Do You Use Your Own Vehicle for Work? Read This!

If I drive my own car to work, does this affect my insurance?

There are more than two million vehicles that use the public roads in the United States. There will be some vehicles that are being used for work, given the high number of registered vehicles. It is estimated that 1 out 4 vehicles are used for business purposes.

These people might use their vehicles to make deliveries, visit clients, or perform other tasks. There are still many people who use their vehicle to commute to work every day, even though they don’t use it for business purposes. What about personal auto insurance?

This question doesn’t have a simple answer. There are grey areas in insurance that can make it difficult to decide. This question can be answered by looking at your circumstances. Consider your business type, what kind of car you own, and how often you drive it.

This may bore you. However, you should really take a look at the contract language in a personal auto policy (also known as PAP). Surprised to discover that personal auto policies exclude all business activities, except farming and ranching. If the vehicle is one of these types, then the standard PAP will provide some coverage for business use.

  1. Private Passenger Autos
  2. Vans and pickups
  3. Trailer used in conjunction with the vehicles pictured above

There are still some issues here as not all PAP contracts provide these coverages. PAPs may place limits on vehicle weight (Gross Vehicleweight) or other restrictions, such as the requirement that the vehicles be owned by the insured named on the policy. Before you drive any vehicle for work-related purposes, it is important to read and understand your policy.

We now know how PAP policies deal with business use of the three vehicle types mentioned above. Let’s now look at the other types of vehicles that aren’t allowed to be used in conjunction with personal auto policies.

Company cars – vehicles that are furnished or made available for regular use.

This is usually a car that the insured’s employer owns and you use while at work. These vehicles are not covered by a PAP unless they are specifically listed on the policy. If your employer offers you a company car as a benefit, make sure that you have auto insurance. You will need to make sure your company car is covered under your PAP. This will not happen automatically. It shouldn’t cost you much to add this coverage to your PAP. However, it is possible and easy to do. Don’t wait until it’s too late. When deciding whether or not your company car is covered, it’s best to be cautious. Even if the car isn’t used regularly and you don’t bring it home, it could still be considered “vehicle furnished or readily available for regular use”. Talk to your agent if you are still unsure about your situation.

Commercial Vehicles

This is a simple one. A commercial auto policy will not cover you if you are driving a commercial vehicle like a truck, tractor-trailer or bread truck, bus, passenger bus, or conversion vehicle. Flatbed pickup trucks are not covered by most PAP’s. Always check with your agent if you want to buy one.

The PAP will cover your personal vehicle while it is being used for business purposes. However, in certain situations, it may not. If you don’t take the necessary steps to obtain the right coverage, you could expose yourself and your family members to significant financial loss. Talk to your agent to learn more about how to avoid gaps in coverage.