Do You Need Special Auto Insurance In The Storage Auction Business?

When you set up your resale business, you're probably prepared to apply for business permits, sales tax permits and other legal necessities. One issue you might not have considered, though, is car insurance. Depending on your situation, you may need to purchase a commercial auto policy for your work vehicle. Failure to do so could cause problems with your insurance company, and it might leave you without coverage when you need it most.

When you purchase an insurance policy, the company will ask you several questions about your habits, including how you use your car and how many miles you put on it. They do this so they can complete the underwriting process, which calculates how much risk you carry and what your coverages should cost. High-risk drivers pay more than low-risk drivers.

If the insurance company discovers that you've been dishonest about any of your habits, they may re-evaluate you through an underwriting assessment. This could lead to a substantial rate increase, exceptions to your policy or even a canceled policy. Many times, the insurance company finds out about the behavior after you file a claim, so this leads to the claim being denied a well. This makes underwriting assessments very important.

One important question that comes up during risk assessments is whether the vehicle will be used for work purposes. Vehicles that are used heavily for work – beyond simply commuting to and from a day job – need to be insured with commercial auto policies. If you're simply using your family pickup as a hobbyist for a few auctions a year, you probably won't need to worry about it. If you're going to multiple auctions per week, hauling items and running a resale business, though, you should talk to your agent about creating a commercial policy.

In general, commercial auto policies will be listed in the name of your business. They may also have higher liability limits than standard policies to protect your business assets. Fortunately, most private insurance carriers will offer commercial policies, so you may be able to insure all of your vehicles with the same insurer and take advantage of the multi-policy discount that most insurers offer.

Commercial policies sometimes cost more than standard auto insurance, but it's worth the investment to avoid having your policy dropped as soon as you file a claim.

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