MONDAY, MARCH 15, 2021
 Businesses that own commercial vehicles must have commercial auto insurance. Any loss to these vehicles will therefore be a financial loss to the business. Still, business owners cannot avoid the fact that their vehicles are not immune to damage risks of any sort, not least vehicle wrecks. It’s imperative, therefore, for the company’s commercial auto insurance policy to include appropriate damage insurance, and one of its components is collision coverage.
Collision insurance is an important component of numerous commercial auto insurance plans, so let’s take a closer look at this benefit, and how it can assist you in case of a vehicle accident.
When Does Collision Insurance Help Businesses?
Collision insurance comes as part of your commercial auto policy’s physical damage coverage. It is designed specifically for the purpose of helping you make vehicle repairs when you strike another object while driving. It might apply in several situations:
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Your business truck backs into a wall, creating damage to the rear of the vehicle. Your driver simply did not see the wall.
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Your driver is unable to stop in an accident on a roadway. He or she strikes another car. Collision insurance covers damage to your vehicle. Your liability insurance covers damage to another party’s vehicle.
Essentially, if damage occurs to your vehicle while you are driving it, then collision coverage will be able to step in. However, it does not cover vehicles when they are damaged by hazards like fires, severe weather, hail, flooding or vandalism. In this situation, separate physical damage benefits called comprehensive damage coverage will apply.
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 want to use it to pay for a new vehicle in case your present vehicle is totaled by an accident. In either case, you might not be compensated based on 100% of the value of the expenses.
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Deductibles will apply to collision claims. If the cost of your damage falls below the value of your policy deductible, then your plan won’t even cover the cost of your claims.
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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 (its used value at the time of the wreck) or based on replacement cost value (the value of a like-new car).
With commercial auto insurance, it is important to have very specific coverage to meet your needs. Take a closer look at what coverage is best for your company. Work with your agent to get a specific level of protection in place to minimize any risk.
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