When you utilize a vehicle, to conduct business transactions, you need business auto insurance. Much different from the coverage options available for personal auto insurance, commercial or business auto insurance protects you when you are involved in an accident while driving for your business. Without business insurance, your insurance company may not repair or replace your vehicle after you sustain an accident while operating your vehicle in a business capacity.

Types of Losses to Your Company Car
For insurance purposes, there are two major types of accidents you encounter: at-fault and no-fault accidents. At-fault accidents are those in which you or your employee caused the accident, also known as a loss. No-fault accidents are those in which you were the victim of another’s negligence. 

You can also have a loss that does not stem from an accident, e.g. damage sustained to your car from hail damage or vandalism. Depending on the type of loss you incur, your insurance company will determine how much of your established limits are allocated to cover your loss.

Types of Coverage Options
The type of commercial insurance coverage your company should purchase depends on the needs of your business. Of course, the more insurance coverage you have, the more protected your business is when a loss is experienced. The following are the most popular options for insurance coverage:

•    Liability
•    Collision
•    Comprehensive

Some states impose laws that govern what type and amount of insurance coverage you must have for your company vehicle.

Liability Insurance 
Insurance coverage varies from state to state, but each state requires that business owners maintain the minimum established by the state. Liability insurance protects businesses from liability in the event of an at-fault accident. The basic coverage will help you cover the costs of repairing cars you damage. It will also replace your victim's car if the car was a total loss. Additionally, basic insurance coverage helps you cover the costs associated with personal injury and death. 

Collision Insurance
Collision insurance takes effect when you are involved in a no-fault accident. This insurance coverage helps you cover the costs of repairing and replacing your car if necessary, after an accident. Collision insurance will help repair your car even if you hit a tree, you do not have to hit a car in order to benefit from this type of insurance.

Comprehensive Insurance
With comprehensive insurance, you get protection from losses that are not an accident. For instance, if you experience damage to your car as a result of a tree falling on it during a storm, then your comprehensive coverage will help repair your car. 

Understanding your coverage options is the first step to protecting your business. With the right insurance in place, your business will not be completely responsible for repairing or replacing your company car after an accident, which keeps your business financially solvent.

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