Commercial Auto Insurance In Toronto: How Much Does It Cost?

Commercial auto insurance is a necessity for businesses that use vehicles for their operations. This type of insurance covers cars, trucks, vans, and fleets used for work purposes, protecting the business, its drivers, and its vehicles from various risks. The cost of commercial auto insurance in Toronto, Ontario, can vary depending on several factors, such as the type of vehicle, usage, driving record, coverage limits, location, and deductibles. It is recommended to consult with insurance brokers or use online tools to compare quotes and find the best rate for commercial auto insurance in Toronto.

How much does commercial auto insurance cost?

The cost of commercial auto insurance in Toronto varies on a case-by-case basis. The price depends on a number of factors, such as the type of vehicle, the business type, and the number of vehicles. Plans could range from $100 to $300 per month or more.

Commercial auto insurance is designed for businesses that maintain a fleet of cars, no matter how big or small. It covers the same things as personal auto insurance, plus some extras specific to businesses. For example, commercial auto insurance covers bodily injury, property damage, other damage, and uninsured motorist coverage.

In some cases, personal auto insurance will be enough to cover an individual running a small business. However, this is rarely the case for larger companies that give control of their vehicles to their employees. If a business has an accident with an uninsured driver, they can face many financial ramifications. Therefore, comprehensive commercial auto insurance is essential.

There are three main types of commercial auto insurance:

• Business use: This is common for small businesses, home-based businesses, or solo entrepreneurs who drive to various locations to meet with clients.
• Business use for multiple drivers: This option allows multiple employees to be added to the insurance policy.
• Commercial auto use only: This is for vehicles that are only used for work purposes.

To get a better idea of how much it might cost to insure a commercial vehicle, business owners can request a quote from an insurance company.

What does commercial auto insurance cover?

Commercial auto insurance provides cover for businesses that use vehicles for work purposes. This includes cars, vans, trucks, and even bikes. The extent of the cover will depend on the type of policy, but commercial auto insurance policies generally include some or all of the following:

• Bodily injury liability insurance: This covers the business in the event that one of their vehicles causes an accident that results in injury or death. The policy can also include cover for the driver and passengers, paying out in the event of injury even if they were at fault.
• Property damage liability insurance: This covers the cost of damage to another person's property if you or an employee causes an accident. It also covers any resulting legal costs if you are sued over the incident.
• Combined single limit (CSL): CSL provides an overall limit for bodily injury and property damage claims against you, rather than separate limits for each.
• Personal injury protection (PIP): Pays for medical expenses and other costs (such as lost wages) for you and your passengers, regardless of who caused the accident.
• Medical payments (MedPay) coverage: Pays for medical expenses and other costs (such as funeral fees) for you and your passengers, regardless of who caused the accident. MedPay does not cover lost wages and is usually sold in small amounts, between $1,000 and $5,000.
• Collision coverage: Pays to repair or replace your vehicle after a car accident.
• Comprehensive insurance: Pays to repair or replace your vehicle for problems other than accidents, including theft, vandalism, fire, falling objects, and collisions with animals.
• Uninsured motorist (UM) coverage: Pays for injuries to you and your passengers if you are hit by an uninsured driver. In some states, UM coverage will also pay for damage to your vehicle caused by an uninsured driver.
• Underinsured motorist (UIM) coverage: Helps cover your medical bills if you are struck by a driver who doesn't have enough liability coverage.

In addition to the above, commercial auto insurance policies can also include coverage for towing, rental reimbursement, and auto loan or lease gap coverage.

Who needs commercial auto insurance?

Commercial auto insurance is a necessity for businesses that operate vehicles. This includes all types of vehicles, from cars and vans to trucks and motorbikes. If you run a business that uses a vehicle, you should look into commercial auto insurance.

Commercial auto insurance is the business equivalent of personal auto insurance. It covers businesses that maintain a fleet of vehicles, no matter how big or small. It provides cover for collisions and personal injury payouts, as well as damage to property, vandalism, and theft.

This type of insurance is essential for larger companies that give control of their vehicles to their employees. If an employee gets into an accident as an uninsured driver, it can result in serious financial ramifications for the business.

