If you have a home based business, you probably have to use your car at least occasionally for errands or deliveries. Your personal insurance is usually good coverage if you drive your car for business but only if you’re working for someone else. A home-based business is an entirely different animal for a lot of reasons.
Do You Need Business Insurance for Your Car?
You may have a home based business and not even realize it. If you work at home hours a day to make a profit, you obviously have a home based business. However, if you travel to job sites or make deliveries using your home as your office or base, this also qualifies as a home based business.
When do you need a policy that covers your car under a home-based business? If you need to drive clients to and from investment sites or property that they are thinking of buying, your personal auto insurance will probably suffice since the transportation you provide isn’t the main function of your business. If you make deliveries on a regular basis, though, you will need a commercial policy to cover your liability. In the first instance, transportation is an incidental means to an end whereas in the latter it is a major function.
When you use your personal vehicle for business purposes you are not only in danger of compromising your personal assets in case of an accident, you’re putting your business assets on the table as well. In this litigious society, someone is much more likely to sue you if you have a business than if you did not. Most people think a small business owner has a lot of real and financial assets and see an accident as an opportunity to better themselves. The sad fact is that most home based business owners are struggling just like everyone else! But if you don’t have commercial coverage for the car you drive for business, any claimants can try to strip you of your business and will probably succeed. By insuring your business you are protecting your future earnings as well as your current assets.
Spend More to Spend Less
Commercial auto coverage is a bit higher but you have more to lose, too. If you regularly haul expensive equipment in your car as part of doing business, commercial auto insurance would be a wise investment. It will usually cover up to $10,000 if equipment you’re transporting is lost, damaged or stolen and is not a permanently attached item of equipment.
A business owner’s policy on your car will cover property and liability risks both on and off your premises. As an entrepreneur who is trying to achieve financial independence, one of your most valuable tools is your insurance coverage. If you already have coverage on the car you use for business you might be able to save money by getting some online quotes. If you don’t have coverage, it would be wise to take advantage of it. By getting several online quotes you’ll be able to find the cheapest price for the best coverage to protect your business and your future.