COMMERCIAL VEHICLE INSURANCE

Commercial auto coverage extends beyond vehicles with a company logo. How a vehicle is owned, used, and operated determines how it must be insured. The wrong policy form — or the wrong limits — can create significant exposure.

• Business Auto Policy (BAP) - A Business Auto Policy (BAP) provides liability and physical damage coverage for vehicles used in business operations.

  Liability Coverage: Liability coverage protects the business if a driver causes bodily injury or property damage to others. At Seed Insurance Group, we typically structure commercial auto policies with a $1,000,000 Combined Single Limit (CSL). While lower limits may be available, they are often insufficient in today’s claim environment. Auto losses can escalate quickly, and appropriate limits are critical to protecting the business and its long-term stability.

• Physical Damage Coverage: Physical damage coverage protects the insured vehicle itself and generally includes:

  • Collision – Damage resulting from an accident

  • Comprehensive – Non-collision losses such as theft, vandalism, weather, or animal strikes

  Deductibles apply and should be selected based on risk tolerance and financial capacity.

• Hired & Non-Owned Auto (HNOA) Even if your business does not own vehicles, you may still have auto liability exposure.

  • Hired Auto Coverage applies to vehicles your business rents, leases, or borrows for business purposes.

  • Non-Owned Auto Coverage applies when employees use their personal vehicles for business activities — such as running errands, making deliveries, or traveling to job sites.HNOA coverage typically provides liability protection for the business. It does not replace an employee’s personal auto policy and does not provide physical damage coverage for their vehicle.

  In some cases, limited hired and non-owned auto liability coverage may be included within a Commercial General Liability policy when no separate commercial auto policy is in place. However, availability, scope, and limits vary by carrier and policy form. Businesses should not assume this coverage applies without confirming the specific policy language.

• Garage CoverageGarage coverage is designed for businesses that sell, service, repair, or store vehicles. It can provide:

  • Liability protection

  • Physical damage coverage for customer vehicles in your care, custody, and control

  A standard Business Auto Policy does not properly cover vehicle-related businesses.

• Trucker & Motor Carrier CoverageBusinesses that transport goods or passengers require specialized auto coverage.

  • Trucker’s Coverage applies to businesses that haul goods for others, including for-hire or long-haul operations. Additional regulatory filings and endorsements may be required.

    Motor Carrier Coverage applies to businesses that transport people or property for compensation, such as taxis, shuttle services, or bus companies. These operations often require higher liability limits and specific state or federal filings.

• Driver & Usage Considerations: Commercial auto underwriting is heavily influenced by:

  • The type of vehicle

  • How the vehicle is used

  • Where it operates

  • Who is driving it

  All drivers must be disclosed to the carrier. Driving history — including accidents, violations, and license status — directly affects eligibility and pricing. Strong hiring practices and driver oversight are critical components of managing auto risk. Personal auto policies generally do not provide adequate protection for business use.

  Why This Matters: Auto claims are among the most frequent and severe losses businesses face. A serious accident can exceed minimum liability limits quickly and create long-term financial consequences. Proper structuring of liability limits, physical damage coverage, hired and non-owned exposures, and driver management is essential to protecting your business. Commercial auto insurance is not just about insuring vehicles — it is about protecting the operation behind them.

Each policy will have stipulations, limits, and exclusions. Extensions, riders, and floaters are available to fill any gaps. The information on this website is an overview of the types of insurance you may be able to purchase, but does not comprise full explanations of policy types nor does it guarantee any particular coverage or policy.