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Do you use your car for work? If you drive to different locations as part of your job, you’ll need to have business car insurance.
This type of insurance gives you extra cover compared to a standard car insurance, and will ensure your vehicle is covered at all times.
What is business car insurance?
You need business car insurance if you drive your own car for business reasons as part of your employment.
Business reasons might mean:
- driving to business meetings
- travel between your company’s different sites or offices
- journeys to clients’ premises
- giving colleagues lifts to anything work-related
- driving to work-related conferences or events
- carrying out errands relating to your job
Who needs business car insurance?
You need business car insurance if you use your car for work-related purposes.
You might use your own car for business use if you’re employed, or if you’re self-employed.
However, you don’t need business car insurance if you just use your car for commuting to and from work.
What is commercial car insurance?
It’s important not to get business car insurance confused with commercial car insurance.
Commercial car insurance is for vehicles where driving is a key part of the job role. For example, you might be an Uber driver, delivery driver or driving instructor. Taxi drivers can also take out specialised taxi insurance.
What is company car insurance?
If you have a company car provided by your employer, you won’t need business car insurance. This is because your car should be insured by your company – but double check just to be on the safe side.
How do I get business insurance quotes?
When you get a quote for car insurance, the insurer will ask what you’re going to be using your car for. It’s important to answer this question honestly as otherwise you may find your policy won’t pay out in the event of a claim.
The car insurer will normally give you three options:
- social, domestic and pleasure (SDP)
- social, domestic and pleasure, and commuting (SDP & C)
- business use (SDP & C and business use)
If you choose business use, most insurers will ask you more questions about it. Your answers will mean your cover normally falls into one of the following three categories.
- Business Class 1: This covers traveling to another offices or sites, to meetings, or running work errands (i.e. taking cash to the bank).
- Business Class 2: This covers everything in Business Class 1 but also allows you to add a named driver who can do the same.
- Business Class 3: This class of cover is designed for people who travel frequently between business locations. For example, you might be a field-based sales person.
Is business car insurance expensive?
Adding business use will affect your car insurance premium.
This is because people who use their cars for business typically drive more miles than other drivers – and this driving is likely to be on busier and possibly unfamiliar roads.
All these factors mean you are more likely to be involved in a car accident and make an insurance claim. If you’re seen as more likely to make a claim, your insurance premium will cost more.
How much business car insurance costs will depend on:
- the make and model of your car
- the nature of your business use
- how many business and social miles the car will do
- who will be driving the car
- where you live
- where you park your car overnight
- your claims history and driving record
- your occupation.
If you drive for business purposes, don’t be tempted to omit this information when you apply for car insurance.
If you only have SDP or SDP plus commuting cover and you have an accident, you might find you’re not covered. Not only will the insurance not pay out, but non-disclosure could be classed as a criminal offence and make it very difficult for you to buy insurance in the future.
How can I find the best business car insurance?
You should shop around for quotes from different insurers before buying business car insurance. You can do this by contacting insurers individually or by using a price comparison service.
To save money, you should buy a car in a low insurance category and make sure it has approved security features such as an alarm or immobiliser.
How much you pay for business car insurance will greatly depend on your driving history. The cheapest cover is offered to people who haven’t made many, if any, claims on their car insurance before.
You can also reduce the amount you pay by keeping a clean driving licence.
