Misinformation about commercial vehicle insurance is more common than you might think. Whether you use a single delivery van or own a fleet of trucks, understanding the facts about your insurance coverage is essential.
Unfortunately, many business owners make decisions based on myths that can leave them underinsured or financially vulnerable. In this article, we’ll debunk some common myths about commercial vehicle insurance so you can protect your business correctly.
7 Most Common Myths About Commercial Vehicle Insurance
Myth 1: Third-Party Insurance is Sufficient
Many assume that third-party insurance is all they need for their commercial vehicles. While third-party insurance is mandatory and covers damages caused to others, it does not protect against damage to your own vehicle.
In case of accidents, theft, vandalism, or natural disasters, you could face heavy losses without comprehensive coverage. For a business that depends on its vehicles, having only third-party insurance can expose you to significant financial risks.
Myth 2: Insurance is Too Expensive and Unnecessary
Some business owners view commercial vehicle insurance as an avoidable expense, especially if their vehicles are used sparingly. However, repairing or replacing a damaged vehicle can be far higher than the insurance premium.
Moreover, without coverage, you risk significant financial losses in case of accidents, theft, or legal claims. Insurance isn’t just an added cost- it’s a critical investment in protecting your assets, business continuity, and long-term financial stability.
Myth 3: Not Every Commercial Vehicle Needs Insurance
Some believe that only large trucks or heavy-duty vehicles require insurance, but that’s untrue. Every commercial vehicle, whether a delivery van, taxi, or even an auto-rickshaw, must be insured as per the law.
Auto-rickshaw insurance, for example, protects owners and drivers from potential liabilities, accidents, and damages. Having proper insurance is crucial for financial protection and legal compliance, regardless of the size or type of the vehicle.
Myth 4: Personal Car Insurance Can Cover Business Uses
Many assume a personal car insurance policy will protect their vehicle during business activities, but this is a risky misconception. Personal insurance is designed for private, non-commercial use and typically excludes coverage for business-related incidents.
You need a commercial vehicle insurance policy if you’re using your vehicle for deliveries, transporting goods, or carrying passengers for hire. Without it, claims arising from business use could be denied, leaving you financially vulnerable.
Myth 5: All Commercial Vehicle Insurance Plans Are the Same
A common misconception is that all commercial vehicle insurance policies offer identical coverage. In reality, plans can vary widely based on vehicle type, usage, passenger capacity, and even specific industries.
For instance, a goods carrier will have different coverage needs than a passenger autorickshaw or a school bus. Reviewing policy details carefully and choosing a plan tailored to your business operations is crucial for proper protection.
Myth 6: Small Businesses Don’t Need Commercial Vehicle Insurance
Many small business owners assume commercial vehicle insurance is only necessary for large fleets or big companies. However, even a single delivery van, service car, or auto-rickshaw used for business purposes needs proper coverage.
Accidents, theft, or damage can lead to significant financial losses, regardless of the business size. Commercial vehicle insurance protects small businesses from unexpected expenses and ensures compliance with legal requirements.
Myth 7: All Drivers Are Covered Under the Insurance Policy
It’s a common misconception that commercial vehicle insurance automatically covers anyone driving it. In reality, policies usually specify who is covered, and allowing an unlisted or unauthorised driver behind the wheel could lead to claim rejection.
To avoid complications, businesses should ensure that all regular drivers are properly listed and meet the insurer’s eligibility criteria, such as holding a valid commercial driving license.
Understanding the realities of commercial vehicle insurance is crucial for safeguarding your business operations and finances. Falling for common myths can leave you underprotected, non-compliant with legal requirements, and vulnerable to heavy losses.
By debunking these misconceptions, you can make informed decisions, choose the right coverage, and ensure that your vehicles and drivers are adequately protected. Review policy details carefully and consult your insurer to get the best possible coverage.
