Many of the insurance companies call auto insurance for business owners, commercial auto insurance. Other names for it include commercial car insurance or business car insurance. You can purchase a policy from the same company that also issues your personal car insurance policy or other major insurance, such as homeowners insurance. It covers what your personal auto insurance policy will not, which are claims that arise from you or your employees' business activities.
Why You Might Need It
It's not common for a work-at-home mom to need auto insurance for businesses, because most moms don't use their cars for business use often. You could be wasting money paying for premiums that you don't need. However, you may be one of the moms that should get it. Consider these examples for when you might need commercial auto insurance:
- You use your car to deliver goods
- Your personal car auto insurance doesn't have a high enough limit for the coverage you need
- You tow a trailer to trade shows or other business purposes
- You've registered the car in your business name and not your personal name
- Others use the car to carry out business activities, including family members
If you're not sure whether you should get business car insurance, then ask your insurance agent. Discuss the business activities you use the car for, and ask whether they are minor enough to be covered by your personal car policy. Some companies also offer an online tool to help you determine whether you need business insurance.
Features of Auto Insurance for a Business
The features of business and personal car insurance are similar. The only difference is the underlying activities that are associated with the claims that you might file. These features include:
- Medical payments for you, your contractors or other drivers
- Liability to cover property damage and other damages
- Coverage for cases where you collide with underinsured or uninsured drivers
- Employee coverage when they use your car
- Fast claim service
Some insurance companies offer coverage for seasonal business activities so that you don't have to pay insurance premiums the entire year. You may also receive special rates if you're starting a new venture.
Options for Insurance
You have options for auto insurance for your business, much like a personal car insurance policy. If you don't have any employees and your major concern is paying the bills for the other driver if there's an accident, then liability coverage may be all that you need. If you've purchased a new vehicle and equipment and don't have enough in savings to repair or replace it, then you might need to consider comprehensive coverage. You should always consider getting comprehensive coverage if you plan to let employees operate your business vehicle.
Start with your insurance company when you're shopping for auto insurance for your business. Most companies offer a multi-car discount, which means you'll save money on premiums.
Daphne Mallory, Esq. is the co-owner of Mallory Writing Services and has written more than 100 articles helping home based business owners and entrepreneurs start and market their business. You can learn more about her here.