MONDAY, MARCH 8, 2021
When some people think of commercial vehicles, they only think of big rigs, dump trucks or specialty vans. However, commercial vehicles can include any average vehicle, including passenger cars and pickup trucks. The thing that all commercial vehicles have in common is that they are used for business purposes, even if they are privately owned by the business owner or an employee. Under the circumstances, these vehicles need commercial auto insurance.
Still, sometimes even privately owned and privately operated vehicles will qualify as commercial, and therefore will need commercial auto insurance. Pickup trucks are among the most common vehicles to fall into this category. Let’s take a closer look at why this might occur.
Insurance Needs For Pickup Trucks
Your basic, average pickup truck generally doesn’t automatically qualify as a commercial vehicle when you buy it. Though yes, they are frequently used for business purposes because of their hauling capacity, there are plenty of people who use these vehicles strictly for personal reasons.
To be considered commercial, pickup trucks primarily have to be:
A catch occurs, however, when even strictly personal truck is considered a commercial vehicle (called a light commercial vehicle or LCV) because of its weight. At this time, you might be obligated to buy commercial auto insurance even though you have no intention of using your vehicle for business.
Why Some Trucks Classify as Commercial
Pickup trucks are used, primarily, to do heavy work. That’s why they’re so commonly used in commercial driving, particularly in the construction and delivery industries.
However, even personal pickup trucks might also do a lot of heavy lifting themselves. That’s why they often are extremely powerful, much larger than the standard private car, and require a lot more skill to operate. To both the authorities and insurance carriers, this equals a higher operational risk and a higher likelihood of accidents occurring. Additionally, when problems do happen, insurers might have to pay a proportionally higher amount of money as a claim settlement.
As a result, insurers and states often view certain pickups as high liabilities, and therefore they will require drivers to both register and insure the truck as commercial vehicles. As a result, you’ll receive the coverage that is necessary to truly protect you in the face of numerous operating liabilities.
Private trucks (and other personal vehicles, like conversion vans) might classify as commercial vehicles in the following circumstances:
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Have a gross combination weight of 26,001 pounds or more (11,794 kilograms), including towed units with a gross vehicle weight of 10,000 pounds or more (4,536 kilograms).
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They are designed to carry 16 passengers or more.
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They can transport hazardous materials.
State laws on commercial vehicle registrations vary, so check with your local DMV to learn more about what your obligations are.
Of course, if you plan to use your personal pickup for business purposes, then it will qualify as commercial, and will need commercial auto insurance. Commuting to and from work does not count, however. Using a vehicle for work purposes might include frequently transporting goods or equipment for a business or driving frequently to meet with clients.
Generally, the business’s own commercial auto insurance policy will extend a benefit called hired/non-owned auto liability insurance to this vehicle. Hired/non-owned coverage will insure the business (and the driver) in case an employee driver is at fault for an accident that harms other parties, and therefore is obligated to repay others for their injuries or property damage costs.
However, you should not terminate your personal auto insurance even if your business offers you hired/non-owned auto liability insurance. Once you are off the clock, it is your personal policy that will continue to cover you. Additionally, hired/non-owned coverage is only liability insurance, and does not provide physical damage coverage for your pickup itself.
How Much is Commercial Auto Insurance for a Pickup Truck?
The cost of insurance for a pickup truck depends on many factors, including:
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Location
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Credit score
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Driving record
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Claims history
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Distance being traveled
For commercial pickup trucks in low-risk industries, this rate tends to be toward the lower end. It also depends on the driver’s driving record, however. If a business owner employs drivers, each driver’s driving record is considered on an insurance policy. It’s important to vet employees carefully during the hiring process to avoid high rates and more risk of accidents.
If you’re in doubt, speak with your agent about whether your pickup qualifies as a commercial vehicle.
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