Personal vs. Commercial Auto Insurance
Buying car insurance can be tricky, especially when you have no idea what the right coverage is for your needs. In general, you have two options available: coverage for personal and commercial auto. Unless you have a business and want to protect a company car, what you need is personal auto insurance.
Basic Concepts for Personal Auto Coverage
Personal auto insurance is designed to meet the needs of consumers, both for individuals and families. This insurance protects your assets when you have an accident, by providing the funds to fix your vehicle, to cover medical expenses or to pay for liability expenses in case of being at-fault in the crash.
Getting personal auto insurance is relatively simple, but you will need to provide some basic information before you request a quote. The information you need to provide includes:
- The VIN, or Vehicle Identification Number
- The names, ages and basic information of all main drivers.
- The make and model of the vehicle.
Although some information is necessary to obtain a quote, if you share even more data, you’ll be able to get a more accurate quote. For example, if you’re a college student with good grades, then you might be able to ask about a good student discount. The quote might include discounted prices applied to your account, but you will need to prove proof to the insurer after you insure your vehicle.
Unlike a personal auto insurance plan, commercial coverage is designed for the needs of businesses with multiple drivers and multiple vehicles. It works around the possibility that each company employee can handle the cars, so liability protection is usually higher compared to the protection offered by a personal auto insurance plan.
According to the American Association of Motor Vehicle Administrators, companies don’t register their vehicles in the same way as private car owners do. Therefore, the information required to get a quote is different. A company can have a multitude of drivers, all of which would be insured under the same policy. The policy is more expensive as a result of the more substantial number of the primary drivers.
Get the Right Coverage
Although coverage for commercial auto insurance is available and you can request this type of program, it’s not the right fit if you need to cover a vehicle only used for personal purposes. Consumers are required the necessary coverage that meets or exceeds the minimum coverage required by the State. Companies and business owners who protect their assets and their employees need greater protection and a commercial policy.
When you're looking for insurance, focus on a coverage plan for your car. Avoid business plans, unless you’re thinking about starting your business and using vehicles for business purposes. Personal and commercial auto insurance are two different types of programs, designed for different situations and needs.
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