Canceling a seasonal business’ commercial auto insurance policy when the work season is over may seem like a logical and wise decision to reduce a business’ overhead. After all, why should chimney sweeps, snow plowers, and holiday retailers pay auto insurance premiums during the offseason, when their businesses are closed? Canceling a seasonal business’ auto insurance policy can end up costing a business more than it saves on premiums, though. If you run a seasonal business in Vermont that shuts down for the summer, here’s why you shouldn’t cancel your business’ auto policy — and what to do instead.

Commercial Auto Insurance Vermont

Can I Save Money By Canceling My Seasonal Vermont Business’ Commercial Auto Insurance?

Coverage Gaps Can Increase Future Commercial Auto Insurance Rates

Canceling your Vermont business’ commercial auto insurance policy for a few months will likely save your business a few dollars in the short term. Over the long run, however, canceling coverage may cost your business more than it’s able to save.

Insurance companies that offer commercial auto policies generally want the businesses they insure to maintain continuous coverage, and they frequently increase premiums when businesses don’t have continuous coverage. A coverage lapse of a single day can cause a business’ premiums to go up. Canceling coverage for several months over the summer can have an even greater effect, as insurers often consider how long a lapse lasted.

When a business’ commercial auto policy go up, the increase typically lasts for some time. In many cases, the increase lasts much longer than the lapse — and the higher premiums normally eclipse any savings that dropping coverage provided.

Commercial Auto Insurance Vermont

Cancelling Coverage Leaves Vehicles Unprotected

Canceling your business’ commercial auto policy would cost your business even more if something happened to the business’ vehicles while coverage wasn’t in effect.

Even if vehicles aren’t being driven, they may be damaged while in storage. Buildings can catch on fire, and tree branches can fall on vehicles that are outdoors. Vandalism is another threat that can’t be completely ruled out.

Without business auto insurance that includes comprehensive coverage, your business likely wouldn’t have protection from such incidents — and any resulting damage could cost a lot to address. Simple repairs can run several thousands of dollars, and fixing specialized vehicles is sometimes much more.

Commercial Auto Insurance Vermont

Comprehensive-Only Business Auto Insurance Offers Affordable Coverage

Canceling your business’ commercial auto policy will likely increase its future premiums and leave vehicles unprotected, which is why this cost-saving strategy generally isn’t a good idea. There is an alternative, though. Many insurance companies offer comprehensive-only business auto insurance policies. 

A comprehensive-only business auto insurance policy may be perfect for your business during the offseason. For, comprehensive-only policies normally:

  • Cost much less than other business auto insurance policies, so your business can save on premiums during the offseason while vehicles aren’t in use
  • Are considered valid auto insurance policies, so your business won’t have any gap in coverage
  • Provide comprehensive coverage, so your business’ vehicles will be protected from a variety of perils (e.g. fires, falling branches and vandalism, depending on a particular policy’s terms and conditions)

Ask a Vermont Agent About Comprehensive-Only Commercial Auto Policies

Before you cancel your seasonal Vermont business’ commercial auto insurance policy, contact an independent insurance agent. They’ll be able to help you make sure a comprehensive-only commercial auto policy that will meet your business’ needs. Assuming it will, they’ll also be able to help you find one that’s affordable and offers the protections your business should keep throughout the offseason.