If you live in a coastal state like Florida, you and your business face a lot of dangers when it comes to tropical storms and hurricanes. From wind, hail and flooding, hurricanes cause millions of dollars in damage across the U.S. each year. It is important for all businesses to be aware of the coverages and limitations of their business owners’ policy, especially concerning commercial auto insurance.
What Part of Car Insurance Covers Hurricane Damage?
The part of your commercial car insurance policy that covers damages to your vehicle is comprehensive coverage. Comprehensive coverage provides compensation for vehicles that are damaged due to fire, wind, hail, lightning, falling objects, smoke, theft, vandalism and more. Unlike most property insurances, comprehensive coverage does cover water damage and flooding. So, if your business’ vehicles are damaged or destroyed due to uprooted trees, lightning strikes, hail, or blown away by the wind, your commercial auto insurance policy should cover it as long as you have comprehensive coverage. Even if a flying object strikes your vehicle, this type of damage is not covered under collision coverage. Collision coverage refers to damage to your vehicle caused by objects and other vehicles while you are operating your insured car and generally won’t cover hurricane damage.
Does Commercial Auto Insurance Cover Water Damage?
Even mild water damage can be horrible for commercial vehicles, such as flooding engines and short-circuiting wires. If your business owns or uses vehicles for work purposes, you will need to make sure that your commercial auto insurance covers against hurricanes.
While flooding is excluded from most property insurance (such as commercial property), it is covered under a typical commercial auto insurance policy. If the engine floods, for example, you should be covered under your commercial auto insurance policy.
What Happens to Commercial Auto Insurance after a Total Loss?
Say in one unfortunate swoop, a hurricane destroys all of the commercial vehicles in your business’ parking lot.
In this case, you will have to document the damage and contact your insurer. Your insurer will then send a claims adjuster to investigate the damage. Depending on where you are and your insurance provider, this may be a longer process than usual if the insurer is handling multiple claims due to the hurricane.
Once the claims adjuster calculates how much compensation you will receive based on your policy and the damage, you may receive compensation for your vehicles. Generally, you will receive an advance payment before the rest of the compensation, especially if it is a large amount.
There are a few times where a commercial auto insurance claim may be denied. If you don’t have enough coverage, not meeting your deductible or have not paid previous premiums, your commercial auto insurance claim could be denied or your policy even dropped. Setting up automatic payments can prevent missing bills.
Be sure to understand your policy’s limits before an incident happens so that you are not blindsided by extra expenses when it comes to filing a claim. You will also still be expected to pay your deductible on your policy before receiving compensation.
Protecting Your Commercial Vehicles from a Hurricane
While it is impossible to prevent a hurricane from disrupting your business, there are ways to try and lessen the damage. First, measures should be taken before the danger arrives. The safety of you, your employees and families should come first. Before a hurricane arrives, you should:
1. Keep all commercial vehicles covered. If you have covered parking available, make sure all commercial vehicles are utilizing it.
2. Park on higher ground to avoid flooding damage as much as possible.
3. Tape the vehicle windows to keep out rain and water.
4. Remove impermanent fixtures and anything that could fly off the vehicles and cause damage to something or someone.
5. In the case of company cars, employees should make sure they have gas in their vehicle and move their vehicle out of the way of the hurricane.
6. Double check your commercial car insurance policy. Make sure the policy includes high enough limits of comprehensive and collision coverage for your vehicles.
Different types of commercial vehicles may need different limits of coverage depending on their weight and value. If you are unsure about how much coverage your commercial vehicles need, be sure to speak with your insurance provider.