Reasons to Compare Before Purchasing Commercial Car Insurance

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Key takeaways...
  • Comparing car insurance quotes will help you to find the best rate for the coverage you need
  • There are several different policy options for you to choose from
  • Gather information about the insurance companies you’re considering to make sure they’re financially stable and offer the customer service you desire

If you own a business in which vehicles are used, you will need to purchase commercial car insurance. You should always compare a number of insurance providers before you buy a policy.

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There are many reasons for this, as you want to make sure that you are choosing a reputable company and that it can serve your business needs smoothly and efficiently. It may take a little more of your energy and time, but it is worth it in the end.

Commercial car insurance can often be more confusing than personal car insurance, especially if you have multiple vehicles or are transporting things across state lines.

Make sure you do your own research about what you need, as well as consult the insurance companies. Choosing the right company is important and you should take the time to compare at least three companies, if not more.

Price

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Because most businesses are always looking at the bottom line and trying to save money, looking for affordable commercial car insurance is often a priority. This is one of the reasons you should compare multiple companies.

Price is important, but you should know that it is not the only factor in purchasing insurance.

The insurance business is competitive because there are so many companies that offer services and products. Because of this, you will often be able to find affordable rates if you compare enough companies. There are a number of ways you can find and compare companies.

The Internet makes it very easy and convenient to compare multiple quotes from different insurance providers.

The quickest way is to visit a third-party quote site that offers instant free quotes for car insurance. This is especially true if you have a small business with only one vehicle and driver.

You only have to fill in the required information once and you will get quotes from the companies that can help you.

If your commercial needs are more complicated, you may need to compare each company separately by speaking to an agent on the phone or visiting an office in your neighborhood.

This is true if you have a fleet of vehicles, have multiple drivers who will be on the policy, have employees who will be using their own cars for business purposes, or have different types of trucks or vans that you need to insure.

Keep in mind that a lot of things go into a rate quote. These things include:

  • Type of vehicles you are insuring
  • Driving history of employees
  • Location of your business

Although comparing different companies can help you find a competitive price, it still may not be cheap if you have higher risks involved.

Different Policies Offered

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Another reason to compare commercial car insurance companies is that not all of them offer the same types of policies. Some may also be more experienced with one type of coverage as opposed to another.

The insurance that you get for your commercial vehicles may seem similar to personal insurance, but it can be very different. You may be insuring one car that you drive both for personal and business use, or you may have multiple vans or trucks, or a fleet of vehicles.

You need to make sure you are getting the right coverage for your particular situation.

The types of coverage that you can get commercially that are similar to your personal policy include the following:

  • Liability for both property damage and bodily injury
  • Comprehensive
  • Medical payments or PIP
  • Collision
  • Uninsured or underinsured motorist

In many cases, the limits for your liability coverage will be higher than for your personal vehicle.

Because there are so many different types of businesses, the types of coverage for business vehicles can vary greatly. Besides the basic types of coverage, some commercial auto insurance providers offer additional kinds of coverage.

If you own a business for which employees will be driving their own vehicles for errands or deliveries, you should strongly consider getting coverage for non-owned vehicles.

Even if your employees have their own personal auto coverage, it usually does not cover them for work-related travel.

They also may not have enough coverage for damages. Having non-owned vehicle insurance will cover anyone who is driving a vehicle that is not owned by the business.

If you are the sole owner and employee of a business and you use your vehicle for both personal and business use, you should add an endorsement to your policy for an individual named insured.

Some companies will add this for no extra cost, so compare each company’s guidelines. This endorsement will also help cover you if you ever need to drive a vehicle that is not yours, including leasing, renting, test driving, or borrowing a vehicle.

Insurance for other vehicles such as plows, trucks, semis, etc, can vary a lot from regular autos. Check with each company you are comparing to see if one will fit your particular insurance needs better than another. Some companies also exclude certain vehicles from coverage.

If you have additional questions about commercial policies and what you should look for, use the Insurance Information Institute as a resource. It also offers additional information about other business insurance needs.

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Financial Stability

How the commercial car insurance companies stack up financially is a huge reason to compare multiple providers. There are companies, such as A.M. Best and Standard and Poor’s, that analyze insurance companies in regards to their finances.

You can find out how much each company has in assets, which can help determine their ability to pay claims. You will also see a letter rating for each company.

Strive to choose a company that has at least an “A-” for a grade, although an “A” to “A++” would be ideal. Also, choose a company that has a stable and strong future outlook.

Quality of the Company

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Choosing a company that is of high quality is another reason to compare insurance companies.

First of all, make sure that the companies you are considering are licensed to sell insurance in the state where you live.

This information can be found through your state insurance department, which you can locate through this map from the National Association of Insurance Commissioner’s website.

There have been stories of insurance companies that have not been registered in certain states and have taken advantage of policyholders. They have collected premiums but then weren’t able to do anything when claims arose.

Doing your research will prevent this from happening to you.

You can also contact your local Better Business Bureau. If there have been any grievances made against the company, there is a good chance you will find them on the BBB’s website.

Personal Service

You should also compare commercial auto insurance companies in terms of personal and customer service. It may come down to what you personally prefer. Although some commercial insurance providers have offices in your local area, some deal mostly online.

Decide whether you prefer to meet with an agent face to face when you have a claim or questions about your policy, or if you are okay with phone calls or Internet interaction.

You can also compare commercial coverage providers in terms of customer service. This may be found through the Better Business Bureau.

Ask around with other business owners that you know and trust. Ask who they use for their commercial auto needs and how they feel their experience has been.

This may be a starting point for you to find an insurance provider rather than using the Internet.

Because commercial auto insurance is often more complicated than personal insurance, you want to make sure you choose a company that is readily available with any questions or concerns you have.

Many companies have 24-hour access, either via phone or the Internet. It should also be easy and quick to get a hold of a representative.

Switching Companies

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If you currently have a commercial car insurance policy and are unhappy with the company you have it through, it is a good idea to search around for a different provider. There is no point in paying money for a policy that is not serving your needs.

If you aren’t satisfied with the claims process, the customer service provided, or another issue, it is worth your time to find someone else.

Use the guidelines stated above to find and compare companies. Once you find one that you feel will fit you better, you can switch to them. The important thing to keep in mind is to keep your current policy in place until you have another one.

Just as it is with personal car insurance, any sort of gap in your policy is bad, even if it is only for a day or two. Don’t worry about paying extra premiums, as you will receive a refund from your last insurance provider for the overlap in coverage time.

It is easy to start your comparison of car insurance rates right here by placing your local ZIP code into the available FREE quote tool!

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