For a long time, business auto insurance was just a small part of bigger commercial insurance packages. It was bundled with things like general liability and workers’ compensation, mostly flying under the radar. But that’s changing. Insurers are starting to separate auto coverage from those packages, moving it into specialty markets because losses have been getting worse.
This shift is changing how underwriters look at business auto risks and making it harder for customers to find affordable standalone policies. Joe Krieg, assistant vice president at Amwins Brokerage in Chicago, explains that many standard insurers never planned to focus on auto insurance. They added it because they already had other coverage for the business. Once they checked the numbers, they saw auto policies were causing big losses and pulling down their books.
This has led to many insurers dropping just the auto part of policies. Companies with mixed vehicle fleets or special risks are being pushed toward the wholesale market. That means insurance brokers are seeing a rush of new business and trying to find enough coverage in the specialty space. Krieg notes there’s limited capacity for business auto outside the standard packages, so wholesalers are crucial because they connect clients with specialty markets that understand these risks better.
One big change involves hired and non-owned auto insurance, often called HNOA. It used to be included automatically in regular packages. Now, specialty insurers are looking at it much more carefully. Evan Taylor, senior vice president at Amwins National Transportation Underwriters, says carriers want detailed applications, financial information, and a clear picture of what they are covering before they offer a policy. HNOA is now priced closer to owned vehicle coverage, which means higher premiums and narrower protection.
Business auto insurance also differs from trucking coverage. Trucking is more straightforward due to federal regulations and detailed reporting. Business auto covers a wide variety of operations, from construction trucks to propane delivery to school buses, each with unique risks. Krieg points out that because these risks don’t fit neatly into trucking or light commercial categories, many are moving to the excess and surplus (E&S) market.
Public auto, especially passenger transport like buses, now faces more scrutiny too. High liability limits, sometimes up to $5 million, are often necessary. But with rising reinsurance costs, many insurers no longer want to offer these limits, so some companies are looking to captive insurance or risk retention groups to fill the gap.
So, how can brokers help their clients get better quotes? Krieg and Taylor say safety and openness are key. Many underwriters now expect telematics data showing driving habits even before offering a quote. Investing in safety measures and showing solid risk management can go a long way. While premiums might jump initially, businesses that improve their safety practices can often earn better terms down the road.
Wholesalers have a vital role right now. Besides giving access to specialist markets, Amwins offers extra help like claims advocacy to support clients in tough situations. Krieg mentions they guide clients through why prices are rising and how to adjust.
As insurers continue separating business auto from larger packages, the trend looks set to stay. Higher claims and costs mean auto coverage won’t be a “free add-on” anymore. Instead, insured companies will face tighter coverage and higher prices but also have a chance to improve their safety and operations. Taylor sums it up: auto insurance must now stand on its own and be priced to match the risk.
Krieg adds that while the changes can be challenging, they push businesses to become safer and better managed. Those who adapt will build stronger insurance relationships and find more stable coverage for the future.
For those interested in learning more about transportation insurance services, Amwins provides resources and expertise tailored to this shifting market.