If you are a professional, you need to set a good example for your clients and employees, which means the appropriate kinds of insurance.
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