What Does Business Use Mean On Car Insurance?

When buying car insurance, you may come across the term "business use" and not understand what it means. This can be confusing as many people do not use their car for business, but in certain circumstances, business use can apply to you.

Business use of a vehicle is when an employee, business partner, or director of a company uses their vehicle for company purposes. This could be for travelling to meetings, delivering goods, or visiting clients, for example. If you are self-employed and use your car for business activities, then this also constitutes business use.

Do I need business car insurance?

If you require business car insurance depends on what you use your car for. If you are self-employed, a company director, or use your car for any business activities, then you will need business car insurance. This is because your car may be at greater risk than if you only use it for personal purposes.

What type of insurance do I need?

The type of insurance you need depends on the type of business use. If you are self-employed and use your car for business purposes, then you will need a policy that covers social, domestic, and pleasure (SDP) use, as well as business use. However, if you are a company director, you will need a policy that covers business use only.

In addition, you may also need extra cover depending on the type of business use. For example, if you are delivering goods, then you may need goods in transit cover. If you are carrying passengers, then you may need public liability insurance.

What is the difference between business and commercial car insurance?

Business car insurance is designed for those who use their car for business purposes, but not for hire or reward. Commercial car insurance is designed for those who use their car for hire or reward, such as taxi drivers, chauffeurs, or couriers.

It is important to make sure you have the right type of insurance for your business use. If you do not, then you may not be covered if you have an accident or your car is stolen.

Conclusion

In conclusion, business use of a vehicle is when an employee, business partner, or director of a company uses their vehicle for company purposes. Whether or not you need business car insurance depends on what you use your car for, and the type of insurance you need depends on the type of business use. It is important to make sure you have the right type of insurance for your business use, as you may not be covered if you have an accident or your car is stolen.