At ContractorNerd, we’ve modernized the traditionally complex process of commercial auto insurance. Our digital platform and team of specialized brokers help you to obtain multiple quotes, bind coverage, and access proof of insurance certificates in days, not weeks. No more redundant paperwork, phone tag with agents, or waiting for documents to arrive by mail.

While our digital platform streamlines every step of obtaining insurance, our licensed specialists are always available to provide guidance when you need it. Through chat or phone, our brokers help tailor coverage to your specific trade, recommend the right limits for your project types, and explain exactly what’s covered in real-world claim scenarios. This blend of digital efficiency and human expertise ensures you get both the speed you need and the confidence that comes from making informed coverage decisions.

This comprehensive guide explains everything contractors need to know about securing the right commercial auto coverage, including what’s covered, costs, ways to save, and how to navigate today’s challenging insurance market.

ContractorNerd makes it easier to get comprehensive quotes and bind coverage in days, not weeks.

What Does Commercial Auto Insurance Cover?

At their core, commercial auto policies provide contractors with financial protection against losses and liability involving company vehicles. Some of the most important coverages include:

Bodily Injury Liability

  • Covers injuries caused to third parties by your legally liable commercial vehicles. Includes medical bills, lost wages, pain and suffering damages awarded.
  • Pays legal defense costs and settlement amounts if injured parties sue your contracting business, up to policy limits.

Property Damage Liability

  • Covers repair or replacement costs for any third party property your vehicles damage, such as another driver’s car.
  • Pays for related lawsuits against your contracting business within set coverage limits.

Collision

  • Pays to repair or replace your own fleet vehicles damaged in collisions, regardless of fault.
  • Requires you pay a deductible before coverage applies. Higher deductibles reduce premiums but increase out-of-pocket costs when filing claims.

Comprehensive

  • Covers vehicle damage from non-collision incidents like theft, vandalism, hail, floods, fires and more.
  • Also has a deductible. Helps cover expenses such as replacing a stolen trailer.

Uninsured and Underinsured Motorist

  • Provides protection if your vehicles are hit by an at-fault driver with little or no insurance.
  • Covers resulting medical and possible property damage costs up to specified limits.

Medical Payments

  • Pays medical bills for drivers/passengers hurt in your vehicles regardless of fault.
  • Provides limited medical coverage for occupants, typically ranging from $1,000 to $5,000 per person.

Those are some of the fundamental coverages commercial auto insurance offers. Additional options, such as rental reimbursement and specialty equipment coverage, may also be available, depending on your insurer.

Here are suggested minimums to consider:

  • $500,000 Combined Single Limit liability
  • $500,000 Combined Single Limit uninsured/underinsured motorist bodily injury

Increasing the CSL limits to $1 million provides robust coverage that exceeds state minimums, which often range from $25,000 to $100,000. Higher CSL limits better protect your assets from major liability claims. Limits below $500,000 can leave you exposed.

For collision and comprehensive, insure vehicles at actual cash value or replacement cost. This ensures that you can replace them if they are damaged or stolen.

With these limits, general contractors and artisan contractors can expect to pay approximately $1,500 to $3,500 per auto per year. The cost can vary significantly based on several factors that we’ll explain in the following section.

What Influences Commercial Auto Premiums?

Several variables determine the amount contractors pay for commercial auto insurance. Major factors include:

Fleet Size – Insurers charge higher premiums as the number of your vehicles increases. More vehicles mean greater risk exposure.

Vehicle Types – Heavy trucks, trailers, and other specialized vehicles have a greater damage potential and are rated higher than light-duty vans or passenger vehicles.

Primary Usage – Vehicles used for sales, service, and deliveries have higher premiums than basic commute vehicles because the nature of their usage increases the chances of accidents.

Driver Safety Records – Fleets with clean driving histories get the lowest rates. Just one or two careless drivers can quickly drive up premiums.

Service Territory – Contractors operating in congested urban areas pay higher premiums than those based in rural areas due to increased risk. Geographic service area matters.

Annual Mileage – The more miles your vehicles log each year, the greater their exposure is. High mileage equals higher premiums in insurers’ view.

Claims History – Too many past claims will cause rates to increase substantially. Insurers reward low loss ratios with lower premiums.

Coverage Limits and Deductibles – Lower liability limits, lower medical payments limits, and higher deductibles all reduce premium costs, but also increase financial risk if claims occur.

In addition to these variables, insurers also consider years in business, driver training, vehicle maintenance, credit history and other factors when pricing commercial auto policies.

Discounts to Reduce Premiums

Despite the seemingly high costs, there are many potential discounts general contractors and artisan contractors can utilize to reduce premium expenses:

Driver Safety Training – Completing defensive driving or accident prevention courses results in discounts from most insurers.

Vehicle Safety Equipment – The installation of cameras, telematics, or other technologies often leads to lower premiums.

Low Mileage – Driving fewer than a set number of miles per year may make you eligible for substantially lower rates.

Maintenance – Keeping vehicles routinely serviced helps minimize breakdowns and demonstrates your commitment to safety.

Multi-Policy – Bundling auto with general liability, property, workers’ comp etc. typically provides a sizeable discount.

Good Driver – Maintaining clean driving records without violations earns lower premiums.

