Why Your Personal Auto Policy Won’t Cover Business Use of Your Vehicle

Many drivers assume their personal auto insurance covers all uses of their vehicle. However, once a car is used for business purposes, such as making deliveries, transporting tools or meeting with clients, it often falls outside the limits of a personal policy. This can lead to denied claims and unexpected financial responsibilities.

Why Won’t Personal Auto Insurance Cover Business Use?

Personal auto policies are designed for day-to-day driving, such as commuting to work, running errands and taking road trips. They don’t account for the demands of business use. For example, a delivery driver may visit dozens of locations daily, increasing the chance of accidents. Insurance companies see this as a higher level of risk, and standard personal policies aren’t priced or structured to absorb those risks.

How Does Personal Auto Differ From Commercial Auto Insurance?

The following are some key differences between the two types of coverage:

• Personal auto usually covers nonwork-related driving. Commercial policies may cover business activities like transporting goods or visiting clients.

• Personal insurance is usually for private cars. Commercial policies may include trucks, vans and vehicles modified for work purposes.
• Commercial policies usually offer higher liability limits to account for potential claims arising from business activities.

Understanding these differences may help avoid surprises and keep your operations moving smoothly. If you’re using your car for more than personal errands, it may be time to explore other coverage options.

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This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.