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What Are the Examples of Commercial Auto?

Having a commercial auto is a great way to increase your income. However, there are some things that you need to know about it before you sign the contract.

Property Damage

Buying property damage insurance is an essential part of any business owner’s overall insurance portfolio. Property damage is not only limited to the damage done to a business’s property, but also includes damage to the business vehicle, business contents, and personal property.

For example, a construction company’s truck is involved in a severe accident while carrying lumber. The damages incurred include physical damage, loss of income, and legal fees. The business owner may pay out of pocket if the insurance company does not provide the claim.

Commercial auto insurance, for example, commercial auto Woodbridge VA policy, will typically offer physical damage coverage. This is an essential feature for business owners who use their vehicles for business purposes. In addition, insurance companies may offer more comprehensive coverage to reduce the risk of paying out of pocket.

Bodily Injury

Almost every state in the United States requires drivers to carry bodily injury liability insurance. This type of insurance provides coverage for injuries to another driver or passenger. It pays for medical bills, lost wages, and legal defense.

Some states require drivers to carry more than the minimum bodily injury liability coverage. For example, a driver with a vehicle must have at least $15,000 of coverage per person in California. This will cover a maximum of $25,000 in medical bills, legal fees, and lost wages.

In addition to bodily injury liability, most states require a combination of property damage liability insurance, which will pay for damages to other people’s property. It is often a good idea to carry an umbrella policy for this type of coverage, which will extend your policy’s maximum limits.

Uninsured/Underinsured Motorists

Purchasing Uninsured/Underinsured Motorists coverage is essential to your auto insurance policy. It can help you pay for damages to your vehicle and passengers, regardless of who caused the accident. If you are ever involved in an accident, talk with your insurance agent to learn about the available options.

Whether you have a personal or business vehicle, your insurance agent can help you determine the appropriate coverage for your situation. The exact limits will be used for uninsured motorist coverage as liability insurance. But there are discounts available for specific ranges. If you are a business owner, consider additional coverage for injured employees.

Some states require that drivers carry minimum liability insurance coverage. This amount is often insufficient for most accidents, so underinsured motorist coverage can help you cover the gap. It can also cover medical expenses for you and your passengers.

Temporary Substitute Auto

Almost all personal auto policies limit coverage to replacement vehicles that the driver does not own. This can result in proof problems when the driver of a borrowed car is involved in a crash.

A typical example is a borrowed car being rear-ended while on the road. The car owner’s insurance company paid for the damage. A claim was filed against the insurance company. It argued that the vehicle was a “temporary substitute auto” (T.S.A.) and not a real car. The claim was deemed not to be merited by the facts.

Louisiana enacted a law called C.S.H.B. 3420 to address these issues. The law was designed to make it easier for consumers to determine if a vehicle is a temporary substitute or a real car. The law does not apply to vehicles owned by employers.

Underwriting Process

Traditionally, commercial auto underwriting has relied on manual processes that can result in costly mistakes. However, intelligent automation can reduce costs and improve underwriting quality.

Fully automated systems can reduce the time it takes to process an application by as much as 85%. This decreases operational expenses and allows insurers to scale up underwriting volumes. This will enable insurers to compete effectively in a crowded market. It also allows insurers to win new business.

Automated document processing reduces human error, increasing underwriting quality. In addition, Instabase enables insurers to process more applications with the same team members.

A fully automated system can also give insurers insights into intelligent business decisions. The faster processing times give insurers a competitive advantage in a crowded marketplace. This can lead to timely quotes.