A remodeling contractor in Pembroke Pines drives his own pickup to jobs, with his company name on the doors and a utility trailer behind it. His personal auto policy is in his own name and lists the truck for commuting. On the way to a job, the trailer comes loose on I-75 and hits a car. His personal carrier asks what the truck was being used for, who owns the trailer and why the policy was never rated for business use, and the claim that follows is a lot harder than it needed to be.
Whether you need commercial auto insurance in Florida comes down to how the vehicle is owned and how it’s used, not what kind of vehicle it is. A personal auto policy is written for personal driving. Some business use can be added to it, but beyond a point, the vehicle belongs on a commercial policy, and the line is crossed more often than business owners realize.
When a Commercial Policy Is Usually Required
Several situations almost always call for a commercial auto policy.
The vehicle is titled to the business. Most personal auto carriers won’t insure a vehicle owned by an LLC or corporation, and a vehicle registered to the company generally belongs on a business auto policy in the company’s name.
The vehicle carries people or goods for a fee. Personal policies commonly exclude using a vehicle to transport people or property for compensation, which reaches delivery drivers, couriers, shuttle services and anyone hauling goods for customers.
Employees drive it. A personal policy is written around the household’s drivers. Once employees are driving the vehicle for work, the exposure belongs to the business.
It’s a larger vehicle or pulls equipment. Box trucks, heavy pickups with commercial equipment, vehicles with trailers, and anything rated by gross vehicle weight usually need a commercial policy, and trucks of 26,000 pounds or more have their own Florida financial responsibility minimums.
Contracts require it. General contractors, property managers and many commercial clients require proof of commercial auto liability at set limits before you can work for them, often with additional insured wording a personal policy can’t provide.
When a Personal Policy May Be Enough
Not every business use requires a commercial policy. A sole proprietor driving a personal car or small pickup to meet clients, show properties or pick up supplies, with no employees driving and nothing hauled for a fee, can often stay on a personal policy, as long as the carrier knows about the business use and the policy is rated for it. Real estate agents and many consultants fall into this group.
The mistake isn’t having business use on a personal policy. It’s having business use the carrier was never told about. A vehicle rated for commuting that’s actually used every day for work is the kind of misrepresentation that turns an ordinary claim into a dispute.
Employees Driving Their Own Cars Is a Separate Exposure
Many businesses own no vehicles at all and assume auto insurance isn’t their concern. But when an employee runs an errand, visits a client or makes a delivery in their own car and causes an accident, the injured party can sue the business as well as the driver. The employee’s personal policy responds first, and its limits are often low.
Hired and non-owned auto coverage protects the business in that situation, and in rental cars it doesn’t own, without insuring the employee’s car itself. It’s inexpensive, it can usually be added to a general liability or business auto policy, and it’s one of the most commonly missing coverages for service businesses. Our guide to hired and non-owned auto insurance explains how it works.
Florida Makes Vehicle Owners Responsible for Their Drivers
Florida’s dangerous instrumentality doctrine generally holds the owner of a vehicle responsible when someone they allow to drive it causes an accident. For a business that owns vehicles, that means a crash by an employee driving a company vehicle can become a claim against the company itself, whatever the employee’s own insurance. It’s a large part of why commercial auto limits for Florida businesses are usually set well above the state minimums.
What Florida Requires, and Why It Isn’t Enough
Florida requires vehicles registered in the state to carry personal injury protection and property damage liability, at minimums of $10,000 each. The state doesn’t require bodily injury liability for most private passenger vehicles, and commercial trucks of 26,000 pounds or more face higher minimums set by weight.
Those minimums are a legal floor, not protection. A single serious accident involving a business vehicle can produce claims far above them, and the business’s own assets are exposed to the difference. Most commercial clients and contracts require much higher limits anyway. Our article on business auto insurance requirements in Florida covers the rules in detail.
What a Commercial Auto Policy Covers
A business auto policy is built around the business rather than a household. It covers liability for injuries and damage the business’s vehicles cause, physical damage to the vehicles through collision and comprehensive coverage, personal injury protection and uninsured motorist coverage, and medical payments. It can also include hired and non-owned auto, coverage for any employee authorized to drive, and the additional insured and waiver of subrogation wording contracts often require. Our articles on what business auto insurance covers and what it doesn’t cover go deeper.
Two gaps are worth knowing about from the start. Tools and equipment carried in the vehicle aren’t covered by the auto policy and belong on an inland marine or tools policy. And the auto policy doesn’t cover the business’s liability for work done at the job site, which is a general liability question.
The Businesses That Almost Always Need It
Contractors and trades with work trucks, trailers and employees driving. Delivery, courier and final-mile businesses. Food trucks and caterers. Landscapers and pool services. Moving companies and equipment rental businesses that deliver. Medical transportation and any business carrying passengers. Wholesale and distribution businesses running their own delivery vehicles. Our articles on commercial auto for contractors, cargo van insurance and commercial auto for wholesale delivery vehicles cover those operations.
How to Tell Which You Need
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Is the vehicle titled to you personally or to the business?
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Does anyone other than you and your household drive it for work?
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Do you carry goods or people for customers, for a fee?
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Do you pull a trailer or carry equipment?
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Is the vehicle a box truck, heavy pickup or anything rated by gross weight?
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Do your contracts require commercial auto limits or additional insured status?
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Do employees ever use their own cars for business errands?
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Does your current carrier know how the vehicle is actually used?
If you answer yes to any of the first six, you likely need a commercial policy. If you answer yes to the seventh, you need hired and non-owned auto whether or not you own a vehicle.
For more, see our business auto insurance page, commercial auto vs. personal auto insurance, how much business auto insurance costs, the biggest business auto claims in Florida and our page on business auto insurance in Miami.
General information only, not legal advice. Florida financial responsibility requirements and policy terms vary and change; refer to your policy for the terms that apply to your vehicles.
Talk to Prestige Insurance Group
Prestige Insurance Group works with contractors, delivery businesses, service companies and fleets across Miami, Pembroke Pines, Fort Lauderdale, Orlando and Tampa. We write Progressive and GEICO directly and have access to specialty commercial auto markets for harder risks. Tell us how your vehicles are owned and used, and who drives them, and we’ll tell you whether your personal policy still fits or what a commercial policy would cost.
Call the office nearest you. Se habla español.
Orlando: 407-993-2331
Miami: 305-969-8776
Stuart: 772-247-3788
Prestige Insurance Group, License L057894
