When Does Commercial Auto Insurance Cover Personal Use?

If you own a business, you will likely need commercial auto insurance. This insurance is crucial for keeping commercial vehicles safe both on and off the road. It is primarily designed to cover vehicles used for work purposes, but there are some exceptions.

Commercial auto insurance can cover certain commercial cars that a driver uses for personal business. However, conditions are attached to many policies where they won’t cover all vehicles used privately. This is particularly true when someone uses their personal car not only to do business but also during their free time. 

What is Commercial Auto Insurance? 
Also called business auto insurance, this coverage insures vehicles owned or used by a business, the driver who operates on their behalf, and the business itself. The coverage usually offers significantly higher coverage limits and tailored protection to these vehicles, because should a wreck occur, then a business stands to lose a lot of money from the accident. Coverage may include:

Coverage can apply to: Vehicles owned and used by a business, such as delivery vans

The reason coverage can apply when someone uses a car privately is because, first, everyone has to have car insurance, per the laws of most states. Second, standard car insurance won’t apply to commercially-driven or commercially-owned vehicles.

However, depending on how a vehicle driven personally falls into this chain of command, a driver’s commercial auto insurance coverage might or might not apply.

Who is Covered Under Commercial Auto Insurance? 
Commercial vehicles are generally owned by a business owner, who is the primary insured on a commercial auto insurance policy. Both the business and the business owner will be covered under this policy. The policy will likely cover permissive users, as well, who are typically employee drivers who have the business owner’s consent to operate the vehicle.

This means that when the employee drives this vehicle in their off-hours, then the business’s commercial auto insurance will continue to apply.

Just because the employee is driving off the clock, they are still driving a vehicle that represents the business. Any wreck might lead to damaging costs Plus, the business’s commercial auto coverage is likely the only policy that applies to this vehicle, regardless of when you use it. Therefore, using this car during your off-hours will guarantee that you have all the coverage necessary to protect the vehicle.

Does Commercial Auto Insurance Cover Personal Vehicles? 
Perhaps the business provides an employee with a car, with the express permission that this is both the driver’s personal and business car. Therefore, the commercial auto policy will usually insure them in the vehicle, wherever they go. However, drivers might need to obtain permission from the employer before they travel on certain business, or certain places.

However, when an employee drives their car, that they own alone, both for business and pleasure, they may not have coverage for this car during their private time under the employer’s policy. Your personal vehicle is your car. Therefore, if you have a wreck on the weekend when you aren’t working, your employer probably has nothing to do with your wreck. Therefore, to insure you during these times, you will need to maintain a private car insurance policy.

Keep in mind, if you use your personal car heavily for business, you can still buy an individual commercial auto policy. For example, if you work from home, are a sole proprietor, or drive your personal car for business the majority of the time, then you will likely benefit from having this coverage.

If you are unsure about the coverage you need or whether you qualify for commercial auto insurance, be sure to speak with an insurance agent about your policy.