If you operate as a tradie, your tools, equipment, and your vehicles are vital to your success. Consider how much you depend on these and how difficult it would be to keep your business going if one or more were out of commission. You carry business insurance to protect yourself, but it may not be enough.
In this article you will learn all there is to know about commercial motor vehicle insurance including why it is important for your business.
If you have motor vehicles that are owned and operated by your business, you most likely need to have commercial motor insurance. This type of insurance cover is vital because, without it, all motor vehicles used in conducting your business are at risk.
What is Commercial Motor Insurance?
A commercial motor insurance policy protects vehicles used in the operation of your company. The policy also covers third parties who sustain loss because of an unintentional event caused by you or one of your employees while operating a company vehicle. A good commercial motor policy will get your vehicle back in service as fast as possible and compensate third party losses.
Why Do I Need Commercial Motor Insurance?
A commercial motor policy will cover the vast majority of vehicles that are your responsibility. An ordinary personal auto policy covers vehicles used for personal travels and commuting to work.
You could face expensive consequences without the right insurance cover.
Myles owns a restaurant that also caters to small events on the side. He often uses his van to deliver food to the events. On his way to make a delivery, Myles gets into an accident that damages his van and a car. When Myles makes a claim with his insurance company, he receives the unpleasant news that his insurance will not pay for the damages to either vehicle because he was using a personal vehicle for a work event.
If Myles had consulted with an insurance professional, he would have heard that his cover would not apply to vehicles used for business. However, this is an expensive mistake that also leaves Myles on the hook for his repairs and the other parties’ repairs.
What is Considered a Commercial Vehicle?
A commercial vehicle is defined as any vehicle you use to carry out the various activities essential to your business.
What Kinds of Vehicles Will Commercial Motor Insurance Cover?
Commercial motor insurance covers a great many types of vehicles. This includes but is not limited to,
- Four Wheel Drive
- Mini Loader (stand or walk behind)
- Pet Grooming Trailer (towed)
- Ride-on Mower
- Trailer Mounted Generator
- Trailers (up to two-tonne capacity)
- Woodchipper (towed)
If you are not sure about cover for the vehicles you own, be sure to speak with an insurance professional. Having less insurance cover than you believe can lead to costly problems.
Are There Any Kinds of Vehicles Commercial Motor Insurance Will Not Cover?
Several vehicles are generally not eligible for cover under a standard commercial motor insurance policy. These include,
- Firefighting Vehicles
- Grey Imports
- Mining Machinery
- Mobile Cranes
- Rescue Vehicles
- Security Company Cars
- Taxis and Former Taxis
- Underground Vehicles
- Vehicles Hauling Asbestos
What are the Commercial Vehicle Insurance Policy Options Available to Me?
There are three options for commercial coverage. These are,
- Legal Liability Coverage – The most inexpensive of all the policies, a legal liability policy will cover damage to another person’s vehicles and property where you or one of your employees is deemed to be at fault. However, should your property sustain damage, you are responsible for covering the cost of repairs or replacements.
- Fire, Theft, and Legal Liability Coverage – The fire, theft, and legal liability policy is a mid-priced type of commercial vehicle insurance. It is widely considered a step up from the liability policy. This policy will provide the same cover as a legal liability policy. However, you also benefit from the added fire and theft coverage. You will receive compensation if you sustain a loss due to theft or fire with this type of policy. Many business owners opt for this type of added protection. The same limits apply if you are at fault in an accident. You would need to pay for damages to your vehicle.
- Comprehensive Coverage – Often called the gold standard of commercial motor insurance, comprehensive coverage compensates you as well as the other party involved in a loss. While the comprehensive cover is the most expensive of the three commercial motor insurance options, it also offers you the highest level of protection.
Whether you are a one-person operation, a subbie, or a tradie with a large staff, All Trades Cover can help you nail down the right commercial motor insurance for your business. If you would like to know more or have questions, get in touch with us. We are here to help.
The material presented in this blog post is for informational use only. It should not be used to take the place of one-on-one consultation with an insurance professional.