Do you run a small business where you drive a utility vehicle (ute) for work? Maybe you run a courier company where you have multiple vehicles that are used in the business. Whether it’s just your vehicle being used in the business, or you have a fleet of vehicles, you need to ensure all the vehicles are properly insured. Most insurance providers offer two types of car insurance for business – business car insurance and commercial car insurance. While business car insurance is ideal for small businesses where the same car is used for business and personal use, commercial car insurance is better for vehicles engaged in heavy-duty work or companies with a fleet of cars.
When do I need commercial car insurance?
Commercial car insurance is best suited for businesses or individuals that require vehicles for heavy-duty work. This work includes things such as moving materials, tools and equipment between different work sites. It also includes towing or earth moving, transporting goods, and visiting clients and customers to deliver goods in multiple locations. This kind of insurance is suitable for vehicles that are meant to perform these specific work tasks, such as a ute, cement truck, trailer or similar type of vehicle.
Commercial vehicle insurance is also a natural choice if you have to insure a fleet of vehicles. Or if you need to protect yourself against loss of income in case your vehicle breaks down. If your vehicle often carries a lot of expensive products, tools or equipment, commercial car insurance can give you protection against the loss or theft of those as well.
How many types of commercial car insurance are available?
Commercial car insurance has two types you can choose from depending on your business requirements. One is commercial motor insurance which covers individual business vehicles against damage, theft and legal liability. The other is commercial motor fleet insurance which, as the name suggests, covers multiple business vehicles.
As a business owner, you can take out commercial motor insurance on your company vehicle. But for commercial motor fleet insurance, you must own or lease a certain number of vehicles, with most insurers requiring around 15.
What does commercial car insurance cover?
The kind of cover you can take out will depend on what you actually use the vehicle for, and the possible liabilities or damages you could face.
Public liability insurance offers you protection in case you injure someone or damage someone's property. This type of cover is typically a requirement of any policy and can help you evade thousands of dollars in damages.
Do you carry work equipment such as computers, tools, cameras or other work equipment in your vehicle? With portable equipment insurance, all of this extra equipment will be protected against theft and damage when in the vehicle as well as at the office and worksite too.
Personal accident insurance
An accident can happen any time, and if it does, it can leave you injured and unable to do your job temporarily. With personal accident insurance, you’re protected from loss of income and offers a source of income until you recover.
What is the price of commercial car insurance?
When it comes to the cost of commercial car insurance policies, they can differ from personal car insurance policies due to the commercial nature of the insurance. How much commercial car insurance costs depends on the type of policy and coverage you choose. Typically policies range from legal liability to third party fire and theft up to full commercial coverage.
A basic policy would cover your businesses legal liability and not much else. A third party fire and theft policy will usually protect you against liability for damage to other cars in an accident if you’re at fault. It will also cover your car for damage from fires and theft.
If you have lots of tools, equipment or other items of value to your business, you could also add coverage for these items when stored in your car. Insurers will require you to confirm the value of items you’re wanting to be covered on top of the actual vehicle itself. If the nature of your work exposes your car to possible damage, your insurer may charge a higher premium.
How do I buy commercial car insurance?
If you’re looking to purchase commercial car insurance, Australia has strict rules about its purchase. Unlike all other types of insurance which you can buy online, you can only buy commercial car insurance through a licensed broker. Since these insurance policies are more expensive and for business purposes, there is more money at stake. This means that professional advice goes a long way in securing the right insurance cover.