How Much Does Commercial Auto Insurance Cost in Michigan? | Business Insurance 101

How's it going, everybody? If you are a business owner, CFO, executive, or somebody within a business that handles the commercial insurance program, and you do have company vehicles, then this video is for you. Today, I'm going to discuss one of the most important insurance policies you can have for your business, and that is commercial auto insurance. I'll go over how much this policy will typically cost, and some of the coverages that you should be looking out for to make sure that you're properly covered. Thank you for stopping by. My name's Brian. I'm an independent insurance agent based here in the state of Michigan, Metro Detroit specifically, and I work with businesses on their commercial insurance programs, as well as helping families and individuals with their personal insurance, their home, their auto insurance as well. My goal with this channel is to pass on a little bit of educational information to you so that you can make more informed decisions around your insurance, and then overall, help answer any questions that you might have. Let's get into it. Before we get too far into the video, I do want to invite you to subscribe to the channel. If you find this video helpful, useful, anything like that, please feel free to like, share, pass it along with anyone else as well. Let's start with the basics. A standard commercial auto policy will typically include a few key coverages. First is liability coverage. This helps protect your business if you or one of your employees, one of the listed drivers on the policy, gets into an accident, and then there's injuries or property damage. It can help cover the medical expenses for those injured third parties, as well as any potential legal fees if there is a lawsuit that follows. A common starting point for many businesses out there is going to be a million dollars in combined single limit coverage, but that being said, it is not uncommon to have higher liability coverage requirements, whether it be with a certain contract, vendor, business partner, whoever it may be that could be requiring that. In those situations, you do have a couple options. One would be to increase the actual limit on your commercial auto policy, or another cost-effective way could be to add an umbrella policy, which would sit over more than just your commercial auto, but also your general liability insurance and worker's comp. The next coverage I want to talk about is your PIP coverage. In Michigan, this is very important, your personal injury protection coverage. Even on a commercial auto policy, you will still need to make a selection, and we will almost always recommend selecting unlimited for this coverage option. This will help cover the medical expenses from any injuries because of an auto accident. This will be regardless of who's at fault. In addition to your liability and your PIP coverage, there's also your fiscal damage coverages, so your comprehensive and collision coverages. These protect your vehicle if it's damaged in an accident, stolen, vandalized, anything like that. These coverages can be optional, but if your vehicle is financed, there's a good chance that you will be required to carry these. Then your deductible for these coverages, which is the amount that you would be responsible for out of pocket before insurance kicks in, will impact the cost of your policy. A higher deductible will typically lower your premium, and a lower deductible will be more expensive. Then another coverage that is definitely worth considering is hired and non-owned auto coverage. This is especially important if your employees ever use their personal vehicles for work errands, or if your business ever rents vehicles. This will help provide liability coverage in those circumstances, and these exposures are not typically covered on a standard commercial auto policy unless this endorsement's added on. Now, let's go into the cost of commercial auto insurance, how it's determined, and then a general range of premiums. First, it is important to note that commercial auto insurance premiums can vary a lot from one business to another, depending on a variety of factors. Things like the type of business you operate, and what the vehicles are being used for. And then the vehicle type also plays a role. A cargo van is going to have a different premium than, say, something heavy duty like a dump truck. Then the driving radius of the vehicles, whether it's just local or going regionally or out of state. Then the driving records for yourself and your employees will also play a role and impact your rates. Then, just like with any other type of insurance, your claims history will also play a big factor in this. If you have a history of claims, that can definitely increase your premiums. And also, things like where the vehicles are garaged can also play a role. So, with all these variables at play, the typical starting point for one vehicle with maybe just basic coverages will most likely start at around $2,000 a year, and this would be for something like a standard pickup truck or a van. Now, if you are insuring a heavier vehicle, such as with a semi-truck that's hauling a trailer, these premiums could be much higher and go up to $15,000, $20,000 a year or more. So, that is something that I want to note as well. And also, if you do have multiple vehicles on the policy, the cost per vehicle often goes down. So, depending on all the factors, sometimes a business could end up paying less than $2,000 a year per vehicle. But again, this will depend on your business's individual situation. Overall, with all of this, there really is no one-size-fits-all policy, one-size-fits-all premium for any type of business. You really want to make sure that you are properly covered, have the right policy in place, but at the same time, not overpaying. So, thank you for watching, and if you are looking for help with your commercial auto insurance or commercial insurance program as a whole, I would love the opportunity to work with you and see if our team can help. There are a lot of ways to get a hold of me, and they should all be in the description below. So, please feel free to text, call, email, fill out a contact form, whatever is easiest. And if you have any other questions about insurance, please feel free to either reach out directly or leave them in the comments below. I would love to help answer those as well. So, thank you again.