Advance Premium Payment – Paying premiums in full upfront rather than in installments results in savings.

Long-Time Customer – Renewing coverage year after year with the same insurer often leads to loyalty discounts.

Be sure to inquire about any discounts for which you may qualify. Taking advantage of them makes coverage much more affordable.

How Contractors Can Control Premium Costs

While essential, commercial auto insurance represents a major expense. That’s why controlling costs through savvy management is so important without sacrificing necessary protection.

Smart strategies general contractors and artisan contractors can use to lower rates include:

Compare Quotes From Multiple Insurers – Premiums for the same exact coverage frequently vary drastically between insurers. Get several quotes to uncover the best value.

Accept Higher Deductibles – Choosing higher deductibles for collision and comprehensive drops premiums substantially. Be prepared to pay those costs out of pocket when filing claims.

Enroll Drivers in Defensive Driving Courses – Many insurers provide discounts when drivers complete additional training. This demonstrates safety commitment.

Perform Preventative Maintenance – Follow schedules to inspect, repair, and wash vehicles routinely. Address issues promptly and maintain the fleet in optimal condition. Insurers reward proactive maintenance.

Install Safety Technology – Invest in trucks equipped with helpful technologies, such as backup cameras, collision avoidance systems, lane departure warnings, GPS tracking, and telematics. These minimize accidents and reduce risks.

Review Driver Policies – Ensure that every driver reviews and signs policies that outline speed limits, cell phone usage rules, accident reporting procedures, proper loading/unloading protocols, and vehicle inspection requirements. Showing you enforce clear guidelines demonstrates responsibility.

Ask About Telematics Programs – Usage-based insurance programs that use driving data to set rates may offer additional savings opportunities. Discuss options with brokers.

Inquire About Multi-Policy Discounts – Insure your general liability, property, workers’ compensation etc. through the same provider to potentially qualify for bundling discounts.

Taking proactive measures like these go a long way towards controlling costs while keeping your vehicles and drivers properly protected. Stabilizing expenses provides valuable stability and predictability for financial planning purposes.

Current Market Update: The Hard Market Reality

The commercial auto insurance market has become increasingly challenging for contractors, with premiums rising 15-20% annually in many cases. This “hard market” is driven by several converging factors:

  • Ongoing labor shortages driving up vehicle repair costs
  • Spiraling inflation pushing up medical care and parts replacement expenses
  • Growing jury awards and litigation expenses
  • Distracted driving accidents remain prevalent
  • High-tech safety features on newer vehicles leading to pricier repairs
  • Supply chain disruptions affecting parts availability

Critical for Contractors: Due to these challenging market conditions, most insurers now require contractors to bundle commercial auto coverage with at least one other line of business insurance to even qualify for coverage. This typically means bundling with:

This bundling requirement isn’t just about discounts anymore – it’s often the only way to secure commercial auto coverage in today’s market. Many carriers will not write standalone commercial auto policies for contractors, viewing them as too risky without the broader relationship and premium volume that come from multiple coverage lines.

The silver lining? Bundling typically results in 10-25% savings across all policies compared to purchasing them separately, and provides the convenience of dealing with a single carrier for claims and policy management.

How ContractorNerd Streamlines Your Insurance Process

Finding and securing the right commercial auto coverage shouldn’t consume hours of your valuable time. At ContractorNerd, we’ve revolutionized the traditional insurance buying process with our modern, digital-first approach:

Step 1: Simplified Information Gathering. We collect 90% of the necessary information through our streamlined digital platform. No more repeating the same details to multiple agents or filling out redundant forms. Our smart system asks the right questions once and uses that data across all quote requests.

Step 2: Access to Leading Insurers. Our platform connects you with quotes from top-rated commercial insurers who specialize in contractor coverage. We leverage our relationships and volume to access markets and pricing that individual contractors often can’t reach on their own.

Step 3: Digital Binding and Documentation. Once you select a quote, we handle everything digitally. Our technology pre-fills and digitizes the forms required for underwriting, reducing hours of paperwork to just minutes. Complete the entire process online with secure digital payments, instant binding confirmation, and immediate access to certificates of insurance. No more waiting for checks to clear or documents to arrive by mail – get your proof of coverage instantly when you need it.

This streamlined approach means you can go from initial quote request to bound coverage with certificates in hand in a fraction of the time it takes through traditional channels – all while ensuring you have the comprehensive protection your contracting business needs.

Get Commercial Auto Today

Proper commercial auto insurance is crucial for contractors to safeguard their fleet assets and maintain overall financial stability. In today’s hard market, securing coverage requires a strategic approach – typically by bundling it with other essential coverages, such as General Liability or Workers’ Compensation.

The good news is that with ContractorNerd’s modern digital platform, getting properly insured takes minutes, not hours or days. And when you need guidance, our licensed brokers are just a chat or call away—ready to review your specific trade requirements, help you understand coverage scenarios, and identify smart ways to manage costs without compromising protection. From quote comparison to binding to instant certificate delivery, we’ve eliminated the traditional hassles while ensuring you get competitive rates from leading insurers with the expert support you deserve.

Don’t leave your business exposed or waste time with outdated processes. Utilize the insights in this guide and ContractorNerd’s modern platform to efficiently and affordably secure the protection your contracting business needs.