• Construction companies
• Travelling salespeople
• Consultants who visit clients on-site
• Auto dealerships
• Delivery services
• Restaurants offering catering services
• Transportation providers

If you use your vehicle for commercial purposes, you need commercial auto insurance. This is a separate policy from your personal auto coverage, which does not cover business activities.

How is commercial auto insurance different from personal auto insurance?

Commercial auto insurance and personal auto insurance are two distinct types of vehicle insurance that cater to different needs. Here are the key differences between the two:

Ownership and Use:

The primary distinction between commercial and personal auto insurance is the ownership of the vehicle. Commercial auto insurance is designed for vehicles owned by a business, whereas personal auto insurance typically covers individually owned vehicles. If a business owns the vehicle, commercial insurance is necessary to protect the company's finances in the event of accidents or other covered losses.

Additionally, the type of vehicle usage plays a role. Commercial auto insurance covers vehicles used specifically for business purposes, while personal auto insurance is intended for personal use and commuting. If a vehicle is used for business purposes, such as travelling to multiple job sites or transporting goods, commercial insurance is usually required.

Coverage:

Commercial auto insurance policies often have higher liability limits than personal auto insurance. This is because commercial policies need to provide more protection for businesses, as the stakes are much higher. Commercial insurance can also cover vehicles not owned by the company, such as when an employee uses their car for work.

Furthermore, commercial auto insurance can include additional coverages not typically found in personal auto policies. For example, it may include loading and unloading liability, equipment and supplies coverage, and non-owner coverage for employees driving company vehicles.

Cost:

Commercial auto insurance tends to be more expensive than personal auto insurance due to the higher coverage limits and the higher risk associated with business vehicles. The cost of commercial insurance depends on various factors, including the type of vehicle, its usage, the number of vehicles, and the driving history of those drivers.

Who Needs Commercial Auto Insurance:

If you answer yes to any of the following questions, you likely need commercial auto insurance:

• Is the vehicle owned by a partnership, corporation, or other business entity?
• Do you use the vehicle for business purposes, such as towing a trailer, carrying equipment, or performing a service?
• Do you transport people or goods for money?
• Do you have employees who drive on behalf of your business?

In summary, commercial auto insurance is designed for vehicles owned by businesses and used for business purposes, offering higher liability limits and additional coverages to protect the company's finances. Personal auto insurance, on the other hand, is intended for individually owned vehicles used for personal and commuting purposes, providing standard coverage for accidents and other incidents.

How to get a commercial auto insurance quote

Getting a commercial auto insurance quote in Toronto is a straightforward process. Here is a step-by-step guide on how to obtain one:

• Choose Your Source: You can obtain a quote directly from an insurance company, through an insurance broker, or by using an online comparison website. Each option has its advantages and disadvantages. Going directly through an insurance company may limit your options, but it can be more convenient. Brokers can offer quotes from multiple companies but may refer you to the insurance company to finalise the sale. Comparison websites allow you to see a range of prices and policies but will redirect you to finalise the purchase.
• Provide Basic Information: To get started, you will need to provide some basic information about yourself and your vehicle. This includes personal details such as your name, contact information, and address. For the vehicle, you will need to provide the make, model, and year, as well as information on its usage, such as whether it is for personal or business use.
• Answer Questions About Your Driving History: The quote provider will ask you questions about your driving history, including any accidents, convictions, or claims. Be prepared to provide honest and accurate information, as this will impact the accuracy of your quote.
• Review and Compare Quotes: Once you have provided the necessary information, the quote provider will present you with a range of quotes from different insurance companies. Take the time to review the quotes carefully, paying attention to the coverage offered, the premiums, and any additional benefits or restrictions.
• Finalise Your Selection: After reviewing the quotes, choose the one that best suits your needs and budget. Contact the insurance company or broker to finalise the purchase and ensure you understand the terms and conditions of your policy.

It is important to remember that insurance rates can vary, so it is worth shopping around and comparing quotes from multiple sources to ensure you get the best deal. Additionally, there are ways to lower your insurance rates, such as bundling home and auto insurance, increasing your deductible, or taking advantage of discounts for safe driving behaviour.

Frequently asked questions