Using your Car for Business: Insurance Considerations
With small businesses and sole proprietorships on the rise, there are an increasing number of people that are now using their personal car for business purposes. And, while many people may think that this is fine, it could land you in some hot water with your insurance company.
The truth is that many small business owners incorrectly make the assumption that if their car is covered with their personal coverage then they do not require business coverage for their vehicle. In fact, many personal car insurance policies actually have a policy that excludes drivers from using their vehicle for commercial purposes.
Many insurance companies offer insurance coverage packages that are meant specifically for small businesses such as:
Business service providers and sole proprietors
Contractors
Sales fleets
Delivery based businesses
And, many other types of businesses
What you need to know about commercial car insurance
Here are some things that you need to know if you are using your car for business purposes:
You need to have commercial car insurance coverage if you or an employee of your business is using your car as part of their job.
While some may say that you need the coverage, it is best to just get the commercial coverage. This will prevent any issues with your insurance company in the future.
Commercial auto policies are actually very similar to personal car insurance policies with the main difference being they protect your business in the case of an accident. Commercial policies protect drivers from damage or loss of your business vehicle, damage caused by you or the driver to other car and people, and injury or death of drivers.
You should consider a fleet insurance policy if you have more than 5 vehicles for your business
What should be included in the commercial coverage?
Collision coverage
Liability coverage
Coverage for uninsured and underinsured drivers
Medical bill payment coverage
Don’t try and save a few bucks by not telling your insurance company about the business use of your car. It will only create more issues and cost you more money down the road.