The House Insurance Built
Risk Management for Builders & Contractors

Chapter 2: Understanding Construction & Contracting Insurance Policies
Part 3.1: Essential Insurance Coverages: Commercial Auto Insurance

If you drive an automobile to transport workers, equipment, and supplies to and from jobsites, you'll want Commercial Auto Insurance. The cost of a single auto collision could cost you your business if you are sued for damages.

And no matter the extent of the damage, wrecks are never cheap. According to AAA's "Crashes vs. Congestion: What's the Cost to Society?" report, traffic crashes cost U.S. motorists almost $300 billion per year.

Depending on your specialty, your on-the-road risks are even higher due to the transport of oversized machinery and equipment. Driving down rural roads also increases the risk of collision and upset losses because of the narrow and uneven ground. But the good news is that you can safeguard your contracting business — no matter your trade — with a quality Commercial Auto policy.

Your insurance policy can include…

  • Bodily injury liability coverage. If you are legally responsible for an accident that injured people other than your passengers, your policy can cover the cost of the claim. This may include legal defense fees and settlements or judgments if you (as business owner) or your company is sued.
  • Property damage liability coverage. Your policy could pay for a third party's property damage caused by your company's vehicle.
  • Collision coverage. Commercial Auto Insurance can cover repairs to your commercial vehicle if you strike or are struck by another vehicle.
  • Comprehensive coverage. Some policies can also include coverage for other kinds of damage that happen to your vehicle (e.g., a branch falling on your windshield, vandalism, or theft).
  • Medical expenses. Some policies can include care expenses when you and passengers in your vehicle are injured in an accident.

Not all policies are the same, but these points can give you an idea about some of the coverage options available. Also, keep in mind that each state carries different requirements for Commercial Auto Insurance. To learn what your state has on the books, check out's Commercial Auto Insurance Minimum Requirements page and click on your state.

Next: Inland Marine Insurance

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