Commercial Auto Insurance Texas

Commercial Auto Insurance Texas: Costs, Benefits, & Who Needs It

Texas has one of the most diverse economies in the United States, with its commercial operations ranging from working ranches to military bases. It’s the largest exporter of goods in the nation, often leaving many workers and half a million business owners traveling thousands of miles to transport products. 

The road can be a dangerous workplace, and the personal auto policy usually doesn’t cover vehicles used for business as they’re prone to more liability than personal autos. That’s why these operators or owners need a commercial vehicle insurance policy to keep their workers, company cars, businesses, and finances safe. 

What’s the best commercial auto insurance for your business? How much does it cost? 

Here’s everything you need to know about commercial auto insurance in Texas. 

What is Commercial Auto Insurance in Texas?

Commercial Auto Insurance Texas

A commercial auto insurance policy in Texas protects your trucks, cars, vans, and other vehicles for physical damage and liability coverage, usually not covered by a personal auto policy.

It’s a type of business insurance that covers any vehicle, and it’s also known as commercial vehicle insurance and commercial car insurance. This insurance policy covers funds for any damages or bodily injury that you or your employees attained during operating hours using company vehicles up to a specific policy limit.

Texas commercial auto insurance can be customized to provide businesses the coverage they need, whether they own a long haul truck or several contractor vans, helping you secure your business and bottom line.

Need commercial truck insurance in a place like Dallas, TX? Check out the Ultimate Guide to Commercial Truck Insurance

What Does Commercial Auto Insurance in Texas Cover?

commercial auto insurance texas

Like personal auto policies, commercial auto insurance offers similar coverage options for a business. However, there are other coverage options exclusive to an auto insurance commercial policy, including: 

  • Bodily Injury Liability Coverage – This insurance policy covers the fund for medical payments for bodily injury or death resulting from an accident where you are at fault. It also provides expenses for legal obligations or defense. 
  • Medical Payments or Personal Injury Protection – This usually covers the funds for the medical or hospital bills of the operator and passengers inside the vehicle getting injured after an incident, regardless of who’s at fault. 
  • Property Damage Liability Coverage – This provides protection and adequate funds if your vehicle accidentally damages a third party’s property. It also gives funds for legal obligations or defense when the other person tries to sue you. 
  • Comprehensive Physical Damage Coverage – This provides adequate funds for an operator or business owner to pay for damages to replace a vehicle from theft, vandalism, or natural disasters, including floods, storms, and fires. 
  • Collision Coverage – This insurance policy covers the expenses when your car gets damaged when it hits or gets hit by another vehicle or other objects. 
  • Uninsured Motorist Insurance – This covers the medical payments for the driver’s injuries or repair bills for property damage caused by an uninsured or reckless driver. 

Most commercial vehicle insurance policies are ‘named driver only,’ meaning only the operators listed on the policy can drive the covered auto. 

What Doesn’t Commercial Auto Insurance in Texas Cover?

Texas commercial auto insurance doesn’t cover personal or leased vehicles. Remember that your business can be held accountable if your employee gets into an accident in a personal or leased car. In this case, a hired and non-owned auto insurance policy could be the right choice for vehicles your business uses but doesn’t own. 

How Much Does Commercial Auto Insurance Cost in Texas?

Although the average costs for commercial auto insurance or commercial vehicle insurance in the United States range between $890 to $2,594 per year, several factors affect your Texas commercial auto insurance policy’s total cost. These include: 

  • Profession – Some industries have more risk than others resulting in heftier fees. For instance, a contractor that transports various tools to different construction sites daily can expect to pay more than an attorney that occasionally visits clients. 
  • Vehicle – The vehicle’s size and use can affect the rate as larger utility trucks will likely have a higher premium than small cargo vans. 
  • Driving history – Your business insurance provider will hold a motor vehicle report on all drivers with access to our commercial vehicles. Drivers with bad records, such as accidents or violations, can increase your rates. 
  • Location – It’s common to pay more for commercial auto insurance in larger cities in Texas, like Dallas, than smaller municipalities like Beaumont. 
  • Travel distance – The average distance that drivers routinely travel can influence your commercial auto insurance costs. For instance, a vehicle with a local route within San Antonio city has a lower risk than those with regional routes covering all of Texas. 

