New York Law Requirements For Commercial Auto Insurance
Commercial auto insurance is essential for any company that has vehicles on the road. In New York State, you cannot use your personal auto insurance to cover a commercial vehicle. The state requires a separate commercial policy for your vehicle if you use it for business, even if you already have personal coverage on it. In short, a commercial vehicle is any vehicle that is used to do business. We help our customers to make sure that they have the right coverage on their vehicles for any situation.
Commercial auto insurance is not separated by personal auto insurance by the mandatory minimums each requires. Commercial auto insurance requires the exact same minimum coverage that personal insurance requires, and those coverages in New York State include:
- $10,000 in property damage liability
- $25,000 in bodily injury for an individual
- $50,000 in bodily injury for two or more people
- $50,000 in death coverage for an individual
- $100,000 in death coverage for two or more people
What Does Commercial Insurance Cover?
The mandatory minimums for commercial insurance might be the same as for personal vehicles, but the premiums on commercial tend to be higher. Commercial insurance is required for vehicles such as:
- Construction vehicles
- Pick-up trucks used for work purposes
- Delivery vehicles (even pizza delivery vehicles)
- Any licensed vehicle that is used for work purposes
Commercial vehicles are at a higher risk for damage than personal vehicles, and that is why we always recommend getting coverage that is more than the mandatory minimums. Your work pick-up truck is usually outfitted with radio equipment and tool cases that you do not find on your personal vehicle, and that makes any incident with that work vehicle expensive. Work vehicles are also put in more dangerous situations than personal vehicles, which creates more risk. Your commercial auto insurance, when properly structured, will protect your company from any damage to your commercial vehicles, or any damage your vehicles cause.
What If I Don’t Get Commercial Insurance?
We work with construction companies of all sizes, and we find that many of our smaller clients tend to avoid getting commercial insurance on their personal pick-up trucks that they use for work. The moment you use a personal vehicle for any commercial purposes, your personal auto insurance ceases to cover you. Any damage that you cause or incur from an accident will be your personal financial responsibility.
More substantial than the property damage costs from an accident are the costs for bodily injuries. You will be personally responsible for all of the medical costs your passenger or anyone in the other vehicle incurs if you are deemed to be completely negligent. If you kill someone in an auto accident while using your personal car for business, then you would be responsible for paying any court awards to the family of the deceased.
Commercial auto insurance can sometimes seem like an inconvenience, but it is an absolute necessity for any construction company. Without commercial auto insurance, you could be only one car accident away from bankruptcy and closing your business for good.