How Much Is Commercial Auto Insurance?

On average, commercial auto insurance costs around $1,762 per year, according to data from Insureon. Several key factors affect commercial car insurance rates, like the number of vehicles you need to insure and your location. 

If your business owns or leases vehicles, commercial auto insurance is probably a legal requirement in your state. But before you purchase coverage, it’s helpful to know how much commercial auto insurance costs and which insurers offer it. We considered which insurance companies have some of the cheapest commercial auto insurance rates and how to choose the best commercial car insurance policy for your business.

Average Cost of Commercial Auto Insurance

While the average cost of commercial auto insurance is about $147 per month, your premium is calculated based on various factors, including your coverage choices and limits, and insurer. State law may require you to have certain coverage minimums on your policy. For example, New Jersey requires the following commercial auto insurance minimums: 

• $15,000 per-person bodily injury liability
• $30,000 per-accident bodily injury liability
• $5,000 per-accident property damage liability
• $15,000 personal injury protection

Factors Influencing Cost

An insurer’s premiums are based on several main criteria. Here are some of the factors that commercial car insurance companies look at when calculating your quote.

Coverage Types

There are several types of commercial auto insurance you can purchase. At a minimum, most states require business owners to carry bodily injury and property damage liability insurance, and uninsured/underinsured motorist insurance.

For more protection, you might also purchase optional coverages, like collision and comprehensive insurance, which cover your work vehicles against physical damage not sustained in an accident. 

Coverage Limits

When you purchase commercial car insurance, you need to determine your coverage limits for each coverage type. Most states require a minimum amount of liability and uninsured/underinsured motorist coverage. However, you can typically select higher coverage limits if you want additional protection. Choosing higher coverage limits will likely raise your premium.

Deductibles

Commercial auto insurance policies often have a deductible, which is an out-of-pocket cost you’re responsible for paying if you have a claim. Choosing higher deductibles will result in a lower premium, whereas selecting lower deductibles will raise your premium. 

Vehicle Types

The type of business vehicle(s) you use will also impact your commercial auto insurance rate. For example, a brand-new cargo van might be more expensive to insure than a used pickup truck. Other factors that can affect your rate include the vehicle’s safety ratings, cost of repairs, and theft rate.

Number of Vehicles

If your business owns a fleet of work vehicles, you can expect your commercial auto insurance cost to be higher than it would be for one vehicle.

Employee Driving Records

When you apply for commercial auto insurance, the insurance company will review the driving records of every individual you list as a driver. If your employees have a history of accidents, speeding tickets, or other violations, your premium might increase. Conversely, if all your employees have clean driving records, it could lower your rate.

Top Commercial Auto Insurance Companies

Most of the largest insurance companies sell commercial auto policies. However, it’s a good idea to compare several providers before purchasing business auto coverage. Here are some of the top commercial auto insurance companies.

The Hartford

The Hartford sells commercial car insurance to businesses of many types and sizes, including large businesses that may need to insure multiple vehicles. You can add several endorsements to your policy for additional coverage such as downtime loss coverage, which replaces lost income if something happens to your vehicle.

Nationwide

Nationwide offers a wide selection of endorsements for commercial auto insurance, like expanded towing insurance, new vehicle replacement cost coverage, and gap insurance. You can also get a 10% discount when you enroll in Nationwide Vantage 360 Fleet, the company’s telematics program for businesses. 

Progressive

Progressive is the leading provider of commercial auto insurance in the U.S., with policies on nearly two million vehicles. Progressive stands out for its large selection of endorsements and discounts. You can save money if you’ve maintained prior insurance coverage, bundle your policies, pay in full, or insure your personal vehicle with Progressive.

Farmers

Farmers offers robust commercial auto insurance coverage to businesses in various industries, including coverage specific to food trucks. You can customize your policy with several endorsements, like rental car insurance and loss of use coverage. Also, Farmers has a telematics program in some states that allows you to monitor your employees’ driving habits and locations while using work vehicles.

Geico

Geico, which is owned by Berkshire Hathaway, sells commercial auto insurance for most vehicle types, including vans, cars, box trucks, and service utility trucks. Berkshire Hathaway, across its subsidiaries, has received very few complaints for its commercial auto insurance policies, according to the National Association of Insurance Commissioners (NAIC). 

Allstate

Allstate sells commercial auto insurance for many types of businesses and insures most work vehicles, like cars, SUVs, vans, and pickup, box, and service utility trucks. Allstate’s telematics program, Drivewise, provides up to a 20% discount in some states when you demonstrate safe driving habits.

State Farm

State Farm has been selling business insurance since 1935. It was also the top-rated company for overall customer satisfaction in J.D. Power’s 2022 U.S. Small Commercial Insurance Study. Although State Farm doesn’t offer online quotes for commercial auto insurance, the company has nearly 19,000 agents around the country who can help you purchase a policy. 

How to Save Money on Commercial Auto Insurance

The cost of commercial auto insurance varies for every business. However, there are ways to save money on your coverage.

• Choose high deductibles: For policies that require a deductible, like collision insurance, choosing a higher deductible will likely reduce your monthly premium. 
• Maintain a clean driving record: If all your employees have good driving records, you can often get a cheaper commercial car insurance rate. To keep your rate low, encourage employees to drive safely and avoid accidents.
• Shop around: The first commercial auto insurance quote you receive might not be the best. Shop around and compare quotes from several insurers to get the best rate.
• Pay your premium in full: Many insurance companies will offer a discount if you pay your annual premium upfront and in full. 

How to Choose the Best Commercial Auto Insurance 

All commercial auto insurance policies are slightly different. Before you purchase coverage, it’s important to make sure you’re choosing the best policy for your business’ needs. Here are a few things to consider as you shop for commercial car insurance. 

• Evaluate your coverage needs: Think about how much coverage and what type of coverage your business needs. For example, if you recently purchased a brand-new work van, you might want to add optional policies, like collision insurance or new vehicle replacement cost coverage. If you’re concerned about the potential financial consequences of an accident, you may decide to get higher coverage limits for liability insurance. 
• Review the fine print: It’s a good idea to review the fine print of a commercial car insurance policy before you purchase it. You should know which losses are covered, what’s not covered, and how much coverage the policy provides. If you have questions about the details of the policy, an agent can provide answers.
• Compare multiple quotes: To find the best and most affordable commercial car insurance policy, get quotes from several different insurance providers. For consistency, get quotes for the same coverage types and limits.