Commercial Auto Insurance Minimum Requirements in Iowa
Iowa business owners need to obtain commercial auto insurance to prove their financial responsibility. Commercial insurance provides basic protection for business assets in the event a work vehicle is involved in an accident that causes property damage or serious injury.
Without the proper insurance coverage, a lawsuit from a single accident could be enough to send an otherwise successful business into bankruptcy.
Ways to Establish Financial Responsibility
The Financial & Safety Responsibility Act states that the owner of a vehicle must be able to do one of the following after an accident involving property damage or serious injury:
- Provide poof of a valid auto insurance policy.
- Provide a copy of civil damage action decision that relieves you of all liability for expenses relating to the accident.
- Get official releases from everyone injured or suffering property damage.
- Pay cash or post a cashier's check, certified check, bank draft or postal money order payable to the Office of Driver Services for all expenses associated with your accident.
- Obtain official releases from everyone injured or suffering property damage.
- Agree to pay all expenses on an installment plan.
- Execute a warrant for confession of judgment with a damage payment schedule.
- Submit documentation of a full settlement of all damages or injuries.
As you might expect, business owners generally choose to purchase commercial insurance policies in order to fulfill their financial responsibility obligations.
Determine Whether You Need Commercial Insurance
If you are a sole proprietor who only uses your personal vehicle to make occasional business trips, you will most likely not need to purchase a commercial auto insurance policy. However, if you own multiple trucks with special equipment that your employees regularly drive, commercial insurance is a necessity.
Generally, you should use the following information when determining if commercial insurance coverage is required:
- The number of vehicles need to be insured.
- Whether or not the vehicles have business equipment attached.
- The primary purpose of the vehicles.
- The registered owner of the vehicles.
- Who drives the vehicles.
- If the limits on a personal auto policy are high enough to protect your business assets in the event of a lawsuit.
If you have questions regarding whether or not commercial insurance is required for your business, contact your nearest Department of Transportation (DOT) office.
Purchase a Commercial Policy
When you purchase insurance for your personal vehicle, shopping around is the best way to make sure you're getting a fair price for the coverage you need. This is also true for anyone who needs to purchase commercial insurance. Prices can vary significantly according to the carrier you select, so be prepared to obtain several quotes before choosing an insurance provider.
Additionally, you might want to keep in mind that there are insurance companies that specialize in providing insurance to business owners who need to cover multiple commercial vehicles.Choose a State:
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