What Is Business Auto Insurance?
Business auto insurance — also called commercial auto insurance — covers vehicles used for business purposes. Personal auto policies specifically exclude coverage when a vehicle is used primarily for business, which means any vehicle your business owns, leases, or regularly uses for work needs to be covered under a commercial auto policy. The financial exposure of an uninsured commercial vehicle accident can be catastrophic for a small business.
GLS Insurance provides business auto insurance for companies across all 17 states in our service territory. From a single work truck for a sole-proprietor contractor to a fleet of delivery vans for a distribution company, we work with multiple commercial auto carriers to find the right coverage at the most competitive rate for your vehicles, drivers, and business use.
What Does Business Auto Insurance Cover?
Liability Coverage
Covers bodily injury and property damage you cause to others in a vehicle accident. Commercial auto liability limits are typically much higher than personal auto because the potential for damage in a business vehicle accident — particularly involving trucks, vans, or vehicles carrying cargo — can be substantial. Many commercial clients, property managers, and general contractors require minimum commercial auto liability limits as a condition of doing business.
Physical Damage Coverage
Covers damage to your own vehicles. Collision coverage pays for damage from an accident regardless of fault. Comprehensive coverage pays for theft, fire, vandalism, weather damage, and other non-collision events. Physical damage coverage is typically optional but essential for newer or financed vehicles.
Uninsured and Underinsured Motorist Coverage
Covers injuries to your employees and damage to your vehicles when the at-fault driver has no insurance or insufficient insurance. With significant populations of uninsured drivers in states like Florida, Texas, and Oklahoma, this coverage is particularly valuable.
Medical Payments / Personal Injury Protection
Covers medical expenses for your driver and passengers regardless of fault. Requirements vary by state — some states in our territory require PIP coverage; others do not.
Hired and Non-Owned Auto Coverage
Hired and non-owned auto coverage is a critical extension of business auto coverage that many businesses overlook. Hired auto covers vehicles you rent or borrow for business use. Non-owned auto covers vehicles not owned by your business that are used for business purposes — typically employee-owned or contractor-owned vehicles driven for work.
If your employees run business errands in their personal vehicles, drive clients to meetings, or make deliveries in their own cars, your business is potentially exposed when they have an accident. Non-owned auto coverage protects the business from claims that exceed the employee’s personal auto coverage. This is particularly relevant for nonprofits, churches, delivery businesses, and professional service firms.
Business Auto Insurance Across 17 States
Commercial auto insurance rates and requirements vary significantly across our 17-state territory. Florida is one of the most expensive commercial auto states in the country due to litigation environment and uninsured motorist rates. Texas and Illinois also tend toward higher commercial auto premiums. Iowa, Nebraska, and South Dakota generally have more favorable rate environments. Each state also has its own minimum liability requirements that your commercial auto policy must satisfy.
Business Auto Insurance FAQ
What is the difference between business auto insurance and personal auto insurance?
Business auto insurance covers vehicles owned by businesses or used for work-related purposes. Personal auto insurance is designed for everyday driving and generally excludes accidents that occur while a vehicle is being used for business, so relying on a personal policy while driving for work could leave your business exposed.
Does my business need commercial auto insurance if it only owns one vehicle?
Yes. Whether your business owns one vehicle or an entire fleet, any vehicle used primarily for business purposes generally needs a commercial auto policy. The number of vehicles does not change the type of risk your business faces, and most personal auto policies will not cover accidents that occur during business use. Requirements may vary by state.
What types of vehicles can be covered under a business auto policy?
A business auto policy can typically cover a wide range of vehicles, including cars, vans, pickup trucks, box trucks, and specialty vehicles like service vans or work trucks. Coverage options vary by insurer and vehicle type, so speaking with your agent is the best way to make sure each of your business vehicles has the right protection.
Does business auto insurance cover employees driving their own cars for work?
A standard business auto policy generally does not cover employees driving their own personal vehicles for work-related tasks. To help protect your business in those situations, you may need to add hired and non-owned auto liability coverage, which can help cover claims when an employee is in an accident while using a personal or rented vehicle for business purposes.
Business Auto Insurance FAQ
Does my personal auto policy cover my work truck if I use it for my business?
No. Personal auto policies contain exclusions for commercial use. If your vehicle is used primarily for business purposes — carrying tools, visiting clients, making deliveries — a personal auto policy will deny claims that arise during business use. You need a commercial auto policy.
What is the difference between business auto and fleet insurance?
Business auto and fleet insurance are closely related — fleet insurance typically refers to a commercial auto program covering five or more vehicles, often with fleet-specific discounts and risk management services like telematics. GLS Insurance provides both individual vehicle business auto and multi-vehicle fleet programs across all 17 states.
Do I need separate commercial auto policies in each state my drivers operate in?
Not necessarily. Commercial auto policies can be written to cover vehicles and drivers operating across multiple states. However, you must carry at minimum the statutory liability limits required in each state where your vehicles operate. GLS Insurance structures multi-state commercial auto programs to ensure compliance everywhere your drivers go.
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