If you own a vehicle on behalf of your business, then both you and your business need to be insured. This means investing in commercial auto insurance, designed specifically to cover vehicles used for business purposes.  

Business vehicles aren’t immune to accidents. However, when they do occur, they can cause a significant financial loss to the business as opposed to a single individual. A business should have a financial resource available within their commercial auto insurance to help them recover the costs brought on by the accident. That benefit is called collision coverage.  

When Does Collision Insurance Help Businesses? 
Collision insurance is part of your commercial auto policy’s physical damage coverage, it helps you make vehicle repairs from an accident.  

Essentially, if damage occurs to your vehicle while you are driving it, then collision coverage steps in. However, it doesn’t cover vehicles damaged by hazards like fires, severe weather, hail, flooding or vandalism. In these instances, comprehensive damage coverage applies. 

Do You Have Enough Coverage? 
You naturally want your collision coverage to pay as much as possible for your vehicle’s damage following an accident. You also may want to use it for a new vehicle in case your present vehicle is totaled. In either case, you might not be compensated based on 100% of the value of the expenses. 

• Deductibles apply to collision claims. If the cost of the damage is below the value of your policy deductible, your plan won’t even cover the cost of your claims. 

• If a commercial vehicle is deemed a total loss following a wreck, your commercial auto policy will likely pay you based on either a vehicle’s actual cash value or on its replacement cost value.

With commercial auto insurance, look at what coverage is best for your company to minimize any risk.