Every vehicle needs insurance, but not all auto insurance policies are the same. Your personal vehicle is likely insured with a personal auto insurance policy, but there is another option. Personal auto insurance policies don’t usually cover vehicles that are owned by a business or used for work.
You Frequently Use Your Vehicle to Transport Work Items
Commuting is not considered a work purpose and should be covered under a personal auto insurance policy. However, if you frequently use your vehicle to transport materials related to your work such as equipment and products.
You Transport People for Money
If you frequently transport other people in exchange for money, you may need commercial auto insurance. Some rideshare services, such as Uber and Lyft, only offer a minimum amount of coverage while the app is active. Commercial auto insurance can help guarantee you have coverage, no matter what.
You Conduct a Service Through Your Vehicle
Vehicles such as ice cream trucks and traveling pet salons need commercial auto insurance in case of an accident. If you are offering a service out of your vehicle, a personal auto insurance policy may not cover damages to your vehicle while you are working.
The Vehicle is Owned by Your Business
If your vehicle is purchased for your business and purchased with work funds, you will likely need commercial auto insurance. In fact, all vehicles owned or used by a business should be covered under commercial auto insurance, including company cars.
You Haul Heavy Objects or Equipment
Commercial auto insurance may be required by your state if your vehicle (or the items it transports) is
+work vehicles, as these may change from state to state.
Other Employees Use the Vehicle
Say you own a van for your contracting business. You often let other employees drive it to pick up supplies and travel to clients. In this case, you will likely need commercial auto insurance, as the employees need coverage while operating your vehicle for work purposes.
Commercial auto insurance policies offer a lot of the same coverages as a personal auto insurance policy, but often include higher liability limits and extra coverages geared specifically for the dangers a work vehicle may face. Be sure to purchase the right limits and coverage to suit your work needs and avoid a denied car insurance claim.