If you conduct business using a vehicle, you’ll need commercial auto insurance. Out of all of the business insurance policies on the market in Texas, commercial auto insurance is the only mandatory policy. This is because to drive any vehicle legally in Texas requires a minimum amount of liability coverage.
It can be easy to think of this insurance as an expense, but businesses stand to lose a lot in the event of an accident. Commercial auto insurance is an investment in protecting your company’s finances and safeguarding against damage to important assets including vehicles and your employees.
The rising costs of materials, medical expenses, and legal fees are enough incentive to protect your business with a commercial auto insurance policy. There are liability issues every business owner may face and have the right policies helps you avoid paying for losses out of pocket. Vehicle-related incidents can add up quickly, and businesses should consider the ramifications of an accident for a number of parties including shareholders, employees, clients, and the general public.
Breaking down commercial auto insurance can also become more complicated than one might think. The definition of a business owner and business use continues to evolve with the rise of the Internet. A common mistake is to only consider giant fleets for commercial auto insurance, however, small businesses, contractors, and even employees may require a policy to avoid coverage gaps. Learn more about powerful coverage options businesses have to protect against losses involving commercial vehicles.
Best Commercial Auto Insurance for Texas Businesses
Determining the best commercial auto insurance for your company will come down to a variety of factors. Some of these variables are controlled by you, the business owner, while others are out of your control completely. Because of these differences and the fact that each business’s needs will also vary, different insurance brands work better for different companies.
Even within the same industry, what works for “Company A” might not be the best option for “Company B”. The goal for every company is the same, which is to receive the best coverage for their auto protection at the lowest price possible. This is why sifting through different insurance brands is always recommended.
By partnering with 25+ A-rated or better insurance providers, we can comparison shop your coverage among trusted coverage options. This allows you the best possible outcome for your insurance needs, saving time and money in the process.
Commercial Auto Insurance Cost
Calculating your company’s commercial auto insurance cost boils down to identifying how your rate is created. There are many different factors that go into your quote including the amount of coverage you need, the location of your business, what you are transporting, etc. On top of all of this, each insurance brand will also use its own unique algorithms and methodologies to assess risks and create your rate.
Because there are so many moving pieces, it can be difficult to pinpoint an exact number for commercial auto insurance in the state of Texas. Your rate will vary from your partners, competitors, and even other businesses that are outside of your industry. A general rule of thumb is that companies that pose less of a risk to a company, however, will enjoy lower rates, whereas riskier businesses will pay more. In order to find the best rate for your coverage, it is always recommended that business owners compare their coverage among a variety of insurance providers.
When Is Commercial Auto Insurance Required?
You’ll need commercial auto insurance for any activity that involves driving a vehicle and conducting business. Here are some common examples:
- Driving a commercial van or truck to deliver a shipment of goods.
- Contractors driving a vehicle on the way to a job.
- 18-wheelers and hot shot drivers transporting goods.
These common examples are just a few of the activities when business owners should consider a commercial auto insurance policy. There are additional scenarios, however, that may be commonly overlooked by owners and employees alike:
- Salesmen or Realtors driving around with/to clients.
- Self-employed contract workers on their way to/in the middle of a job.
- Experience hosts, drop shippers, and other e-commerce centric business owners.
It doesn’t matter the size of your business, only the activity. If you are using a vehicle for business, you will need a commercial policy. Failure to enroll could have you paying sizeable expenses to restore the loss of another party as well as your own losses in the aftermath of an accident.
Cheap Commercial Auto Insurance in Texas
Protecting your business doesn’t have to destroy your profit margins. An auto accident without insurance is exposing everything you’ve worked for in your business to a litany of unwanted expenses. Finding cheap commercial auto insurance can feel like an impossible, time-consuming task, but it doesn’t have to with Freedom Insurance Group.
Our team of agents is prepared to do the heavy lifting for you and find the right coverages for your business at the lowest price on the market. By partnering with esteemed, A-rated insurance providers, we are able to offer a range of impressive commercial auto insurance products that protect your financial interests for less. Our customers save an average of 40% when switching. For an accurate estimate, get your free commercial auto insurance quote with only a few clicks of a button, or, contact us today!
