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Lower Business Car Insurance Premiums

Lower business car insurance premiums are the goal of most all business owners. Yet for many of us, it seems as if there is little or nothing we can do about the prices we pay for auto insurance climbing higher and higher year after year. Auto insurers and agents provide different reasons for the rate increases, but one thing is clear: as a business owner, it is tough to hold down the cost of an auto insurance policy. These days, most companies are doing everything they possibly can to save on their expenditures because income and profit margins are down across many industries.

In spite of what many business owners may think, it is possible to lower the rates you pay for business auto insurance. There are many different areas you can focus on to save some money and create wiggle room financially for your company. This article is a brief guide highlighting a few easy ways to save money on auto coverage and increase cash flow for your business. Read through our guide and you will likely find at least one tip you haven't thought of that can save you some money as a business owner.

Business Car Insurance Explained

Business car insurance (also known as commercial auto insurance) is a special type of policy reserved for the protection of vehicles that are used for work purposes in one way or another. Large trucks that deliver merchandise to vendors, as well as smaller vehicles that transport materials and workers to job sites, need this kind of protection to be safeguarded against the risk of loss. People who own their own company need a business car insurance policy for any vehicle they use for work, regardless of what kind of vehicle it is. Some people have the misconception that a vehicle titled in their name is exempt from needing this kind of protection, and that a personal policy is sufficient.

But the reality is that the need for this special coverage actually has very little to do with the type or the size of the vehicle, or even the title owner of the vehicle. If you have a small compact car titled in your name, you might think it is fine to insure it with a personal auto policy. In fact, this is quite a natural conclusion to come to. But if you own a business and you use that car for business purposes, you need to insure it for commercial use. Here's an example to illustrate why.

If a business owner is driving his sedan to different retail stores to sell his wares, even if he is not actually delivering them that day but only filling orders for them, he is completing commerce with that vehicle. The fact that the sedan is being used for business purposes means that it needs to be quoted for and insured with a commercial auto policy. If as a business owner you get into an accident on the way to one of these retail stores and your insurance provider finds out where you were headed at the time of the accident, they may not only deny the loss claim, but also invalidate coverage and cancel the policy, meaning any premiums you've paid would be forfeited for nothing.

Learn Your State's Insurance Laws

Commercial or business auto insurance protects covered policy holders from uncompensated losses due to accidents, thefts, and other covered events. Different states may have different rules governing the definition of commercial vehicle usage. And different auto insurance companies within a state may have different standards regarding examples of when personal policies are acceptable and when they are insufficient to protect the policy holder. It is critically important for any entrepreneur to find out the specifics of state laws as well as the rules of coverage providers so that there is no chance of claims denial or cancellation following a loss claim.

There are some vehicle uses that are a no brainer as far as this special coverage is concerned. But if you feel like you've come across a gray area and you don't really know what is required, find out for sure. Do not leave your policy protection to chance. A good example of this is with company employees who either volunteer or are compelled to use their vehicles for deliveries or other work usage. There are ways you can be protected by the company's auto insurance policy, including non owned vehicle coverage. It is within your rights to inquire what kind of auto insurance protection exists before you agree to drive your own car at work.

Business owners can save by only hiring drivers with solid driving records, getting multi policy discounts, and opting for fleet self insurance options in some cases. Explore all options to maximize savings.


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