Car Insurance Coverage For Your Business Explained
If you are trying to make sense of what options and limits you need regarding car insurance coverage for your business, we can help. We’ve covered the basics to help you read and better understand your car insurance coverage options and policy language. The following are general terms and coverages that apply to car insurance for your business. Each province has specific requirements and minimums so be sure to contact an ALIGNED Advocate to ensure you have the right car insurance for your province (In Ontario See OAP1 For More Details).
Comprehensive and Collision
Collision – Covers damage to your car when your car hits, or is hit by, another vehicle or other object. Collision pays to repair your vehicle, less the deductible you choose. For older cars, you may want to consider dropping this coverage, since it is typically limited to the cash value of your car. This coverage is not required, but if you have a loan or a lease, the lien holder may require it.
Comprehensive (Other Than Collision or OTC) – Covers your vehicle, and sometimes other vehicles you may be driving, for losses resulting from incidents other than collision. This includes damage to your car if it is stolen or damaged by flood, fire, falling objects or animals. No province requires that you purchase collision or comprehensive coverage, but if your organization has a car loan or the vehicle is leased, your lender may insist that you carry it until your loan is paid off.
Selecting Comprehensive and Collision Deductibles
Opting for a higher deductible is a way of lowering your car insurance premium. Remember, the higher the deductible, the more you’ll pay out of pocket if you have a claim. When deciding on a deductible that’s right for you, take into consideration your organizations available cash, the value of your vehicle and your organizations tolerance for risk.
Third-Party Liability and Accident Benefits
Third-Party Bodily Injury Liability (BI) – This covers injuries that you, the designated driver or policyholder (i.e. your organization) is alleged to cause to someone else. Claims for bodily injury include medical bills, loss of income, or pain and suffering. It does NOT cover the cost of damage to your organizations vehicle. It is mandatory in all provinces; however minimums will differ province to province. It also provides you with legal defence if another party files a lawsuit against you.
Third-Party Property Damage Liability (PD) – Covers you or someone driving the car with your permission if the car damages someone else’s property. Typically the property is another vehicle but it could be a fence, telephone pole, a house, etc. It also provides you with legal defence if another party files a lawsuit against you.
Accident Benefits – This coverage can provide medical expenses, income replacement and other possible benefits to you and your passengers injured in an accident. This coverage is mandatory in some provinces.
Uninsured and Underinsured Motorist Coverage (UM or UIM) – This coverage will reimburse you, a member of your family, or a designated driver if one of you is hit by an uninsured or hit-and-run driver. UM coverage comes into play when an at-fault driver has insufficient insurance to pay for your total loss. This coverage will also protect you if you are hit as a pedestrian.
Contact An ALIGNED Advocate For A Business Car Insurance Quote at 1-866-287-0448 Today