Commercial Auto Insurance Coverages
Insurance is rarely if ever blanket coverage. Specific insurance products are built to protect against certain perils. For example, if you are in an accident that is your fault, liability coverage will help you restore losses to another party, but you’ll still be responsible for your own damages. Collision coverage, on the other hand, is there to help you restore the losses to your property. Liability may cover some if not all of the medical costs associated with another party after a wreck, but you’ll need additional coverages such as personal injury protection (PIP) or medical payments coverage to pay for your own. What happens if an uninsured motorist hits you? In the world of insurance, there are many scenarios, which is why business owners are provided a range of products. Get to know your coverage options better below:
The most important component of any commercial auto policy is the liability coverages it provides your company. These protections help restore another party’s losses including property damage and physical injuries. To operate in nearly any state, including Texas, you’ll need to have a minimum amount of liability coverage:
- Bodily Injury Coverage protects you from paying for costs associated with physical injury after an accident. Common covered expenses include medical and rehabilitation costs, funeral expenses, lost wages, and other damages.
- Physical Damage Coverage is what helps you restore the damage to another party’s property such as their vehicle.
Your commercial auto insurance policy will come with limits to your liability coverages, and any damages that exceed these limits will need to be paid for out of pocket by your company. Companies that insure multiple vehicles may also need to include the same liability limits across all vehicles. In Texas, businesses are required to retain the following minimum liability coverage amounts for their commercial vehicles:
- $30,000 per person with up to $60,000 per accident in bodily injury coverage.
- $25,000 per accident for physical damage coverage.
Your policy may not contain a higher amount of physical damage coverage than bodily injury coverage. Commercial trucks operate under a separate set of minimum coverage requirements, which can be found below under “Commercial Truck Insurance”.
A comprehensive policy is auto insurance protection for the random things in life that may cause harm to your vehicle outside of an accident. For example, if your company’s van is destroyed in a fire or damaged due to vandalism. You’ll need to pay a deductible out of pocket before receiving reimbursement for your losses.
Collision coverage policies cover your company’s vehicles for physical damage after an accident with another vehicle, another object, and/or overturning. Businesses will need to first purchase comprehensive coverage or fire and theft with combined additional coverage (CAC). As with comprehensive coverage, you’ll need to pay a deductible before receiving reimbursement after a claim.
Underinsured/Uninsured Motorist Coverage
Your company vehicle is in an accident with a motorist and the other party is at fault. They don’t have insurance or enough insurance, so now your business must restore the loss by cutting into profits. Underinsured and uninsured motorist coverage is protection against such scenarios that can help you restore your losses without hurting your business.
Personal Injury Protection (PIP)/Medical Payments Coverage
When employees and passengers are injured, there can be severe costs associated. PIP and medical payments coverage are protection that helps pay for medical expenses after an accident regardless of who is at fault. PIP and medical payments coverage will only kick in after medical insurance.
Rental Reimbursement Coverage
It helps your business cover rental costs after an accident. Policy limits will apply.
Roadside Assistance and Expanded Towing Coverage
Roadside assistance is there for you when your company vehicle is suffering a minor breakdown while on the road. An expanded towing policy picks up where roadside assistance leaves off and can include towing your vehicle and minor roadside repairs.
When vehicles are totaled or stolen and businesses owe more than the worth of the vehicle, this can create a serious problem. Your company will still need to pay off the loan and now it will be tasked with purchasing yet another vehicle to conduct operations. Gap insurance coverage helps your company pay the difference of what you owe off without being stuck with a lingering bill for a loan that no longer benefits your business.
Additional Coverage Options
While some coverages are more common than others, the needs of your business are unique. Freedom Insurance Group works with a range of trusted, top-rated insurance brands that also provide a wide range of commercial auto insurance policies. Here are a few additional coverages that may suit your company’s needs:
- Fire and Theft With CAC is a much more limited version of comprehensive coverage that will protect your company’s vehicles against specific perils such as fire damage, theft, windstorms, and flooding. This is a great option for companies looking to cut costs but remains protected.
- Non-Owned Car Insurance is liability protection involving accidents that occur while an employee is using their vehicle for your company’s operations.
- Hired Auto Coverage is liability coverage for when your company’s employees are driving a vehicle that is being rented or loaned for a job.
No matter how you need to be protected, we’re here for you. Our agents take the time to create a personalized approach to your coverage and will provide the right products for the lowest price to protect your company. Speak with one of our agents about your company’s specific operations and we’ll devise the right insurance policies to meet those needs.
Commercial Truck Insurance
While owning any commercial vehicle will spark a need for commercial auto insurance, truck owners have unique, specific challenges to overcome. It’s unlikely you’ll be asked to carry hazardous materials from Midland, Texas, to Houston, Texas, in a sprinter van, but for 18-wheelers, this run is just another Tuesday.
