Do I Need A Commercial Auto Insurance Policy For My Work Vehicle?

I was asked a question last week about commercial auto insurance for a home based business. “Do I need a commercial auto insurance policy for a delivery van which will be used to deliver my product?” This particular business is a new venture. It’s a baked goods catering business which prepares all product at a third-party commercial kitchen.

It can be confusing trying to determine when a commercial auto insurance policy is necessary, especially for home based businesses. If you’re trying to figure out if you need commercial auto insurance, or if you can just get by with your personal auto insurance policy, here are some scenarios that will hopefully help you decide.

When Might I Need Commercial Auto Insurance?

• If a vehicle is used in tasks related to the operator’s job, profession or business (other than commuting).
• If you are using your vehicle to transport goods or people for a fee or if you use your vehicle to conduct a service
• If you need higher limits of liability because of the nature of your work.
• If you are hauling a considerable weight in tools or equipment or towing a trailer used to conduct your business.
• If employees operate the vehicle or if ownership is in the name of a corporation or partnership.

If you as an individual are the titled owner of your vehicle, and use it for business purposes, contact your insurance agent to discuss your policy. Be certain you’re covered adequately for business use and appropriate estimated annual mileage. Many business uses and vehicle types may be excluded from personal auto insurance policies, so you want to be sure you have the right coverage.

–JK