The business of cabs, transport of goods and passengers are one of the most lucrative options to earn money. Do you own either of these? If yes, then you must have a fleet of commercial vehicles. If you own commercial vehicles, you would know the risk exposure and the liability involved.

Fearing the loss and risk will not help you run your business. Rather, you should think of taking preventive measures and Buy Commercial Vehicle Insurance. Accidental damage to your commercial vehicle, goods, and passengers will be a brunt on your savings. An insurance policy in place will be helpful for you to recover the cost of repairs.

What is Commercial Vehicle Insurance?

Commercial Vehicle Insurance is the type of insurance policy you buy to cover your commercial vehicles, which include passenger or goods carrying both, against external damages, along with personal and third-party liabilities. This type of policy also pays for the accident to the owner-driver.

The external damage(referred here) to the commercial vehicle may arise from fire, burglary, natural calamities, malicious acts or terrorist activity. Other than these, the owner of the vehicle may be held responsible for third-party liability such as bodily injury or property damage.

Your business is exposed to varied kinds of risk, and when you are a commercial vehicle owner, the quantum of loss can be massive. Any damage to or by the commercial vehicle can impact your earnings. It is to secure your financial interest that buying Commercial Vehicle Insurance is essential. Though the Third-Party Liability cover is mandatory as per the Motor Vehicle Act,1988 buying an Own Damage Cover along with it makes it a better proposition for you.

Types of Commercial Vehicle Insurance

Depending on the type of commercial vehicle you own, you may buy a policy from among these types of commercial vehicle insurance policies:

Passenger Carrying Commercial Vehicle Insurance – If you own a passenger carrying vehicle, then you may buy a Passenger Carrying Vehicle. The number of passengers may vary, but the exposure to risk is high. Any mishap or accident may lead to a huge liability. It calls for the importance of the Passenger Carrying Commercial Vehicle Insurance. 

Goods Carrying Commercial Vehicle Insurance – Insurance policy for vehicles that are used to transport goods from one place to the other is a must. Vehicles like trucks and lorries are included under the goods carrying vehicles. You may need insurance for goods carrying vehicles if the transport of goods takes time, or fails due to an accident, fire or any other damage.

Miscellaneous Commercial Vehicle Insurance – Vehicles that carry passengers from one point to the other, fall under the category of miscellaneous vehicle. Any damage to the vehicle, third-party and the owner-driver may subject the owner to financial losses. Hence, buying commercial vehicle insurance becomes important.

Types of Vehicles covered under Commercial Vehicle Insurance – All vehicles that carry goods or passengers as a part of a commercial activity need to be covered under Commercial Vehicle Insurance. Vehicles that can be covered under Commercial Vehicle Insurance are:

  • Taxi/Cab
  • Tractor
  • Passenger Bus/School bus
  • Truck/Lorry/Tempo
  • Trailer
  • Crane
  • Auto-Rickshaw/e-rickshaw
  • Commercial van
  • Other goods and passenger carrying vehicles.

Pro tip: If you are a cab driver working with ride-hailing companies then commercial taxi insurance is very important for you as it will cover the liabilities arising due to the injuries to the passengers sitting in your taxi (provided you got the passenger protection add-on).

4 Benefits of buying a Commercial Vehicle Insurance

An insurance policy is to save you from financial losses that may arise due to unexpected events like an accident or any other damage. Here are the benefits of buying a Commercial Vehicle Insurance:

  1. Pays for the repairs of the damaged commercial vehicle: Buying commercial vehicle insurance will help you pay when the vehicle gets damaged. Without an insurance policy, you will have to pay for the repairs from your pocket. 
  2. Keep your business uninterrupted: As soon as your vehicle gets repaired, you can get back to the business quickly. The cost of repairs can be recovered either through reimbursement or cashless payment. The insurance policy can help you manage the expenses, which otherwise would have impacted your savings.
  3. Protects the driver: With the Commercial Vehicle Insurance, any injury to the driver will be covered. You need a driver to run the vehicle and make money. The injury may arise while alighting from the truck or bus. Hence, the safety of your driver is important.

Saves you from legal liabilities: As per the Motor Vehicle Act, buying a third-party liability policy is mandatory. It will save you from unnecessary legal compliances as well as liability that may arise from third-party bodily injury or property damage.