The following are the typical required and optional coverages available on a commercial auto policy issued in the State of Oregon. You will notice that the descriptions here are only a summary of the coverages and you should check with an licensed Oregon insurance agent for further details or read your commercial auto policy carefully for a complete list of all the coverages available to you and that they are on your policy.
Bodily Injury Liability
You own a vehicle. You have the title or are financing it. It doesn't matter. You possess it. You control who drives it. It's your responsibility. The question is: Is it your right or privilege to drive your car, truck or van on the streets and highways of Oregon? Trick question? No. A right is something guaranteed to everyone unconditionally, a privilege is earned and has certain responsibilities associated with it. It is a privilege to drive a car on Oregon roads, not a right. If it were a right anyone could get in a car, start it up and just drive crazily through the streets. Driving a car requires a license. The State of Oregon says you have to provide certain identifying documents, meet certain age and health requirements, and pass a test. That is one of the many things required to earn the privilege of driving on the streets.
You are also responsible for the injury you may cause to someone else should you be the cause of an accident. Imagine for a moment that you live in a country where if you are hit by another driver and someone you love is killed in the car accident and the driver of the other car must pay you $300 on the spot for the death of that loved one or suffer being arrested and possibly sentence to death. Some countries have that type of personal responsibility system. That is called: liability. You are responsible for the injury you cause if it is proven that you were at-fault or the cause of the accident. Most lives are determined, at least in Oregon, to be worth much more than $300.
Many have tried to come up with a formula for what a life is worth, current and potential earnings, etc. What it cost to try to save the life of that person before they died can be factored in. It is understood in the auto insurance industry that the potential loss that you may face as a driver on Oregon highways is limitless when it comes to the amount you could be responsible for paying if you injure or kill another driver because of your negligence as a driver. Limitless!
So, then, why do insurance policies have limits on them if the potential of loss is limitless? Imagine how much you'd have to pay in premium for that kind of a policy. The auto insurance company could be drained of all it's assets in one single claim if it were willing to issue limitless policies. So, instead, the insurance company offers auto insurance policies with bodily injury liability limits. An actuary (the mathematician hired by the insurance company to figure out probabilities of loss) sits down and figures out how much she should charge you, the driver facing the limitless risk of causing injury, for say $25,000 of insurance. She first looks to see what the probability is that your are going to be in an accident anyway. She can use factors like, your age, gender, zip code where you live, credit history, the type of car you have and many more factors. All that stuff has statistics. A whole database of percentages and numbers that describe what might happen to you. She then calculates how many others fit your risk profiled that are insured by that company and divides that risk of having to pay out the $25,000 by the number of drivers in your class. That is the premium you get charged plus administrative fees. Someone has to pay her salary!
What if the injury you cause exceeds $25,000? Well, the actuary has figured that out too! She has calculated the probability first that you will be in an accident and also the additional probability that the amount of injury you cause might exceed $25,000. Say, $50,000. She's also calculated that risk for $100,000; $250,000; $500,000 and $1,000,000. You might notice when you call for a quote that when you double your coverage from $500,000 to $1,000,000 of bodily injury liability that the price does not double. Why? Because the probability of you exceeding $500,000 does not double. Interesting stuff huh? All the more reason you should sit with your kid and help him do his math homework. He just might be an actuary some day for some big insurance company and make the big bucks figuring all this stuff out!
We can help you figure out what you need and what you can afford for bodily injury liability coverage. Obviously, the higher limit you have the closer you get to covering that "unlimited" risk potential mark.
Property Damage Liability
Property damage liability coverage is different from bodily injury in that there is a limit to the potential loss. Cars have stated or market values. If you hit a little old Chevy Luv pickup, well, then your potential for loss is limited to the four digit figures or less. If you hit a 700 class series Mercedes, that's a different story. But, the risk is limited. Unless its a one-of-a-kind vehicle, it can be replaced and parts can be found. What most people don't consider is the risk of doing damage to property other than a single car. What if you are responsible for a multi-car pile up on the freeway during rush hour. Ouch! That would hurt. Again, potential payout is limited to the values of the cars. How about a train?
