For years, business auto insurance was just one part of larger commercial policies that mainly focused on things like general liability and workers’ compensation. But now, insurers are changing how they handle this coverage. Due to rising losses, many are separating business auto from those bundled packages and moving it into specialty markets instead.
This change means transportation underwriters are looking at business auto risks differently. Insured businesses are feeling the impact as they face higher costs and narrower coverage. Joe Krieg, assistant vice president at Amwins Brokerage in Chicago, explained that many standard insurers didn’t initially plan to focus on auto insurance. They offered it because it was part of larger deals. But when they reviewed claims and losses, they realized auto coverage was actually a money-losing part of their business.
As a result, many carriers are choosing not to renew just the auto portion of bundled policies. This is pushing businesses, especially those with mixed or specialized vehicle fleets, to seek insurance through wholesalers who have better access to specialty markets. These specialty markets have more expertise and willingness to take on risks that standard carriers now avoid.
One big shift is happening with hired and non-owned auto coverage (HNOA). This coverage used to be included automatically in standard policies. Now, in the specialty market, it is under much closer examination. Insurers want detailed applications, profit and loss statements, and clear information on what risks they are taking on. Premiums for HNOA are rising as it is now rated similarly to owned vehicles, which means businesses need to prepare for higher costs and provide more information.
Another difference arises between business auto and for-hire trucking. Trucking has federal regulations and reporting that help insurers assess risk. Business auto covers a wider range of industries like construction, propane distribution, and school bus services, each with their own risks. This makes underwriting more challenging, pushing many of these policies into excess and surplus (E&S) markets.
Passenger transport, especially buses, is one area getting particular attention because of the high liability limits required, often up to $5 million. Many insurers are reluctant to offer such high limits due to reinsurance costs, leading some operators to look at captives or risk retention groups for coverage.
To get the best quotes in this tough market, safety and transparency are key. Insurers are now asking for telematics data—information on driving behavior, mileage, and safety measures—even before offering a price. Firms that invest in safety practices and can show improved operations tend to get better terms over time, even if premiums start out much higher.
Wholesalers like Amwins play a critical role by connecting insureds with the right specialty markets and advising them on why prices are changing. They also provide support with claims advocacy to help clients through difficult claims.
This trend of separating business auto from general packages looks set to continue. With losses staying high, insurers are pricing auto risk on its own merits. While this means coverage will likely be narrower and more expensive, it also pushes businesses to improve their safety and risk management—a change that could lead to stronger insurance relationships in the long run.
To learn more about transportation insurance options, visit amwins.com/transportation.