Skip to main content

11.0 Commercial Auto Coverage

Learning Objectives​

Upon completion of this chapter, you should be able to:

  1. Differentiate among the Commercial Auto coverage forms;
  2. Identify the coverages provided by the Business Auto Coverage Form and the Business Auto Physical Damage Coverage Form;
  3. Explain the importance of the Garage Coverage Form;
  4. Recognize when the Auto Dealers Coverage Form is used;
  5. Distinguish between the Truckers Coverage Form and the Motor Carrier Coverage Form for common and contract carriers; and
  6. Identify selected Commercial Auto endorsements.

Overview​

Personal Auto policies are not designed to cover many business-related auto exposures. For example, they generally exclude coverage for company cars, commercial fleet vehicles, public or livery conveyances, and autos while they are in the care of a mechanic. These exposures are instead addressed through Commercial Auto insurance. Several Commercial Auto coverage forms are available, depending on the needs and exposures of the business. These forms may be written as separate policies or included as the Commercial Auto Coverage Part of a Commercial Package Policy (CPP). Commercial Auto policies are subject to their own policy conditions, as well as the Common Policy Conditions discussed in Chapter 9. When Commercial Auto coverage is included in a CPP, it is also subject to the Common Policy Declarations and its own Commercial Auto Declarations page.

This chapter discusses the Commercial Auto coverage forms available to protect a business against liability arising from the commercial use of various types of autos. It also explains the physical damage coverage available for covered autos owned, leased, hired, or used by the business.

An Insurance Story

The Furniture Company owns vehicles used for deliveries and installation services. Because these vehicles are used in the company’s business operations, they are not eligible for coverage under a Personal Auto policy, even if they are private passenger-type autos. Although Personal Auto policies may allow limited incidental business use, The Furniture Company’s use of these vehicles is regular and commercial in nature. Therefore, coverage must be provided by Commercial Auto insurance.