Almost three out of four small businesses rely on their employees to use personal, rental, or company-owned vehicles for work-related tasks. This widespread practice poses risks that go beyond what a personal auto insurance policy can cover. Amy Grigsby, a senior transportation underwriter at Central Insurance, explains that business auto insurance works differently because it protects the business itself rather than the individual drivers.
A business auto policy, or BAP, is tailored to cover vehicles used for business purposes. These policies can protect vehicles owned by the business, those rented or leased, and even employee-owned cars used on the job. Coverage typically includes liability for injury or damage caused to others, protection for damage to the business’s vehicles, and coverage for accidents involving uninsured or underinsured drivers.
What makes these policies flexible is their ability to be customized based on the business’s needs. For example, a construction company that owns multiple work vans and has different employees driving them can get coverage that protects all their vehicles and drivers. Similarly, a small business with employees who use their own cars for work errands can add a non-owned auto endorsement to protect itself from liability. Even businesses that rent vehicles for travel or job needs can benefit from hired auto coverage to avoid costly gaps.
Grigsby points out that many businesses overlook occasional vehicle use or rentals, which could leave them exposed. She stresses the importance of working with an agent who understands these nuances and can help build a policy that truly fits the business.
But insurance alone isn’t enough. Preventing accidents requires vetting drivers carefully and providing ongoing training. Businesses that simply hand over cars to any employee without checking driving records risk serious consequences, including lawsuits or punitive damages if an accident occurs. Grigsby warns that courts may find a business negligent if it fails to verify that its drivers are qualified.
Many companies also turn to technology like GPS tracking, dashcams, and driver behavior reports to keep an eye on their fleet. These tools can highlight risky driving habits and provide clear evidence if an accident happens. However, having the technology isn’t enough unless businesses actively use the data to improve safety and build a culture where everyone understands their role in preventing accidents.
Central Insurance emphasizes personalized service, working closely with businesses to understand how vehicles are used and who drives them. Their approach means coverage is based not just on vehicle type or location but on the bigger picture, including fleet size, driver records, and safety measures.
For any business using vehicles, whether owned, rented, or employee-owned, getting the right coverage and taking steps to manage risk can make all the difference. Central Insurance encourages business owners to consult with an agent to make sure they’re properly protected on the road.