Company cars can be beneficial for the company and the employee. The company car provides a consistent traveling standard for your employees while establishing a conforming presence for your customers. Company cars, like other vehicles, must be insured to meet at least the minimum insurance requirements for the state. But there are other considerations when establishing your insurance.
- Businesses are responsible for their vehicles, as well as the employees who operate them. In addition, most fleet and company vehicle policies insure every employee who is titled to operate a vehicle during a company's business hours. Your insurance policy should carry high enough liability limits to protect your business from legal actions resulting from bodily injury accidents. Consider coverages that carry at least $100,000 of liability insurance, but $500,000 combined single limits, and higher, are even better.
- Your policy should protect your vehicle investments. Carry comprehensive and collision coverage. These coverages will protect your vehicle from damages from fire, theft, acts of nature and fowl, or collisions with non-moving objects. These coverages help protect your company's investments (the vehicle) and help ensure that they remain on the road after an accident. If the vehicle is a total loss, the insurance will pay the actual cash value of the vehicle.
If you are leasing your company vehicles or have purchased new vehicles, consider purchasing gap insurance coverage. Gap insurance helps bridge the gap between the value of the vehicle and the remaining finance amount. Should your totaled or stolen vehicle's actual cash value be less than the finance value, gap coverage will pay the difference, up to the amount of the contract. Your business will not become subject to a large financial loss, if any. - Company vehicles can also have vehicle breakdowns and accidents. Choose rental and towing coverages. Rental coverage is ideal in an accident and will reimburse your business for rental expenses incurred after an accident that result in the loss of your vehicle's use. Towing coverage becomes available in accident situations as well. Depending on your policy, it may also be available during vehicle breakdowns, flat tire and other mechanical issues. Speak with your agent about the specifics.
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