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How to Insure Commercial Cargo

Commercial vehicle owners and operators are required to be insured with Commercial Auto Insurance. This coverage is separate and unique from standard auto insurance, which does not contain the benefits that are appropriate for vehicles operating for business purposes. Once you have commercial auto insurance, then your business, employee drivers and the vehicles in question will be protected against any number of unexpected, unavoidable accidents.

One area where you might find your commercial auto insurance a bit lacking is when it comes to cargo coverage. Items carried within your commercial vehicles are not typically covered by commercial auto insurance proper; rather, they rely on a benefit known as inland marine coverage to receive protection.


Let’s take a closer look at how commercial auto and inland marine insurance mesh in ways that are always beneficial to you.


Commercial Auto Insurance in Brief


If you drive a vehicle for business purposes (regardless of whether the business owns the vehicle), then personal auto insurance will not provide the necessary coverage. In fact, it will usually exclude commercial vehicle operations from coverage.


Under the circumstances, you will need to turn to commercial auto insurance for the requisite benefits. This coverage is designed specifically for vehicles and drivers operating on behalf of a business, but it will usually look a lot like standard auto insurance. Coverage options can include:

  • Liability Insurance ​

  • Collision Coverage ​

  • Comprehensive Coverage ​

  • Uninsured/Underinsured Motorist Coverage ​

  • Rental Car Coverage ​

  • Roadside Assistance ​

Furthermore, policies can also usually offer additional coverage that will apply to niche risks. The terms of this coverage specifically addresses the fact that a business has an insurable interest in a driver’s or vehicle’s operations. Therefore, the benefit will ensure that the business does not suffer undue financial losses simply because an accident, theft, vehicle fire, accident lawsuit or similar accident were to occur. Though you might not worry about the personal possessions you carry in your personal car, the cargo carried within a commercial vehicle is another story. Commercial cargo has significant value and is key to the business’s overall success. Therefore, it’s up to the proprietor and their employee drivers to keep this cargo safe while in their care. Suppose that you carry your own equipment in a company vehicle to visit a job site. Or, you deliver cargo to clients in various assignments throughout the day. Could you afford to replace these items if they get damaged? Could you afford to compensate clients who believe you caused them significant financial losses because their cargo was lost or damaged? To avoid putting yourself in an untenable position, you might want to see if your commercial auto policy can help cover your losses. Often, this is a possibility from which you might benefit, provided you carry the appropriate protection. Expanding Your Protection With Inland Marine Insurance

By itself, commercial auto insurance will not cover cargo carried within a commercial vehicle. If this cargo were lost or damaged, then you might need to turn to a specialty benefit known as inland marine insurance. Though you must purchase these two policies separately, they will work closely together in the event that accidents occur. Inland marine insurance specifically covers property or possessions in transit. Though the name developed at a time when most of America’s shipping was done via waterways, the market has expanded to cover items transported over roadways and through other means of transportation. It can help you in a couple of different ways. Primarily, inland marine coverage protects your business itself from unsustainable financial losses. When you need to transport critical equipment—particularly equipment of high value—coverage will be there to help you replace those items should they get damaged in a wreck, stolen or otherwise lost. This coverage is not typically insured by standard commercial property insurance, and if that coverage does provide a property damage benefit, then you might find that there’s relatively little room for error provided within that policy. Inland marine coverage is usually much better in terms of width.

​ Furthermore, an inland marine policy can cover the belongings of others carried within a commercial vehicle. For example, if a wreck damages a customer’s refrigerator that you had in your care during transportation for repairs, the inland marine policy can often cover this item. Therefore, you will have a resource available to help you compensate the client for their personal losses in these cases. Cargo that is being shipped will also have coverage under motor truck cargo insurance, which is a special type of inland marine insurance. Will I have To Pay For All Cargo Damage?

Depending on the circumstances of the cargo lost, you might or might not be obligated to cover the costs of damage equipment or cargo. For example, if another driver is deemed at fault for the accident that damages these items, then it is their liability insurance that will cover the costs of the damage to the property that was in your care. However, a client might still attempt to request compensation for the lost cargo from the business. Therefore, you should always be prepared to provide your commercial auto liability and inland marine insurance liability coverage to those who request it. The client can then contact your insurer, and the insurer can tell them if they have coverage available.

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