Business Automobile Policy
What Does Business Automobile Policy Mean?
A business automobile policy is a type of insurance that covers vehicles, such as cars, trucks, and vans, used for business purposes. It applies to vehicles either owned or hired by the business owner and can also be extended to cover vehicles owned by employees when used for business-related activities.
Insuranceopedia Explains Business Automobile Policy
A business automobile policy covers the business owner (or company owner) and any employees authorized to use vehicles owned or hired by the business. The business owner can also choose to extend coverage to employee-owned vehicles when they are used for business purposes.
This policy pays for damages resulting from vehicular accidents and provides assistance in third-party lawsuits. A personal auto policy is not a substitute for a business auto policy. While a personal policy may cover damages to a vehicle, it only does so in the name of the vehicle owner, not the business. Additionally, if a third-party lawsuit is filed against the business due to an accident, the personal auto policy will not provide coverage for the business.
