Determining whether to purchase commercial vs personal auto insurance is not always easy. Answering these three questions may help.
1. How Do These Types of Policies Differ?
Commercial auto insurance policies are designed differently than personal auto insurance plans. A personal policy is written for a specific driver. The driving record of that person is among the factors considered when determining the cost of the premium. A commercial policy covers vehicles used for the company’s business purposes and may not specify a certain driver.
2. Who Is Driving the Vehicle?
If an employee is driving a car owned by a business, it is likely that a commercial policy is needed. This could also be the case if the driver is a sole proprietor of a small business or an independent contractor who uses the vehicle for work.
3. What Is the Purpose for Using the Vehicle?
Vehicles used for business-related tasks typically require commercial coverage. For example, an owner who uses the vehicle to drop off supplies to a job site may require commercial coverage. Personal auto insurance will typically only cover the commute to work.
If a business or individual is unsure whether they need commercial or personal auto insurance, it is usually best to ask an insurance company for assistance.