If your law firm owns a vehicle (usually leased vehicles for firm partners), you will very likely need a commercial insurance policy. For example, Utah requires commercial auto insurance coverage for business-owned vehicles.

Even when commercial auto insurance coverage isn’t required for your law firm, it’s still a smart choice. Without it, you could end up paying hundreds of thousands of dollars in medical bills and other costs.

Commercial auto insurance pays for bodily injury and property damage for accidents where you are at fault. Secondly, this coverage also typically includes legal expenses if you’re sued. Finally, if you purchase comprehensive and collision coverage, the policy will cover vehicle theft, vandalism, and other losses and damages.

Depending upon how your policy’s structure, it can include liability insurance to cover your business’s legal costs if one of your employees gets into an accident, for instance.

Unfortunately, business auto insurance does not provide coverage for personal vehicles. Therefore, if you or your employees sometimes drive personal vehicles for business purposes, consider buying hired and non-owned auto insurance.

Hired and non-owned auto (HNOA) insurance provides liability coverage for vehicles your business uses but does not own. That includes:

• Employee-owned vehicles
• Vehicles rented by a business

Commercial insurance policies are designed for commercial vehicles that cover a lot of ground. Therefore, these policies typically have higher coverage limits to account for the increased risk.

Personal auto insurance policies only cover claims related to personal use, including your commute and travel unrelated to work. Moreover, they have lower limits and usually cost less.

For example, if you’re involved in an accident while driving your personal vehicle for work, your insurance company might refuse your claim. For this reason, sole proprietors who own a vehicle used for work should consider commercial auto insurance or HNOA.