Do I Need Commercial Vehicle Insurance If I Use My Personal Car for Work?

The answer to the question of whether you should get commercial vehicle insurance if you’re using your personal car for work isn't as simple as it may seem. Yes, it’s true that you have personal auto insurance for your car. But then it may not be enough. 

Let’s clarify one thing first. We aren’t talking about using your personal car to get to and from your workplace. Obviously, millions of people do just that and most of them don’t need commercial vehicle insurance at all. But if we’re talking about using your personal car to help with your work, it’s a different matter entirely.

Why Your Personal Auto Insurance May Be Inadequate

What you first have to understand is that your personal auto policy comes with the understanding that you’re using your car mainly for personal reasons. You use it to drive yourself to work, to the mall and grocery, to your various entertainment spots, and to your friends’ houses. You may even use it to travel across the country. You’re still covered.

Commercial Vehicle Insurance

But for the majority of personal auto policies, the automobiles driven mainly for a business are specifically excluded from coverage. So if you use your vehicle to deliver pizza for your pizzeria, then if you get into an accident you may be on your own in covering the liability.

The same goes for vehicles that are owned by a business, and not by you. If the business owns the vehicle, then insurance must be bought on behalf of the business and that will generally be dealing with commercial insurance.

Some types of vehicles may also automatically require commercial insurance because of their design. Food trucks, delivery trucks, tractors, and shuttle buses may all need commercial insurance, because they’re classified mainly as commercial vehicles.

If you want to be sure that your personal auto policy covers your car even when you use it for your business, you may want to discuss the matter first with your insurance agent. They can then clarify matters for you.

Beyond the Limits of Your Personal Auto Insurance

If your insurance agent says that you’re using your car too often for business so it needs commercial insurance, then you have no choice but to get one. But even when your personal auto policy covers the use of your car for business, you still may need additional coverage.

Let’s say that you’re just on your personal policy, and you get into an accident while you’re delivering your pizza. The personal policy will then pay for the damages to the other party’s car and for the expenses brought on by the other people’s injuries. But your personal policy will have some limits, and often they’re not enough to cover the entirety of the hospital expenses.

The other party can then sue your business so that it will be liable for the damages beyond the limits of your personal policy. You may end up bankrupting your business to pay the damages.

When Do You Need Commercial Insurance for Your Personal Vehicle?

It may be more sensible for you to obtain commercial insurance even when you already have personal insurance, if the following situations pertain to you:

  • Your business owns the vehicle. That explicitly makes your vehicle a company car, and personal policies don’t cover company cars in general. You’re basically driving around without insurance if you don’t have commercial insurance.
  • You frequently use your car for your business. That should protect your business from suits for damages when they exceed the limits of your personal policy. 
If you’re the employee, then it’s not a good idea at all for you to drive (and depreciate) your car for the business. It’s only a good idea if the company will also pay for its commercial insurance. If a car is needed for your job, then let the company provide you with a car—and the company will pay for the commercial instance for it too. 

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