For a long time, business auto insurance was just a part of bigger commercial insurance packages, bundled with things like general liability and workers’ compensation. But now, the way insurers handle business auto coverage is changing, and it’s causing a stir in the industry.
The shift comes as insurers face rising loss ratios, especially from auto claims. Many are pulling business auto insurance out of these package deals and moving it to the specialty market instead. This means that companies looking for standalone business auto insurance are seeing fewer options in the standard market and more competition in specialty and wholesale markets.
Joe Krieg, assistant vice president at Amwins Brokerage in Chicago, explained that standard insurance companies never planned to focus on auto insurance alone. They just included it as part of larger policies. But once they looked closely at the numbers, they realized that auto claims were hurting their overall results. This has led many carriers to stop renewing the auto parts of their bundled policies. Insureds with mixed or specialty fleets are now often pushed toward wholesalers who have access to specialty insurers willing to take on these risks.
One big change is how hired and non-owned auto coverage is handled. This coverage used to be included automatically in packages at the standard market level. Now, specialty insurers are scrutinizing it closely. Evan Taylor, senior vice president at Amwins National Transportation Underwriters, said carriers want detailed applications, profit and loss statements, and clear information about exposures before agreeing to cover hired and non-owned autos. This coverage is now rated almost like owned vehicles, which means higher premiums and tighter terms for buyers.
There’s also a difference in how business auto insurance is approached compared to for-hire trucking. Trucking tends to have clear federal guidelines and reports, but business auto covers many types of vehicles and industries—from construction to school buses—each with its own risks. Krieg pointed out that because the risks vary so much, many business auto policies are moving to the excess and surplus (E&S) market, which can handle more unusual or complex risks. Public autos, like buses that carry passengers, draw even more attention because they need high liability limits, sometimes up to $5 million. Due to rising reinsurance costs, many carriers won’t offer such high limits, pushing these accounts toward captives or risk retention groups.
For brokers working with clients, safety and transparency have become key. Underwriters now want detailed telematics data—like driver behavior and mileage—before they even start quoting. Investing in risk management and safety can pay off because accounts that improve their operations often get better terms faster, even if premiums are higher at first. Taylor noted that premiums in the specialty market can be two or three times what they were under standard packages. But the long-term goal is a stronger insurance partnership, with coverage that truly reflects the risk.
Wholesalers play an important role here. They help connect insureds to the specialty markets and provide resources like claims advocacy teams to help fight tough claims. Krieg emphasized that wholesalers understand which markets will accept certain risks and can explain why prices have changed and how clients can adjust.
Looking ahead, it seems this trend of unbundling business auto from larger commercial packages will continue. Carriers are clear that auto insurance can no longer be a “throw-in” or subsidized by other lines. Instead, it needs to stand on its own with pricing that matches its risks. While this shift may be tough for some insureds, it also encourages them to improve safety and operations. Those who do are likely to find more sustainable coverage and stronger partnerships with insurers.
For those interested in learning more about Amwins and their work with transportation insurance, visit amwins.com/transportation.