Commercial auto insurance protects your company if an employee driving a company vehicle is involved in an accident, and someone makes a claim against your business. It can also help with legal fees and the medical costs of others involved in the accident. Nevertheless, what about the personal use of these vehicles? Will commercial auto insurance cover it? Yes, commercial auto insurance can provide coverage even if the vehicle is used for personal activities outside its primary business use. Are you wondering how? Read on to find out.
Commercial vehicle insurance covers any vehicle owned explicitly by the business, such as delivery trucks or company cars. This means it does not cover employees who use their vehicles for work purposes. This policy protects against damages and losses related to accidents and includes coverage for theft, vandalism, and third-party medical expenses. Hired and non-owned auto liability insurance covers businesses that do not own any vehicles but may occasionally rent or borrow vehicles for work-related purposes. This policy protects against liability claims from accidents caused by hired or non-owned vehicles.
Businesses owning vehicles should have commercial auto insurance to protect against accidents, collisions, vandalism, theft, and natural disasters.
For example, the following businesses may require commercial auto insurance:
So, commercial auto insurance for personal use protects individuals who use their vehicles for activities beyond the scope of normal personal usage, such as transporting goods, ridesharing, or delivery services.
CF&P Insurance Brokers is ideal for all your commercial auto insurance needs. With us, you can rest assured that your vehicles and drivers are protected against unforeseen events. Contact us today for a customized policy that fits your budget and offers comprehensive coverage. You can also call us directly at (925) 956-7700.
What Are the Main Differences Between Personal and Commercial Auto Insurance?
Personal auto insurance covers vehicles primarily used for personal purposes, such as commuting or running errands. Commercial auto insurance is tailored specifically for vehicles used for business purposes, providing coverage for several business-related activities, such as transporting goods or employees.
Can You Use a Business Car for Personal Expenses?
Some commercial auto insurance policies may provide limited coverage for personal use, while others may require you to purchase additional coverage or have a separate personal auto insurance policy for such purposes.
How Do You Calculate the Personal Use of a Business Vehicle?
Using the cents-per-mile method, the employee’s vehicle usage is calculated by multiplying the number of personal miles driven by the IRS Standard Mileage Rate (65.5 cents for 2023). This rate includes the cost of insurance, fuel, and maintenance.
What Is the Definition of Personal Use of a Vehicle?
Generally, personal use refers to any non-business-related utilization of the vehicle, including commuting to and from work, running personal errands, or trips for leisure purposes.