Using your car for business

Generally fine on a personal policy

• Commuting to and from a regular workplace
• Occasional trips to a client or a meeting
• Carrying your own tools between jobs, in many cases
• Errands during the working day

Commonly excluded

• Delivery of goods or food for payment
• Carrying passengers for a fee
• Using the vehicle as a taxi, livery or courier
• Hauling for hire, or towing commercially
• Employees driving your vehicle for the business
• A vehicle titled to a business rather than to you

Where the grey area sits

Trades, real estate, home services and consulting all involve driving that is neither pure commuting nor delivery. Insurers handle this with a use classification — pleasure, commute, or business — and by asking about the specifics.

The right move is to describe what you actually do and let the insurer classify it. Business use often costs modestly more on a personal policy, and it is dramatically cheaper than an uncovered claim.

When you need commercial coverage

• The vehicle is titled to a business
• Employees drive it
• It's used primarily for the business rather than incidentally
• It carries commercial signage, equipment racks or modifications
• You need higher limits than a personal policy will write
• A contract or client requires evidence of commercial coverage

Hired and non-owned auto

If your business uses vehicles it doesn't own — employees driving their own cars for work, or rented vehicles — a personal policy doesn't protect the business, and the business can be pursued.

Hired and non-owned auto coverage addresses that, and it's frequently missing from small business insurance. Worth asking about specifically if anyone drives on your behalf.

What happens if you get it wrong

Outcomes range from the claim being paid with the policy re-rated, to a denial for a use excluded by the contract, depending on the facts, the policy language and the state.

The cost of asking beforehand is a slightly higher premium. The cost of not asking can be the whole claim.