Commercial truck drivers in Texas are required to carry a minimum amount of coverage to remain legal, but your liability coverage requirements will vary depending on weight, and potentially other factors:
- Trucks weighing under 26,000 pounds or less hauling household goods only will require a minimum of $300,000 in liability coverage.
- Trucks weighing more than 26,000 pounds hauling household goods only will require a minimum of $500,000 in liability coverage.
- The Federal Motor Carrier Safety Administration (FMCSA) requires all trucks carrying 10,001 or more pounds of ordinary household goods to carry a minimum of $750,000 in liability coverage.
We understand that truck drivers require specific forms of protection and that your business is still looking to gain such protections for the lowest price possible. Cut costs but not coverages by understanding which policies and endorsements protect your business operations. Take a closer look at some of the most common commercial truck insurance coverages on the market for business owners:
|Commercial Truck Insurance Coverage||Description|
|General Liability||Protects your company from liability when another party suffers a loss while your truck is in the area. A general liability policy will protect your business from a range of issues including potential legal perils.|
|Non-Trucking Liability||Liability coverage for your truck when it is being used for non-business activities.|
|Physical Damage||If your truck is damaged due to a peril, a physical damage policy will help you restore your loss by reimbursing you the cost of repairing your vehicle.|
|Trailer Interchange||A trailer interchange policy is a physical damage policy, only it covers a trailer and/or container your truck is hauling but isn’t owned by your company.|
|Bobtail Insurance||Coverage for when your company’s truck is in an accident while not carrying a trailer. For protection, your truck may also not be in use at the time of the accident.|
|Rental Reimbursement With Downtime||If your truck is involved in an accident and is unable to operate, a rental reimbursement with downtime endorsement can help you cover costs including rental fees and making truck payments. Most policies have a time limit on the amount of coverage you may receive. Reimbursement is usually capped at 30 days.|
|Reefer Breakdown||Protects refrigerated trucks and their cargo from various perils including breakdowns and damaged goods. Some products may be excluded from coverage.|
|Pollution Liability Insurance||Transporting hazardous materials can come with a healthy payday, but it also adds a ton of risk for your company. Pollution liability insurance, also known as environmental insurance, can help you reduce your business’s liability in the event of a pollution leak while transporting materials that might not otherwise be covered by insurance.|
There are additional endorsements that may be available depending on your needs and the insurance brand you are covered by. Trailers may also be covered by your general liability or require additional protection depending on usage and weight. Be sure to speak with your insurance agent to best understand your needs and how your policy protects you.
Commercial Auto Insurance FAQs
Here at Freedom Insurance Group, we love helping business owners stay prepared with the right coverage options. When it comes to commercial auto insurance, however, some topics come up more than others. Of course, nothing can replace speaking with a licensed expert, but these frequently asked questions (FAQs) come along more than others. Use these answers as a guide for your business, and remember, we are happy to be a resource for any of your insurance needs. Feel free to contact us at any time.
The amount you pay for commercial auto insurance in Texas will vary. This is because no two businesses are the same and rates can differ due to a number of variables including how much coverage you need, where your business is located, and so on. Speaking with a licensed insurance agent who can help you navigate policies for your business in a fraction of the time is what we recommend for anyone seeking a policy. Ask an agent which coverage is right for you for an accurate look at how much your business will spend on commercial auto insurance.
Yes, in the state of Texas it is illegal to operate a vehicle without auto insurance. This includes commercial vehicles that are not covered by personal policies, but instead require commercial auto insurance policies to avoid coverage gaps.
In most circumstances, your commercial auto insurance will cover personal use, though some activities may be limited. Family members are not covered, however, by commercial policies.
Yes, in most cases, a commercial auto insurance policy is tax-deductible. Depending on your use, your policy may be fully or partially deductible from your taxes. Speak with your CPA to best understand how to deduct your insurance policy accurately.
Commercial auto insurance is protection just like your personal auto insurance policy, only for commercially used vehicles. Your policy will protect you against physical damage losses and liability issues including legal expenses and medical expenses after an accident. This could be involving a fleet of 18-wheelers hauling cargo across the country, a self-employed contract worker heading to a job, or anything in between. If you’re conducting business with a vehicle, you’ll need commercial auto insurance to stay protected.
In Texas, the average commercial truck insurance policy can range between $10,000 and $15,000 per year. This includes physical damage, liability coverage, and cargo protection. A minimum of $750,000 in protection is recommended as labor, materials, legal expenses, and medical costs continue to rise. The actual cost of your commercial truck policy will vary due to a number of factors, and determining your coverage expenses is done best by speaking with a licensed insurance agent.