Drivers in Portland, Gresham, Hillsboro and Beaverton, Oregon have heard of or seen on the news stories about the driver who tried to "beat the train". Never a good idea. One tried. He had $10,000 of property damage liability. The insurance company paid Trimet the $10,000. The driver got a lawsuit for an additional million or so. So, although property damage liability risk is more limited in the upper end potential of loss, you must consider carefully and discuss with your commercial auto insurance agent what limit of coverage is appropriate for you based on what you can afford.
Uninsured Motorist Bodily Injury Liability
Say you have bodily injury and property damage coverage. You have your little ID card that you carry in the car to prove it. You are driving down the highway thinking everyone else has insurance too, right? It's the law. Everyone should have it. Wrong! Statistically, there are as many as 35% of the drivers on the highway at any one time don't have insurance. That's right, just about 4 out of every 10 cars doesn't have insurance. What are the odds that if you do get into an accident that you will be hit by someone that doesn't have insurance? Irresponsibility in one area may be reflected in others. So, that probability of the other guy not having insurance is greater than then number of drivers that don't have insurance. Does that make sense? And the percentage of uninsured drivers, as you can imagine, will only increase proportionate to the decline in jobs and the economy.
What can you do to protect yourself? Oregon law requires that you also buy insurance to cover yourself and your passengers for bodily injury just in case the other driver doesn't have insurance. That doesn't make sense if it is the law that everyone has insurance. It's just reality and the Oregon legislature realizes that people are still going to break the law even with the strict impound and SR-22 requirements for those caught without insurance. Until there is a way to force place insurance on every car, uninsured motorist requirements will continue to be a reality. And, we have to pay for it.
What happens after you get hit by an uninsured driver you ask? Your insurance company pays your medical bills and then tries to sue the driver that hit you.
Uninsured Motorist Property Damage Liability
What happens when someone hits your car or truck in a parking lot and doesn't leave a note? Or you get in a fender-bender with someone you later find out doesn't have insurance. Yep, there is coverage for that too. Although, it's not mandatory. You can opt out of this coverage. But, as stated above, there are a lot of uninsured drivers out there and also a lot of dishonest people that even may have insurance but don't stop at take responsibility for the damage they cause after hitting a parked car.
Your policy can provide coverage for your vehicle if hit by someone who doesn't have insurance. It's subject to a deductible and doesn't require that you also have physical damage coverage.
Physical Damage Coverage
Whether your vehicle is a private passenger car or a semi-truck, you can purchase coverage against fire, theft, flood, hail, collision and roll-over. The cost depends on the value of your vehicle and its age. A deductible usually applies. Of course, the higher the deductible the lower the premium. You just have to figure out how much you are able to come up with at the time of loss. That's money out of your pocket.
Non-owned Auto Coverage
Sometimes a business owner has an employee use his or her own vehicle to perform certain business or employment related duties. If the employee has only a personal auto policy, business related activities might be excluded. Should a loss occur while performing duties for you, the business owner, you and your business might get sued. This non-owned auto coverage is invaluable to protect yourself in the event you and your business become responsible for a loss in which another person is using his vehicle while doing something for you. Yes, it's optional, but you might be surprised just how little it costs if you have employees who use their cars to run errands for you.
Hired Auto Coverage
Sometimes a business doesn't have the right kind of vehicle for the job or the vehicle that is usually employed is out of commission. This is where the hire auto coverage can extend to vehicles that are rented or borrowed on a temporary basis without having to list them on the policy. So, if you frequently find yourself renting a van or truck to do a job, then this might just be the coverage you need. Tell us about how often you rent vehicles. We'll see how we can tailor this coverage to fit your needs.
Additional Equipment
Some vehicle owners must install some advanced equipment and permanently attach it. Anywhere from stereos to high tech satellite tracking equipment, we can add coverage for items that didn't come factory installed. Check with us for limitations and costs.
Drive Other Car (DOC)
Rarely does a driver need a business auto insurance policy but doesn't own a car. This situation might arise when he is in need of an SR-22 filing for the State of Oregon or a requirement for employment while driving the cars and trucks of another company. Let us know if you find yourself in this situation. We'll be happy to look into it for you.