How to Know When You Need to Switch to Commercial Car Insurance
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Commercial motorcar vs. personal auto insurance
The line between a personal vehicle and a commercial vehicle is sometimes unclear. Discover out which types of auto insurance comprehend vehicles used for work.
What'south the departure between commercial and personal auto insurance?
For small businesses, the line between what is considered a personal vehicle and a commercial vehicle is frequently blurry. Sometimes pocket-size business owners and employees use their personal vehicles for business purposes. For example, they might use their own automobile to travel to job sites, send equipment, or evangelize goods.
Personal auto insurance policies most always exclude business use. That means you lot're not covered if you become into an blow while driving for piece of work (with the exception of your commute).
So, which policy covers multipurpose vehicles? To find out, let's have a closer look at three different types of auto insurance coverage.
1. Commercial auto insurance
The main difference between personal and commercial auto insurance is who owns the vehicle. If your business owns a vehicle, information technology must be covered past commercial auto insurance.
Both personal and commercial machine policies pay for legal expenses, actual injury, and belongings damage related to machine accidents. However, commercial auto insurance usually covers higher claims, different types of vehicles, and more complex legal issues.
This type of insurance coverage typically includes all the business'southward employees as additional insureds, which means every employee with a valid license tin bulldoze your company vehicle. The cost of commercial car insurance is affected by their driving records, along with the policy's coverage limits and deductible.
Commercial automobile insurance covers concern vehicles
If you're a sole proprietor who owns a vehicle used primarily for business, you may need commercial auto insurance. Commercial coverage typically has higher liability limits than personal auto insurance. Information technology can cover vehicles used to:
- Send appurtenances or equipment
- Drive clients or employees
- Perform a service that y'all're paid for
- Charge passengers a fee to ride in your vehicle
- Charge people a fee to transport goods in your vehicle
- Booty heavy, work-related loads
- Tow a trailer used for business concern
Does commercial auto insurance cover personal use?
Commercial car insurance typically covers employees who are given permission to drive your business vehicle. This policy will assist pay the costs of accidents when an employee is driving, even if the vehicle was used for personal reasons.
So, what about personal vehicles occasionally used for work? That's where a policy called hired and non-owned auto insurance (HNOA) comes into play.
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2. Hired and not-endemic auto insurance (HNOA)
If you lot or your employees apply a personal vehicle for work errands, yous should consider purchasing hired and non-owned motorcar insurance. This policy provides liability coverage if yous get into an accident while driving your own vehicle for piece of work purposes. It as well provides protection when your business concern rents or leases a vehicle.
This policy just covers legal bills resulting from an accident, not physical damage. For example, it won't pay for repairs if your vehicle is damaged in an blow.
HNOA covers personal, leased, and rented vehicles used for work
You may desire to purchase this liability insurance if:
- Your employees run work errands in their personal vehicles
- Y'all rent a auto for a business trip
- Your company leases vehicles
three. Personal auto insurance
Personal auto insurance but covers accidents that occur while you're driving your vehicle for personal use. That includes commuting to and from work and travel unrelated to your task duties. Policies typically insure the possessor of the vehicle and one or two immediate family members.
Your personal car insurance won't encompass business utilize
Almost personal auto policies specifically exclude business use. If you get into an blow while driving for piece of work, your insurance visitor volition probable reject your claim.
In some cases, personal auto insurance might include limited coverage for business use. Cheque with your insurance company to find out exactly what is and isn't covered.
How much does commercial auto insurance cost vs. personal car insurance?
In general, commercial auto insurance costs more than personal motorcar insurance. That's because commercial policies tend to have higher limits, which means more coverage in the event of an blow.
A personal car policy unremarkably covers 1 person driving their own car, but a commercial policy covers an unabridged concern. That could include multiple drivers, multiple vehicles, trucks, and employees with poor driving records.
However, commercial auto insurance doesn't have to be expensive. Information technology depends on the specifics of your business organisation. A small-scale business where one or two people drive a company car will have a much lower premium than a big concern with a fleet of vehicles and numerous drivers.
Factors that touch the toll of commercial car insurance include:
- Your manufacture risks
- The type of vehicles you own
- The number of vehicles
- How often the vehicles are driven
- Employee driving records
- The type of coverage you lot choose
- The policy limits you choose
- Auto insurance claims history
Compare quotes from trusted carriers with Insureon
Consummate Insureon's piece of cake online awarding today to compare quotes for commercial car insurance and other business insurance policies from height-rated U.South. providers. Our licensed insurance agents tin can help y'all find the right coverage for your pocket-size business.
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TOPICS
- Commercial auto insurance
- Concern insurance tips
- Hired & non-endemic auto insurance
Source: https://www.insureon.com/small-business-insurance/compare/commercial-auto-vs-personal-auto
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