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Do I need commercial auto insurance?

Factors to consider

Don’t worry, it isn’t rocket science! Three main factors determine if you should consider purchasing commercial auto insurance:

1. Use of the vehicle

This is the most important factor. Commercial vehicles generally serve specific purposes, like transporting people, merchandise or tools, and are therefore exposed to different types of risk than personal vehicles. If your commercial use is only occasional and doesn’t involve deliveries, commercial auto insurance may not be necessary. Conversely, if you make daily trips to visit clients, transport merchandise or make deliveries, then it’s probably best to have it.

2. Type of vehicle

Some vehicles, such as tool vehicles and heavy trucks, cost more to repair or replace, and can cause extensive damage in case of an accident. Commercial auto insurance is therefore necessary.

3. Vehicle owner

If you’re the sole owner of the vehicle, personal auto insurance may be enough. However, if the vehicle belongs to a business or to your employer, commercial auto insurance is probably required. There are some exceptions, but this is generally a good rule to follow.

Psst! Check the licence plate!

  1. In ONTARIO, commercial vehicles plates use black letters and numbers, whereas car, motorcycles and trailer plates use blue.

  2. In ALBERTA, if “Class 1,” “Class 2” or “Class 3” appears on a plate, it means the car is used for commercial purposes.

  3. In QUEBEC, a licence plate number that starts with F indicates a vehicle used for business or commercial purposes by a company or self-employed individual.

Now what?

You’re now a bit better informed when it comes to commercial auto insurance. Still have questions? Contact a broker to find out which policy is best for you, or ask for an online quote to get an estimate of your premiums.

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