Consider you are in the pursuit of launching a truck business after newly learning it from the trucking school and getting your due license after putting in a lot of time. After sometimes you achieve what you were planning for and now you have set up a trucking business venture. However, remember you are still new to the industry, and for starters, you need to secure your venture with a financial product against any or all unfortunate underlying circumstances and risk that could damage your business in the future. In this situation you have liability exposure if you negligently damage another vehicle or injure the individuals in that other vehicle, it could cost you a lot of money to pay for their medical bills or the damage to their vehicle. That is why you need to buy commercial auto insurance. This is a financial tool that will protect your trucking business costs against all unfortunate events should an accident occur.
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Fast Facts About Commercial Auto Insurance
Commercial auto insurance is required by law in every state except for New Hampshire and Virginia. Even in the states where it is not required by law, drivers can still be held liable for damages. Find commercial auto insurance laws in your state.
Vehicles that are used but not owned by your business, such as employee vehicles or a leased truck, can be covered by hired and non-owned auto insurance. This policy is not required by law. However, personal auto insurance policies typically exclude business use, which makes this policy essential for businesses that rely on a non-owned vehicle.
Commercial auto insurance helps cover the cost of accidents involving vehicles owned by your business. That includes medical bills, property damage, and legal expenses if you’re sued.
Some policies include protection against vehicle theft, vandalism, and other types of damage. You can choose to add different types of coverage to your policy, such as collision or comprehensive coverage.
Yes, your commercial auto coverage is tax-deductible. There are many situations that allow you to deduct the cost of commercial auto insurance for tax purposes when you use your vehicle for commercial or business use.
If you are self-employed, you may be able to deduct your commercial auto insurance premium under Schedule C. If you are an employee and do not receive mileage or expense reimbursement, you can use Form 2106 (Employee Business Expenses). Your best bet is to contact the IRS or a tax adviser for clarification.
Personal use will be covered for a company-owned vehicle providing the company has commercial auto coverage. If you are driving your own vehicle to and from work without using it for commercial purposes, then it will be covered under your personal auto policy.
If you are using your personal vehicle occasionally for commercial purposes, you will need to have sufficient liability coverage under your personal auto policy, or purchase commercial auto insurance.
The best option will depend on the circumstances. If you are using your vehicle for any kind of business purpose, be sure to talk with your agent. The business may be required to get a non-owned business liability endorsement for these situations.
If your personal vehicle is insured as a commercial vehicle and other members of your family use the vehicle for personal purposes, then you may have to get a non-owned vehicle endorsement. Ask your agent about what is required for these situations.