You’ve made the decision to buy, own and operate your very own tour bus, congratulations! This is a big step that you won’t regret and one you will get years of pleasure from. The thrill of hitting the open road, free from the cares of the everyday world as you cruise down the highways and byways of North America exploring hidden treasures and famous landmarks.
Not so fast. There are rules and obligations that you must adhere to before you can start to live your dream and in most states it is mandatory that tour buses carry liability insurance. Liability insurance protects bus owners and drivers against the cost damage to property and people caused by the bus. Liability covers the owner of the bus and the driver, if it is someone other than the owner.
Liability insurance coverage can vary from policy to policy and from state to state but as a rule they cover bodily injury, BI for short, and property damage for injuries and damage that are the fault of the tour bus driver. The insurance company and the police are the ones that make the decision about who is to blame and if both parties are what percentage of responsibility each bears.
Tour bus liability insurance is governed by individual states and not the federal government so minimum coverage requirements may be different from state to state. Usually the state where the bus is kept when not in operation is the state which determines the insurance requirements. Coverage in excess of the required minimums is can be almost always be purchased for an additional premium.
Tour bus liability insurance is generally issued in two forms, combined single limit or split limit. There are important differences to the two types of coverage and it is vital that you understand what they are and make your decision based on which form provides the best coverage for your needs.
Combined Single Limit – This type of tour bus liability insurance combines both the bodily injury and property damage coverage into one total limit. This means that if your tour bus is involved in an accident the bus and driver will be covered for all damages to people and property up to the policy’s limit.
Combined Single Limit – With this type of coverage there are two separate limits for damages caused by the tour bus or operator, one for bodily injury and one for property damage. Since the limits are separate once the limits have been met for one, unused coverage from the other can not be used to make up the shortfall in the other.
Uninsured and Underinsured – These coverages protect against you and your tour bus against damages caused by someone\something other than your tour bus when they do not have enough insurance to pay for all the damage they caused. This coverage kicks in when the accident and resulting damage is the fault of the other person.
Collision and Comprehensive – Because tour buses are not inexpensive many owners opt to purchase this coverage to protect against damages to the bus caused by a collision with another vehicle or object, such as an animal. Comprehensive coverage extends the coverage of the insurance to damage caused by things like hail, road hazards, and vandalism and usually has a deductible associated with it.