Many businesses in Tennessee use vehicles for day-to-day operations. Whether the vehicles are used for deliveries, transporting people, or performing construction work, you are required by law to have a certain amount of commercial vehicle insurance. 

What’s more, commercial auto insurance is necessary to protect your financial well-being if one of your commercial vehicles is involved in a crash. 

An independent insurance agent in Tennessee can help you find the best commercial auto policy, as well as a reliable business insurance policy, to meet your needs as well as all of the state requirements. 

What is Commercial Auto Insurance?

Commercial auto (or business auto) insurance provides coverage for cars, trucks, and any other vehicles used in business operations. Similar (but separate from) personal auto insurance, commercial auto insurance provides liability, collision, comprehensive, personal injury, and uninsured and underinsured motorist coverage for the business owner. 

A business owners policy (BOP) does not include commercial auto coverage, so commercial auto coverage must be purchased separately.

Each vehicle your business owns or uses can be scheduled on your commercial auto policy, along with corresponding coverage for that vehicle. Different vehicles can be insured with different levels of coverage, depending on your needs and the way that you use the vehicles. But only commercial auto coverage can provide the liability protection you need to protect your business in the event of a serious car accident involving a car being driven for business purposes. 

Commercial auto insurance in Tennessee can be purchased for:

• Vehicles that your business owns
• Vehicles that your business owns, hires, or leases
• All vehicles that are used for business purposes, including those that the business does not own, hire, or lease (i.e., when you or your employees drive personal vehicles for business purposes)

Commercial auto insurance coverage is determined by either state or federal law, depending on the type of vehicle, the vehicle’s weight, the number of passengers, what the vehicle carries (e.g., innocuous goods or hazardous materials), and whether it is engaged in interstate commerce. 

Passenger carriers, freight carriers, trucks over 10,000 pounds, and vehicles that carry hazardous substances must follow federal regulations for liability insurance coverage. 

Tow trucks, taxicabs, and certain other vehicles must also comply with additional insurance requirements. But most small business owners own sedans, vans, or light trucks that must simply comply with auto insurance requirements that are the same as for personal vehicles.  

All auto insurance policies in Tennessee must include, at a minimum:

• $25,000 bodily injury liability coverage per person
• $50,000 bodily injury liability coverage per accident
• $15,000 property damage liability coverage per accident

What Does Commercial Auto Insurance Cover in Tennessee?

All commercial vehicle insurance policies in Tennessee will include the specific coverage required by law at a minimum. Insurance companies also offer several types of optional coverage. You can choose the options that are most necessary for your needs.

• Collision coverage: This covers damage to your vehicle sustained in a collision, regardless of who was at fault. 
• Comprehensive coverage: This covers the cost to repair damaged to your vehicle due to non-collision events such as fires and property crimes. 
• Uninsured motorist coverage: This covers your employee’s medical expenses and your vehicle’s damage following an accident caused by an uninsured or underinsured driver. 
• Towing and roadside assistance: This covers the cost of a service call if your company vehicle becomes disabled while it is out on the road. 
• Non-owned or hired auto liability insurance: This provides liability coverage for non-owned vehicles being used for business purposes, such as when you rent or lease a vehicle, or when you or an employee use a personal vehicle for business purposes. 

You might also want to consider purchasing commercial umbrella insurance which adds liability coverage that is beyond the limits of your commercial vehicle policy.

What Does Commercial Auto Insurance Not Cover in Tennessee?

Commercial auto insurance in Tennessee covers many claim scenarios involving your commercial vehicles, but there are certain specific exclusions where you won’t have coverage under your commercial auto policy. 

• Commercial auto insurance won't cover cases in which the bodily injury or property damage is expected or intended by the insured. If, for example, one of your drivers intentionally rear-ends another vehicle in order to cause an injury or damage the other vehicle, the resulting claim or lawsuit would not be covered by your commercial auto insurance policy. 
• Workers’ compensation insurance covers work-related injuries and illnesses. If one of your employees is injured while driving and the claim is covered by workers’ compensation insurance, then your commercial auto insurance policy will not respond. 
• Coverage is excluded for rental vehicles in your care, custody, or control and property being transported in your vehicles. You can, however, purchase coverage for these scenarios. 
• Every commercial auto policy has requirements for who is an insured driver. Some may only cover specific named drivers, while others will cover all vehicles in the policy regardless of who is driving. You need to understand your coverage and make sure you have sufficient protection for whoever regularly drives your vehicles.
• Accidents and claims that result from racing or speeding will not be covered by your commercial auto insurance. 

Your Tennessee commercial auto insurance policy likely contains additional exclusions. It’s important for you to read your policy and discuss it with your independent insurance agent so you are prepared when you have to file a claim. 

What Are the Benefits of Commercial Auto Insurance in Tennessee?

Liability lawsuits, property damage, and loss of income are not uncommon when a business car or truck is involved in an accident. Any business that owns vehicles needs commercial auto insurance to protect itself from the financial losses that can result after accidents involving their business-owned vehicles.  

Without insurance, how would you pay to repair a damaged vehicle? And could your business keep up with demand if one of your vehicles were sidelined? 

Commercial vehicle insurance helps you recover from the costs of vehicle repairs and loss of income after an accident involving one of your company-owned vehicles. What’s more, it covers you if other drivers involved in a crash sue you. 

If you don’t have any business-owned vehicles, but you or your employees occasionally use personal vehicles for business use, you also need commercial auto insurance. If you try to file a claim with your personal auto insurance policy for an accident that occurred while using your vehicle for business purposes, your claim may be denied. Non-owned or hired auto liability insurance covers personal vehicles used for business purposes. 

How Much Does Commercial Auto Insurance Cost in Tennessee?

Commercial auto insurance premiums in Tennessee can vary considerably from one company to the next. This is because insurance companies assess risk and calculate rates according to a number of different factors that are unique to your business. 

Your rates for Tennessee commercial vehicle coverage are determined based on the following:

• The number of vehicles your business needs to insure
• The type(s) of vehicles you are insuring as well as each vehicle’s year, make, model and safety features
• What you will be using the vehicle(s) to transport (e.g., food, hazardous materials, people, etc.)
• The estimated number of miles your vehicle(s) will be driven each year
• The driving records of any employees who may be operating the vehicle(s) 
• Information about the employees who will be driving the vehicles
• The amount of coverage you are purchasing

Because each insurance company has its own proprietary formula for calculating commercial auto insurance premiums, you can save a lot of money by shopping around for the most competitive price. And comparison-shopping is easy when you work with an independent insurance agent who isn’t tied to one carrier.

Do I Need an Agent to Purchase Commercial Auto Insurance in Tennessee?

There is no such thing as a one-size-fits-all policy when it comes to commercial auto insurance. A business that relies on a few cars for making local deliveries will have vastly different needs than one that uses heavy trucks for interstate commerce. 

A local independent insurance agent can help you find a competitively priced policy that meets your state’s coverage requirements. Contact an insurance agent in Tennessee to begin your search for customized commercial auto insurance.