Minnesota Commercial Auto Insurance Requirements

Deciding whether you need commercial auto insurance in Minnesota is an important decision for your business.

You do not want to miss out on getting the commercial auto insurance in Minnesota that you need to protect your personal assets and your business in the event of an accident involving a vehicle used by you or your employees for business purposes.

Every registered vehicle is required to have an auto insurance policy in Minnesota, so if you have vehicles registered under the name of your business, this auto insurance requirement would apply to them.

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Minnesota Commercial Auto Insurance Requirements

Commercial auto insurance in Minnesota is very similar to a regular auto insurance policy, except that it can be used for business vehicles. If you are a business owner, you likely already have a business owner’s insurance policy, but it probably does not cover the use of vehicles for your business.

When you sign up for a commercial auto insurance policy, you will need to separately list each one of the vehicles that are used by your business on the policy. If any vehicles are used specifically in the operation of your business, they should be listed on the policy.

also, you may want to add coverage for employee-owned vehicles that are occasionally used for business purposes.

The recommended minimum amount of liability coverage for a commercial auto insurance policy is about $500,000. Depending on the size of the business and the frequency of use of your business’ vehicles, you may want to increase your limits of liability up to $1,000,000.

While there will be a slight increase in your premium, you are gaining some serious peace of mind in the event that one of your business vehicles causes damage in an accident.

Auto Insurance Laws and Regulations in Minnesota

In Minnesota, all vehicles are required to be protected by auto insurance coverage. There are certain minimum limits of coverage for vehicles in Minnesota.

– State Minimum Auto Insurance

This includes $40,000 of Personal Injury Protection (PIP) coverage, $30,000 liability coverage for damage to one person, $60,000 liability coverage for damage to multiple people, and $10,000 liability coverage for property damage.

There is also a requirement in Minnesota to have $25,000 liability coverage for injuries to one person and $50,000 liability coverage for injuries to multiple people for both uninsured and underinsured motorist coverage.

To comply with these mandatory insurance requirements, drivers of business vehicles must maintain a proof of insurance card or a business policy binder to confirm they have the minimum coverage exists for every vehicle.

The fines in Minnesota for repeated failure in complying with mandatory auto insurance requirements can be as high as $3,000 along with a misdemeanor conviction on your record.

– The Use of Business Vehicles

There are also separate requirements in order for a business to use a vehicle in its operations in Minnesota.

These include having a valid vehicle registration, proof of annual vehicle inspection, and roadside safety equipment in the vehicle at all times.

Even though your primary focus as a business owner needs to be on meeting at least the minimum requirements for auto insurance, there are good reasons why you should consider going above the minimum level of auto insurance coverage.

Accidents involving business vehicles can result in high levels of damage, depending on the size of the cars involved in the accident and the cargo in any of the cars or trucks involved.

Types of Commercial Auto Insurance

The three major types of physical damage coverage for a commercial auto insurance policy include collision, comprehensive and specific perils coverage.

While these coverages are not required — and are thus purchased in addition to the state minimum limits for commercial coverage in Minnesota — you should consider purchasing them for the extra protection they offer you and your vehicle:

• Collision – This coverage offers protection for any losses due to a collision of a commercial vehicle with any other object or a collision as a result of the vehicle overturning.
• Comprehensive – This coverage protects you from anything that is not a collision. The coverage applies to anything from theft, falling objects, natural disasters, fire, and much more.
• Specific Perils – This coverage is much like comprehensive, but it only offers protection from specific named perils. Because of this, the cost of Specific Perils coverage is often less than the cost of Comprehensive coverage.

As stated previously, these coverage options, if purchased, always come in addition to the required amounts of PIP and liability coverage mentioned earlier.

If you are considering purchasing a commercial auto insurance policy for the first time, or if you’d like to upgrade your existing package, be sure to think about these options before dismissing them.

– Umbrella Policy

If your business has an umbrella policy, you should check and make sure that the business auto liability policy is one of the listed policies for which it provides additional coverage. Also, make sure to list any personal vehicles of employees who regularly run errands for business purposes.

The personal liability policies of your employees would not kick in for coverage unless the employee was specifically borrowing the car as a replacement for his or her personal vehicle.

– Coverage Gaps

Make sure that you do not have a gap in coverage for your personal vehicle that you sometimes use for business. If it is insured under a commercial policy, you will also need to have personal coverage for any accidents while you are using it for personal reasons.

Shopping for Commercial Auto Insurance in Minnesota

If you are considering whether you need commercial auto insurance in Minnesota, your decision will depend on whether you have registered any vehicles in the name of your business and how often you use your vehicle for business purposes.

Even if you have a personal auto liability policy, this coverage may not protect you if you are involved in an accident with a vehicle that was used for business purposes.

If you find out that you need commercial auto insurance in Minnesota, it is time to start doing your homework by shopping around for the best rate possible.

Thanks to the free online tools available below, it is easy to get a range of quotes on commercial auto insurance and compare them. Make sure you are getting the best policy for your budget and all of your coverage needs.

Enter your zip code below to find the best rates for commercial car insurance in Minnesota!