Comprehensive vs. Commercial Insurance
Figuring out what type of insurance you need to fulfill legal requirements can be confusing. Sometimes, people can get their insurance needs mixed up, especially when it comes to comprehensive versus commercial insurance. Comprehensive insurance means that one person or one piece of property is comprehensively covered. By contrast, commercial insurance pertains to the different lines of insurance that are applicable in the business world. Understanding both types of insurance will help you better decide if and when to purchase a policy.
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Scope
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The greatest difference between comprehensive insurance and commercial insurance is the intended scope of each type of insurance. Comprehensive insurance typically covers all types of physical damage that can occur to a person's property, including vandalism, accidents or natural disasters. This type of insurance covers the personal property of one policy holder; in the case of automobiles, collision insurance -- that cover accidents with other drivers -- is usually purchased in the same policy as comprehensive insurance.
Commercial insurance is business insurance that is comprised of various lines of insurance pertaining to commercial business, such as property insurance and liability insurance. Different commercial insurance policies cover all the business's property and personnel.
Coverage
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Comprehensive insurance doesn't generally cover collisions, but it provides financial protection against physical damage from a range of other causes. Comprehensive automobile insurance offers coverage for damage from vandalism, fire, theft, windstorm, hail, tornado, flooding, windshield damage, falling objects or animal damage in case of collisions with a bird or deer. Commercial insurance offers comprehensive coverage for different types of property and business liability. Commercial automobile insurance, for instance, covers all of the bodily injury, property damage, comprehensive coverage and collision coverage that a personal policy covers, but does so for an entire fleet of business vehicles.
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Types of Commercial
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Comprehensive insurance generally applies only to personal automobile insurance, but there are numerous lines of commercial insurance that a business might take out a policy. There are three main types of commercial insurance: commercial property insurance, business liability insurance and workers compensation. Lines of commercial property insurance include debris removal, glass, inland marine, crime and tenant insurance. These policies cover property damages either from specific sources or for specific pieces of property. Liability insurance, that covers third party injuries for lawsuit protection, can include automobile, malpractice or officer's liability insurance for nonprofits. Workers compensation insurance is state regulated and legally required for most businesses to prevent against negligence lawsuits from employees.
When To Buy?
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In many cases, a business is legally required to obtain certain types of commercial insurance. Certain medical professionals are often required by state law to have malpractice or any other applicable professional liability insurance in case of lawsuits from clients. Legal requirements for commercial insurance are designed to keep businesses productive by requiring them to insure for common issues.
Comprehensive insurance, on the other hand, is often up to the discretion of a car's owner. Unless the owner takes out a bank loan to finance the car's purchase, comprehensive insurance is considered an owner's private choice. An owner may want to take out a comprehensive insurance policy if the car has a high resale value or is otherwise a target for theft.
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References
- SELCO Community Credit Union: Glossary - Auto Buying and Lending
- Maine.gov: Frequently Asked Questions - Commercial
- allinsuranceInfo.org: Comprehensive Insurance Coverage
- GEICO: About Commercial Auto Insurance
- FindLaw: Different Types of Commercial Insurance
- Business.gov: Types of Business Insurance
