Most drivers are shocked when they learn that their personal auto insurance does not cover business use. And unfortunately, they discover this a little too late, usually after a claim has been filed and the insurance company tells them there is no coverage. So to help you avoid a disastrous claim situation and understand the difference, here are some reasons why personal auto insurance doesn’t cover business use.
Business Use – It’s Riskier than Personal Use
Insurance companies charge rate according to the risk. Driving a car to the grocery store poses some threat, but not as much as say, carrying a dump trailer full of debris from a construction site. Here are some other reasons why your personal auto insurance doesn’t cover business use of a personal vehicle.
Transporting Stuff, personal auto policies will not pay for property damage or injuries sustained when you are carrying people such as a rideshare driver or goods like a pizza delivery driver in return for payment. This is because the risks associated with the liability and property damage are too high.
What’s in Your Truck?
Driving to the office every day isn’t a big deal. But carrying around heavy equipment or ladders is an entirely different scenario. A ladder flying off the back of a truck can cause much more damage than the average commuter, or a contractor with all of his tools in his truck is riskier due to theft, these are the type of scenarios a commercial auto policy was designed to cover.
The Reason You are Driving, while there is no limit on how much you drive, but the reason you are driving is significant to the insurance company. If you are a rep that visits and transports clients, you are posing a high risk to your company if you are in an accident, and a commercial auto policy would be the best way to cover that.
When to Buy a Commercial Auto Policy
Are any of your autos used for as a rideshare, limousine, taxi service, or other livery services?
Are any of your autos used for pickup or delivery of goods, including supplies, materials, newspaper, pizza, other food items, or for messenger services?
Are any of your autos registered or titled to a business, corporation, partnership, or DBA (Doing Business As)?
Are any of your autos owned or leased by a partnership or corporation?
Do any employees or non-listed drivers drive any of your autos on a routine or occasional basis?
Are any of your autos a pickup, van, or utility vehicle with a gross weight exceeding 10,000 pounds, or do any of your cars have a rated load capacity of over 2,000 pounds?
Are any of your autos leased or rented to others?
Are any of your autos equipped with snowplowing equipment, cooking or catering equipment, bathrooms, altered suspensions, hydraulic lifts, or racing equipment?
Do any of your autos have equipment installed like ladder racks or permanent toolboxes that are used to support a business?
If you can answer yes to any of the questions above, you should consider buying commercial auto insurance. It’s not as expensive as you may think. Contact us today for a fast and easy commercial auto insurance quote. Or call our Bridgeview or Chicago location at (708) 233-4848.