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Renting a car is as economical as renting a bike. In connection, the car rental industry generates approximately $58.34 billion and is projected to grow to $144.21 billion by 2027. While highly lucrative, there’s no doubt that the business comes with its share of risks.
That’s why you need commercial insurance for rental cars for your business.
This article features,commercial insurance for rental cars, what this is, how much it costs, policies available and the best companies offering it.
Liability insurance insurance for car rental takes care of claims filed against your car rental business.
General liability insurance, employment practices liability insurance, cyber liability insurance, and employer’s liability insurance are the most common liability policies included in the insurance for car rental companies.
General liability insurance (CGL) is the most common insurance for car rental business and is often included in business auto rental insurance programs.
This insurance for car rental business provides protection when your business is liable for the damages incurred by third parties. Specific risks covered are:
Insurance companies underwriting general liability coverage for car rentals will allow you to avail the following optional inclusions in the policy:
Insurance companies offer commercial auto insurance as a stand-alone policy or as an inclusion in the specialized insurance for car rental businesses. Usually, this commercial insurance for rental cars will provide the following coverages:
Typically, commercial car rental insurance protects against losses and is already useful for covering your rental cars. However, the best way to protect all of the cars comprehensively and cost-efficiently is through rental car fleet insurance.
Car rental fleet insurance covers rental companies with more than 10 cars used for rental services.
Commercial fleet insurance for car rental companies is largely specialized and only few offer this type of coverage. Fleet insurance for rental cars is a requirement in some states. The state requirements dictate the coverage you must include in your auto rental fleet insurance.
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Commercial property insurance primarily covers these exposures:
Commercial property insurance provides the money you can use to cover repair expenses. The amount you’ll receive will be equal to a percentage of or the total value of the damage incurred
Car rental business commercial property insurance can be added with business equipment and tools coverage. This will recoup losses if the equipment and tools essential for business operations becomes damaged or lost due to fire, theft, vandalism, and other covered risks.
The rental cars might be covered too as long as they become damaged or lost while in the premises of your business due to the aforementioned perils.
Your auto rental business will need workers’ compensation insurance to cover employees who sustain a work-related injury or disease. Having workers’ compensation insurance is crucial because it will help you cover the following without using personal funds or business funds:
Commercial rental car insurance is generally available for businesses that rent pickups, sedans, and other related medium-to-light vehicles. For those who rent vans, it’s better to get covered through tailored van rental insurance. Companies that sell this include the following policies:
Truck rental businesses can’t enjoy comprehensive coverage with car rental insurance. This is because trucks are more costly to maintain. Furthermore, unlike cars, trucks are rented to be used for transporting various goods between locations.
Carriers offer tailored commercial truck rental insurance. This consists of the following policies.
Contingent auto liability is the policy in truck rental insurance, which is not included in car rental insurance. So what does it do? Contingent auto liability insurance will help shoulder costs if your client causes an accident while using your truck, and you’re pulled into their mess.
On average, car rental insurance cost is $50 a month or $600 a year for a $1 million general liability coverage. The price you pay for your commercial car rental insurance cost varies based on various factors. Typically, these factors rely heavily on the makeup of your fleet like:
The car rental business insurance cost also depends on the extent of your coverage, the limits, the policies you have, and the carrier.
Below is a generalized breakdown of commercial car rental insurance cost estimates:
| Cost per Month | Cost per Year | |
| Commercial auto | $142 | $1,704 |
| General liability | $50 | $600 |
| Commercial property | $63 | $755 |
| Workers’ compensation | $47 | $560 |
| Business owner’s policy (BOP) | $99 | $1,191 |
For commercial trucks, insurance is $87 per month or $1,044 a year for a $1 million general liability insurance. Like other rental businesses, the premiums depend on location, the number of units, revenue, and claim history.
Van rental businesses pay $75 a month or $900 a year for a $1 million general liability insurance. Like other rental businesses, the premiums depend on location, the number of units, revenue, and claim history.
CoverWallet customizes the insurance policies of its partners to provide its own commercial vehicle rental insurance.
Policies included are general liability, workers’ compensation, and commercial property, which you can bundle through a BOP to enjoy cheaper rates.
Average cost: $49 per month
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Progressive stands out with its business car rental insurance policies. The cover includes liability, physical damage, hired auto, and medical payments.
The company covers everything, including commercial trucks and business cars, and extends to trailers, buses, and tractors.
Average cost: $82 per month
State Farm has an exceptional commercial liability umbrella or excess policy with numerous benefits, including the ability to further name other perils to fit your business needs. The company also offers commercial auto insurance and business owners’ policy.
Average cost: $75 per month
The Hartford is an excellent choice because it offers a comprehensive Business Owner’s Policy. The policy covers commercial auto insurance, professional liability insurance, and workers’ compensation insurance.
Average cost: $67 per month
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