It’s always important to discuss the use of your vehicle with your broker to ensure you’re insured properly in the event of a claim. Remember that all material changes in risk must be reported to your insurance company. If you started your policy out using your vehicle to commute to and from work, but have recently changed occupations where you have to use your vehicle for client meetings or transporting goods, be sure to let your broker know. Failing to do so can result in the insurance company denying your claim, which nobody wants! Whether you’re using your vehicle for business or commercial use, we have a plethora of companies that can insure you based on your specific needs.
Sounds simple enough, but what’s the difference between business and commercial use? Let’s have a closer look…
Business Use
Business use includes (but is not limited to) using your vehicle in pursuit of your occupation or profession. This includes carrying items used on your job (paperwork, laptop, samples, etc…), but not supplies. Examples of a business use classification would be a lawyer driving his own car to client meetings, a realtor driving her own vehicle to home showings, etc…
Commercial Use
Commercial use includes (but is not limited to) using your vehicle to transport tools and materials to your place of employment or site, or any type of delivery. Examples of a commercial use classification would be a contractor going to her site, a florist delivering his floral arrangements, etc…
What about Contracted Ride Sharing or Food Delivery?
Insurance companies have varied requirements for Ride Sharing (such as Uber, Tap Car, etc…) and Food Delivery (such as Uber Eats, Skip The Dishes, etc…). Some companies allow you to use your vehicle for Ride Sharing or Food Delivery, providing you have a separate policy in place to cover you while your vehicle is being used for said purposes. Other companies will not cover you if you use your vehicle for these purposes—even if you’re involved in a claim while driving for personal use only (to the grocery store, gym, etc…). Be sure to review your contract with the Ride Sharing Company or Food Delivery service and always call your broker before diving into any endeavor. Making a few extra dollars is nice, but it could cost you so much more in physical damages, liabilities or injuries if you fail to report your new business venture to your insurance company—don’t risk it.
The world of insurance can be a scary place, but remember that your friendly Ravenhill broker works for you and is always ready and willing to help navigate the process. Contact us today!
Sincerely Elizabeth Brodyk
FAQs
Examples of a business use classification would be a lawyer driving his own car to client meetings, a realtor driving her own vehicle to home showings, etc… Commercial use includes (but is not limited to) using your vehicle to transport tools and materials to your place of employment or site, or any type of delivery.
What's the difference between business and commercial insurance? ›
Commercial insurance (also known as business insurance) is an insurance product that protects you from any unforeseen problems that could affect your business. Commercial insurance protects both the business owner and their employees from risks of injury, business interruption, and other risks.
Is there a difference between commercial and business? ›
Business vs Commercial
Business is more general, referring to a process of setting up an organization designed to provide goods or services to the public. Commercial entities are a subset of businesses, specifically those that exist to make money—usually through the exchange of products and services for payment.
What does it mean to use a vehicle for commercial use? ›
A “commercial vehicle” is a vehicle which is used or maintained for the transportation of persons for hire, compensation, or profit or designed, used, or maintained primarily for the transportation of property (for example, trucks and pickups).
What qualifies as commercial use? ›
Commercial use is any reproduction or purpose that is marketed, promoted, or sold and incorporates a financial transaction.
What are examples of commercial use? ›
Commercial uses means those activities involving land used for retail, office, and marina condominiums; wholesale trade; retail trade in building materials, hardware, or farm equipment, in general merchandise, in food, in automobiles, tires, marine craft, aircraft, and accessories, in apparel and accessories, in ...
Is insurance more expensive for business use? ›
Commercial policies are designed to provide coverage for the increased risks that arise from a business' daily operations. This type of insurance is typically more expensive than personal auto because of the higher liability coverage it provides.
What is covered under commercial insurance? ›
Commercial insurance can protect you from some of the most common losses experienced by business owners such as property damage, business interruption, theft, liability, and worker injury.
What makes an insurance commercial? ›
Commercial health insurance, also called private health insurance, is coverage issued by a private company or entity. It is not from government-issued insurance like Medicare or Medicaid. Commercial health insurance companies include: Aetna.
What is meant by business use? ›
Business use . - means uses that provide products or services for profit, inclusive of industrial and commercial uses, but not inclusive of residential or institutional uses.
'Business' banking generally refers to the services used by smaller companies, including sole traders. 'Commercial' or 'corporate' banking generally refers to the services used by larger enterprises with a high turnover.
What is the difference between business and commercial terms? ›
Commercial law focuses on the sale and distribution of goods and transaction financing. Business law focuses on the legal needs of forming a company and property issues such as leasing office space. A business that sells products will need a lawyer with experience in both fields.
What is defined as business use for a vehicle? ›
Business use generally means travel between two business destinations, one of which may include your regular place of business. Typical trips that are deductible include: travel from one job to another. travel from one customer or client to another.
What is non-commercial use for a vehicle? ›
Non-commercial vehicle means a vehicle that is not carrying passengers or goods for consideration; Sample 1.
Is a 3500 truck considered a commercial vehicle? ›
On the Chevrolet website, the following vehicles are listed under Commercial: Colorado, Silverado, Express Vans, Express Cutaway, Silverado HD, Silverado 3500 HD Chassis Cab, Low Cab Forward, and Silverado 4500 HD/5500 HD/6500 HD. All of these models are appropriate for various jobs.
What does commercial use exactly mean? ›
Commercial use is a legal term that defines the use of certain merchandise, tools or intellectual property for financial gain.
What is commercial or business purposes? ›
Commercial Purposes means any commercial or profit generating purpose including the sale, lease of other transfer of the Material and includes uses of the Material by any organisation, including Recipient, to perform contract research, to produce or manufacture products for general sale, or to conduct research ...
What is the definition of business use on a personal auto policy? ›
Business use may mean towing a work trailer, moving inventory, and making extra trips that would otherwise not be performed. A business auto policy is designed to protect businesses for this increased use of the vehicle as well as other business-specific coverage needs.
