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What Is Commercial Vehicle Insurance And Its Coverage

Published On Apr 13, 2023 10:00 AM By InsuranceDekho

What Is Commercial Vehicle Insurance And Its Coverage

There are a number of motor insurance products such as car insurance, bike insurance, etc, out of which commercial vehicle insurance is very important. As the name suggests, commercial vehicle insurance is a must-have for individuals who are using vehicles for business purposes. In fact, it is a compulsion for all business owners to have commercial vehicle insurance in case they are using vehicles such as autos, tractors, trucks, or others for performing any business-related activities. Read on to know all about what commercial insurance is and what coverage it offers. 

What Is Commercial Vehicle Insurance And Its Coverage

Coverage in Commercial Vehicle Insurance

There are different types of vehicles that get coverage in commercial vehicle insurance. Listed below are the vehicle types that get the coverage:

  • Passenger Vehicles: There are a number of passenger-carrying vehicles like taxis, buses, cabs, auto-rickshaws, and others that carry passengers who get coverage under commercial vehicle insurance. Thus, with commercial vehicle insurance, all passenger vehicles can get coverage against any uncertainty that takes place on the road.
  • Vehicles Carrying Goods: There is a set of vehicles that are used for carrying/transporting goods from one place to another. These vehicles can include tempos, autos, vans, trucks, etc. And with commercial vehicle insurance, coverage for third-party liability as well as damage costs incurred on commercial vehicles is also covered.
  • Other Vehicles: Other than trucks, buses, etc, there are other types of commercial vehicles like ones that are used for carrying out activities like farming, mining, etc. These vehicles get coverage against road uncertainties with commercial vehicle insurance.

Benefits of Commercial Vehicle Insurance

There are a bunch of benefits that you can avail yourself of when you get commercial vehicle insurance for your business. Listed below are some of the benefits of the same:

  • The premium paid towards getting commercial vehicle insurance is tax exempted.
  • Commercial vehicle insurance can be bought in bulk, making it easier for businesses to buy one commercial vehicle insurance plan for different vehicles.
  • With commercial vehicle insurance, you can get protection against any uncertainty that may take place on the road, which includes accidents, thefts, or other events.
  • You can also get protection against the rider of the commercial vehicle with commercial vehicle insurance. You can also add the number of insured to the commercial vehicle insurance.
  • Commercial vehicle insurance also provides coverage for third-party liability which means that if a third party gets injured due to a commercial vehicle, then legal fees will be covered.
  • Roadside assistance is also provided with commercial vehicle insurance plans. This means that in case the commercial vehicle runs out of fuel or is being towed due to any reason, then commercial vehicle insurance will provide the necessary coverage. 

Owing to the many benefits that commercial vehicle insurance offers, it makes sense to buy commercial vehicle insurance to protect your business against potential financial losses due to damage done to any vehicle. Moreover, it is also to note the exclusions in commercial vehicle insurance. Any damage that is caused when the driver is riding the vehicle under the consumption of alcohol, then no coverage will be offered. 

Who Should Buy A Commercial Vehicle Insurance

There are different groups of individuals who are eligible for buying commercial vehicle insurance. Listed below is the same:

  • If you are a business owner who owns more than 1 vehicle for business purposes
  • If your business revolves around the regular use of commercial vehicles like cabs, then you can issue commercial vehicle insurance

Factors That Affect Commercial Vehicle Insurance Rates

There are certain factors that affect commercial vehicle insurance as mentioned below:

  • Vehicle's age - Depending on the age of the commercial vehicle, the insurance rate may vary
  • Fuel type - Whether the fuel type used in your commercial vehicle is diesel or petrol, the commercial vehicle insurance rate will vary
  • Geographical location - If you are riding your commercial vehicle in a geographical area that involves risks such as hilly regions, then the commercial vehicle insurance rate will increase

There are other factors as well that affect commercial vehicle insurance rates such as the model of the vehicle, Insured Declared Value, category of the vehicle, and others.

Take Away

Thus, if you have a business and require one or more vehicles for business purposes then a commercial vehicle insurance is a must-have.

Also Read: 

Know About Used Car Valuation and Its Impact on Motor Insurance


This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.
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