Coverage types
Commercial Auto insurance is not a single coverage — it is a package of different protection types that can be combined based on how your Sacramento business uses its vehicles. Understanding each coverage type helps you build a policy that fits your operation without paying for protection you do not need.
Liability coverage pays for damage and injuries you cause to others in an accident. It is required by California law for any registered vehicle. Commercial liability limits are typically higher than personal auto limits because business vehicles can cause more damage and the business itself can be sued. Sacramento businesses that carry tools, haul materials, or drive in heavy traffic should consider limits well above the state minimum.
Liability coverage includes two parts: bodily injury liability, which pays for medical costs and legal fees when someone is injured, and property damage liability, which pays for damage to another vehicle or structure.
Physical damage coverage pays for damage to your own vehicle. It includes two separate coverages:
If your work vehicle is financed or leased, the lender typically requires both comprehensive and collision coverage. For older, paid-off vehicles with low market value, some Sacramento businesses choose to drop physical damage to reduce premium — but they then pay out of pocket if the vehicle is damaged.
Standard Commercial Auto policies cover the vehicle, not what is inside it. If your Sacramento business transports tools, equipment, or products, cargo coverage can pay for those items if they are stolen or damaged. This is especially important for contractors who leave tools in a van overnight or delivery businesses carrying valuable inventory.
Some businesses use a separate inland marine policy for tools and equipment rather than adding cargo coverage to the auto policy. Your agent can help compare the options.
Not every driver on Sacramento roads carries enough insurance. Uninsured motorist coverage pays for your injuries when the at-fault driver has no insurance, while underinsured motorist coverage pays when the other driver's limits are too low to cover your damages. These coverages protect you and your employees when someone else's lack of insurance would otherwise leave you paying the bills.
Medical payments coverage pays for medical expenses for you and your passengers regardless of who is at fault. It is a no-fault coverage that can supplement health insurance and cover deductibles or co-pays. For businesses with employees who ride in work vehicles, this coverage provides quick access to medical care after an accident.
If your Sacramento business rents vehicles or employees use personal cars for work, hired and non-owned auto coverage protects the business when an accident occurs. This is one of the most overlooked coverage types and is essential for businesses that do not own vehicles but still have driving exposure.
When a work vehicle is in the shop after an accident, your business loses productivity. Rental reimbursement coverage pays for a temporary replacement vehicle. Downtime coverage can compensate the business for lost income while the vehicle is being repaired. For a one-van contractor, this coverage can be the difference between staying on schedule and losing a client.
Start with your vehicle list, how each vehicle is used, what it carries, and who drives it. Share this with your insurance agent so they can recommend the right combination of coverage types and limits. Sacramento businesses with fleets should also ask about schedule rating, which can provide premium credits for safety programs and good claims history.
To build a Commercial Auto policy for your Sacramento business, visit the Commercial Auto insurance page. Also explore General Liability and Workers' Comp coverage. Call 916-822-9595 — open 7 days a week, 8am to 8pm.