What is the primary factor that affects the premium rates for commercial auto insurance?

The primary factor that affects premium rates for commercial auto insurance is the type of vehicle and its usage. Insurance companies assess the vehicle's make and model, as certain vehicles may be considered higher risk due to their size, capabilities, or value. For example, a commercial truck used for transporting goods is viewed differently than a passenger vehicle used for commuting.

Additionally, how the vehicle is used plays a significant role in determining risk. Vehicles used for delivery or in industries with a higher likelihood of accidents may attract higher premiums compared to those used for less risky purposes. This is because insurers evaluate the likelihood of claims based on the vehicle's purpose, which directly influences the overall insurance cost.

The other factors, while relevant to overall risk assessment and premium calculation, do not hold as much weight as the type and usage of the vehicle when it comes to setting the premium rates in commercial auto insurance. Driving history, age of the driver, and the number of employees using the vehicle are considered, but they typically carry less significance than the inherent risk associated with the vehicle itself and how it is utilized in a business context.