Business Vehicle Insurance – Overview

By | May 5, 2023

I was talking with an old friend the other day who has a successful landscaping company. And the subject of business vehicle insurance came up, and how he almost learned the hard way how important it is. 

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Let’s back up about 15 years – my buddy decided to start a landscaping business, and like many others, basically went the DBA route. One day he was a regular guy with a regular job, and the next he was a business owner. He already had a pickup truck, he borrowed a small trailer from his father, bought a mower and some other equipment from a big box retailer, and went on his way.

Later that summer, he was doing decent, and took on a part-time helper. One day, he sends the helper to the store to get something they needed… and there was an accident. Someone ran into the trailer, gasoline (two 5-gallon containers worth) was everywhere, and some of the hand tools were destroyed (luckily the mower was not on the trailer.)

Turns out it was the other driver’s fault, and the insurance companies worked it all out, but then he got a call from his insurance agent. Basically, they told my friend he was super-lucky. Since the other driver was at fault, their company ended up paying, but if the tables were turned and my friend’s helper was the one at fault… well, that could be an issue. 

See, my friend, like tons of other small DBA-type companies, used his personal vehicle for business. But, unknown to him, he was taking a massive risk – he never got a commercial / business vehicle policy. And the insurance company has little interest in paying out when a personal vehicle is used for business and there’s an incident (never mind the employee driving it). And honestly, you cannot blame them.

For any business vehicle, there are two things that are almost non-negotiable: the vehicle should be registered in the company name, and it must be insured with a commercial policy.  For the record, Crest Capital ONLY works with companies in business for at least two years and will finance the business vehicle in the company name, as well as register and insure it that way as well. This way there are no issues or surprises.

Remember: you don’t get to buy insurance after the fact. When there’s an incident, you either have it or you don’t. No do-overs.        

In the next post I’ll discuss a few details about business vehicle insurance that companies should know about. But for now, just know that you must have it. Anything less is taking too big a risk. 

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