auto insurance basics to choose the right policy

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Do You Need Auto Insurance for Your Small Business?

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Even if your business doesn't offer delivery service or involve a fleet of vehicles, going without business auto insurance can be an expensive mistake for business owners. By the time you learn you need coverage, it may be too late to avoid a hefty claim. What specific benefits can a business auto policy provide?

Who Needs Business Auto Coverage?

Any business that ever asks an employee to use their personal vehicle for a task that's within their general scope of employment could be liable for any damages or physical injuries the employee sustains (or causes) while on this excursion. This "scope of employment" category covers everything from short runs to the post office to a random bakery trip to pick up donuts for a morning meeting. Because even a minor-seeming fender-bender can cause thousands of dollars worth of vehicle damage, while an accident involving airbag deployment can generate thousands in medical bills, "saving" money by going without auto insurance can be a costly mistake for any business. Even if your employee has their own auto insurance policy, if their insurer knows that they were performing a business-related errand, not a personal one, the company may decline coverage for any accident that occurred on the clock. And last thing any business owner wants is to get into a protracted legal battle with an employee's insurance company. 

What Should You Consider When Looking for Coverage?

There are a few things to keep in mind when deciding what policy and coverage limits make sense for your business.  First, you'll want to check out your state's minimum coverage limits. For individual drivers, these coverage limits represent the bare minimum amount of protection one must have to maintain a valid driver's license. If you're pulled over and don't have adequate business insurance coverage, you may have your driver's license suspended. While business policies aren't subject to the same mandatory minimums (since this coverage isn't mandatory, just highly recommended), it's still important to keep these minimums in mind and ensure that the policy you select exceeds these coverage levels. 

You'll also want to consider additional coverage options, such as medical payments (direct payments to individuals injured in an accident) or uninsured/underinsured motorist coverage (coverage for your employee if they're struck by an uninsured motorist). Purchasing business auto insurance coverage cannot only protect your employees, but it can also provide you with much-deserved peace of mind, even in the most turbulent business environments.