May 20, 2011

The Major Differences Between Commercial And Private Car Insurance Policies

On the surface, commercial car insurance and private car insurance are similar. Both provide liability, collision, bodily injury and medical coverage. However, if you own a business, it is important to recognize the difference between commercial and private policies. Commercial insurance offers protection to business owners that are not offered in a private insurance plan. Learning about the difference between these two types of insurance can help you determine whether you are getting the coverage you need or if it is time to switch over to a commercial insurance plan.

When to Purchase Commercial Insurance

If you own a large-scale business, the importance of commercial insurance goes without saying. For freelancers, small business owners and independent contractors, the need for commercial insurance is less obvious. Because many small business owners use their personal vehicles to conduct daily business, it is easy for the lines between business and personal use to become blurred.

You should consider commercial insurance if you use your car for business more than 50 percent of the time. Keep in mind that if your insurance company determines that you have been misrepresenting the use of your vehicle, it could cause your claim to be denied in the case of an accident.

Protecting Your Property with Commercial Coverage

For many businesses, the equipment and supplies they purchase are their most valuable assets. Losing important supplies can set you back significantly and even force you to go out of business. If you are transporting your equipment in your car, you should consider getting commercial coverage. Private insurance will not cover the cost of your equipment if it gets damaged in an accident. A commercial car insurance policy will help you recover your losses after the accident and just may save your business.

The Right Insurance Keeps Passengers Safe

When we think of professionals who need commercial car insurance, limousine drivers and taxi drivers are usually the first to come to mind. This is because many business owners are responsible for other passengers when they are operating their vehicle. However, all business owners are obligated to look after their passengers when they are driving. Even if you have one passenger in your car, you will need a commercial policy to protect that person in case of an accident.

If you use your car for commercial purposes, it is important to get coverage that will cover your property and your passengers when you are using your car to conduct business. If you have an accident while driving for business purposes, your private car insurance may leave you to pick up the bill. Finding the right commercial car insurance policy can protect your business and save you money in the long run.