Although most businesses are encouraged to have commercial car insurance, many business owners are hesitant to get the insurance policies they need as the cost can quickly increase. You can always compare quotes from different insurance companies to see which offers the best rates, saving your business, workers, and investments. 

Read more: The Average Cost of Commercial Truck Insurance

Is Commercial Insurance Required in Texas?

According to state law, Texas commercial auto insurance requirements declare that all business owners must provide commercial vehicle policies with a minimum liability limit of $30,000 per individual involved, $60,000 per accident for bodily injury, and $25,000 for property damage.

The state also requires personal injury protection for insurance policies with liability coverage, but you can sign a waiver to decline this. It’s essential to choose limits that are best for your business on top of what the Texas state law requires because lacking adequate coverage for your specific risks can leave you responsible for costly repairs, debts, and lawsuits.

If you’re having difficulty choosing the best coverage options on commercial auto insurance for your business, you can always consult with a local insurance specialist. They can help you grab the best deals, saving your business and bottom line. East Insurance Group offers commercial auto insurance in Austin, Houston, San Antonio, Dallas, Frisco, and all other cities in Texas.

How Does Commercial Auto Insurance Work in Texas?

In Texas, all vehicles must have a minimum amount of auto liability insurance coverage, regardless of their use. Here are their liability limits:

  • $30,000 in bodily injury liability or death liability per person
  • $60,000 in bodily injury liability or death liability to more than one person
  • $25,000 in property damage per accident

The state law in texas also requires personal injury protection for the policies with liability coverage. Additionally, semi-trucks and other vehicles with a Texas Department of Transportation serial number may have other liability coverage requirements, depending on how they are used and the type of vehicle. 

Read more: Commercial Truck Financing Calculator 

Who Needs Commercial Auto Insurance in Texas?

Some professions need commercial auto insurance more than others, including but not limited to:

  • Landscapers
  • Electricians
  • Bakeries
  • Food trucks
  • Cleaning services
  • Contractors
  • Rideshare companies
  • Pizza delivery services
  • Consultants

Read more: Professional Liability Insurance Texas

Does Texas Require Commercial Auto Insurance?

Texas requires commercial auto insurance if you drive a vehicle for business purposes or if you have a fleet of commercial vehicles. Texas commercial truck requirements state that if you’re only carrying household goods, you must have at least $300,000 in liability coverage. 

Is Commercial Auto Insurance More Expensive?

Typically, commercial auto insurance costs more than personal auto insurance because commercial insurance policies tend to have higher limits. 

How to Lower the Costs of Commercial Auto Insurance in Texas

There are several ways to get cheap commercial vehicle insurance in Texas, including:

  • Higher deductibles
  • Paying your policy in full
  • Getting continuous auto insurance
  • Obtaining a commercial driver’s license
  • Asking for a discount

Read more: 10 Ways To Reduce Your Commercial Truck Insurance Costs

What Are the Documents Required for Commercial Vehicle Insurance?

Here are the documents you need to submit in case you need commercial vehicle insurance coverage:

  • RC of the vehicle and a photocopy
  • Filed and signed claim form
  • Driving license of the driver who was driving at the time of the accident
  • FIR in case of third-party death or injury or property damage

What Is the Difference Between Commercial Auto Insurance and Business Auto Insurance?

Commercial auto insurance is a policy that covers cars that are specialized for specific jobs. On the other hand, business auto insurance covers vehicles that operate in ordinary traffic. 

What if I Use My Personal Vehicle for Work?

Your personal auto insurance policy doesn’t cover you if you use your own car for business purposes. Many business owners choose hired and non-owned auto insurance to cover them in case they get into an accident while driving their personal, lease, and rented cars for work purposes. 

East Insurance Group Offers Commercial Auto Insurance in Houston, TX and Other Cities Like… 

You can get commercial insurance group in all cities in Texas, including:

  • Houston
  • Austin
  • Dallas
  • El Paso
  • San Antonio
  • Frisco
  • Irving
  • Waco
  • Plano

Is Commercial Auto Insurance Cheaper Than Personal?

Typically, commercial auto insurance costs more than personal vehicle insurance because commercial policies usually come with higher limits. Higher limits mean more coverage in an accident, which usually costs more. Personal auto policies cover one person who drives their own car, and a commercial policy covers your entire business. This is another reason commercial policies cost more than personal auto policies. 

Confused about commercial auto insurance in Texas, or do you need some help getting a quote for your business? Contact us today and get all the information you need fast and for free!