When you run a business, you may need a business car insurance policy; this includes everyone who is self-employed or an independent contractor. A personal policy may not adequately cover you. Some may think, I have personal car insurance anyway so why pay a higher premium for business insurance. First off, it may not be as expensive. Secondly, it’s the right thing to do.
What happens when your insurance company finds out you have been using the vehicle for business use when you have a personal policy? The company may refuse your claim or cancel your policy In other words, it’s better to come clean.
Usually personal car insurance policy covers the insured and others who are not necessarily listed in the policy. Business insurance policy only covers those who are listed. If you have employees who will be driving your vehicle, make sure their names are listed. It’s also good to check the driving record of your employees. If they cause an accident, it will affect your business auto insurance rates
Bear in mind, you may not need a commercial driver’s license when you get business car insurance. It depends on the situation. You don’t need to get a CDL or other special type of license unless the vehicle carries 16 or more people and weighs more than 26,000 pounds (gross vehicle weight).
Other facts to remember: when getting business car insurance, many companies do not accept drivers younger than 25 or older than 74 no matter how good a driver the person may be. However, this rule can vary from company to company. It’s better to ask the agent about your specific situation.
In addition, business insurance policies usually allow much higher deductible compared to personal policies, another notable difference. While business auto insurance policies seem to be stricter, there are areas where the insurance company will provide more flexibility for your business.