TL;DR: Many businesses face significant financial risks from vehicle-related incidents, making a flexible and comprehensive business auto policy (BAP) essential.
Blog Highlights:
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BAPs cover vehicle use for deliveries, transporting goods, or passenger services
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They’re customizable with liability, collision, towing, and rental car protection
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Coverage excludes intentional damage, pollution-related loss, and employee injury
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Can be bundled with property insurance for broader business protection
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Flexible options for rented or leased vehicles included
Many businesses face possible losses when they own, use, or maintain vehicles for their operations. Most coverage needs can be handled by a business auto policy (BAP) which covers operations such as:
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Product or food delivery
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Transporting business products to wholesalers or retailers
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Retail product delivery to consumers
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Carrying persons for short, intermediate or long-distance routes
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Picking up customer items for cleaning, repair, storage, etc.
In 2024, car crashes cost employers $72 billion. Vehicular crashes have an enormous impact on businesses, personal lives, and the wider economy.
Flexible auto insurance coverage for business needs
Auto insurance coverage for business is flexible. You can buy it as a separate policy or in a coverage package that protects buildings and business property (e.g. equipment and furniture). A business auto policy (BAP) generally offers:
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Liability Coverage–protection for physical injury to other persons or their property because of an accident related to your covered vehicle, including legal defense cost or expense.
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Comprehensive Coverage–handles loss from any cause except collision. A limited, less expensive option is available. It only protects against a set of specific causes such as fire, lightning, explosion, vandalism and several others
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Collision–takes care of damage from crashes with another object or overturn of the vehicle
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Towing And Labor Costs–handles expenses for moving disabled vehicles
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Loss of Use/Rental Vehicle Coverage–if you damage a rental car, this option helps to reimburse the rental company for income it loses because the vehicle is out of use. You may have limited coverage for injury or damage you cause to others while driving a rented vehicle anywhere in the world.
What a business auto insurance policy may not cover
Typically, a business auto insurance policy (or similar form) bars coverage for the following:
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Any injury/damage that you expected or intended
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Responsibility for damage you assume under a contract
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Losses that should be handled by a Workers Compensation, Disability Benefits or Unemployment Compensation Law
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Bodily Injury to an employee caused by a Fellow Employee
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Damage to property that is in your Care, Custody, and Control
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Any bodily injury or property damage that occurs because of Pollution
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Any loss that is related to racing, demolition or stunts
Reviewing your business auto policy coverage
Are you protected against business auto losses? Drive over and discuss your situation with an insurance professional. The trip will be worth it.
If you have questions about commercial auto insurance call us at 800-392-6532. Talk to an insurance expert today to find the right business auto policy coverage for your needs.
Frequently asked questions about business auto policies
Here’s some common questions:
What is a business auto policy?
A business auto policy (BAP) is a type of insurance that covers vehicles used for business operations, such as delivery vans, company cars, or service trucks.
What does a business auto policy cover?
Business auto policy coverage typically includes liability, comprehensive, collision, towing, and loss of use. Providers can customize it to fit your company’s specific vehicle needs.
Is auto insurance coverage for business different from personal auto insurance?
Yes. Auto insurance coverage for business includes protections not found in personal auto policies, such as liability for employees driving company vehicles and coverage for multiple types of commercial use.
Does a business auto insurance policy cover rented or leased vehicles?
Most business auto insurance policies offer optional coverage for rental or leased vehicles, including reimbursement for rental income lost due to vehicle damage.
What’s not covered under a business auto policy?
A business auto policy usually excludes intentional damage, contractual liabilities, workers’ compensation claims, pollution-related damage, and injuries caused by fellow employees.
This post is for informational purposes. The details and conditions of insurance policies vary. We always recommend speaking with an agent to understand the terms of your existing policies and the policies you plan to purchase.
To consult with an insurance advisor, call 800-392-6532 or email .
