When Do You Need Business Car Insurance?

If you use your car for work, like driving between different locations or visiting clients, you may want to consider getting business car insurance. When we talk about driving for work, we don’t mean your commute, but how you use your car during work hours. 

You may use your car a lot at work – maybe more than you think – and if this is the case, business car insurance might be a good option. The price of business car insurance is understandably higher than standard car insurance, however.

When applying for a car insurance quote from us, you must explain exactly how you’ll be using your car so we can provide you with the best business car insurance plan to suit you and your lifestyle. Failure to do so could leave you driving on the road uninsured, so it’s best to look into car insurance now if you haven’t already.

The Different Types Of Business Car Insurance

Like all specialised insurance types, there are several tiers to business car insurance. How you go about insuring your car for business purposes depends on your line of work and the specific uses of your vehicle. 

The main types of business car insurance include:

Social and commuting cover

If the only business-related use you have for your car is driving to and from work, all you’ll need is social and commuting cover. This level of cover is also necessary if you use your car only for part of your commute. For example, if you drive to and park your car outside the train station, you also need social and commuting cover.

If you drop someone else off at work regularly but don’t use your car to commute yourself, social and commuting cover will also be applicable.

The social aspect of this cover refers to everyday car use, from driving to the supermarket to picking up the kids from school.

Social and commuting cover is not to be confused with social, domestic, and pleasure cover (commonly referred to as SD&P). This level of insurance covers you for all everyday car uses but not any work-related commuting.

Business Class 1

For general work-related driving, you’ll need Business Class 1 insurance. Generally, this pertains to any driving done between one or more locations. For example, if you work primarily in an office but are required to make on-site visits in various locations, you’ll need Business Class 1 insurance cover.

As with all levels of business class insurance, Business Class 1 automatically covers you for social, domestic, and pleasure car uses. Additionally, it also covers your commute to and from work.

Some examples of who would need Class 1 business insurance include:

• An estate agent who drives between different home viewings.
• A social worker who needs to drive to make home visits.
• A self-employed plumber who drives to different jobs.
• A guitar teacher who drives to students’ homes for lessons.
• A nanny who takes children on day trips.

Business Class 2

This type of business car insurance covers everything from Business Class 1, but the main difference is that you can also enlist a named driver with Business Class 2.

This tier of car insurance is necessary if you drive a lot during business hours and have a co-worker or employee who also drives the same car on a regular basis. This legally allows your co-worker or employee to use your car for business purposes when you’re not driving it.

As with all named driver policies, Business Class 2 insurance only grants driving permission to the driver named in the policy. It does not mean you can allow any employee or co-worker to use your car. In this case, they would be driving uninsured.

Instances where Class 2 business car insurance cover would be applicable include:

• A carpenter who allows their assistant to take over the wheel when commuting to clients who live far away.
• A commercial landlord who allows a chosen employee to drive to an owned property for repairs or other work.

Business Class 3

If your job requires you to be on the road more than off it, you’ll probably qualify for Business Class 3 insurance. While Business Class 1 is recommended for driving to and from one or two clients per day, Business Class 3 is more suitable if you are constantly visiting new clients throughout the day.

Class 3 is sometimes referred to as ‘commercial travelling car insurance,’ and unlike Business Class 2, Class 3 car insurance does not allow you to select a named driver.

Examples of who would require Business Class 3 insurance include:

• A door-to-door salesperson. Anyone whose business requires them to go door-to-door selling products on a daily basis would need Business Class 3.
• A building inspector who drives between different sites multiple times a day.

Can You Get Temporary Business Car Insurance?

Yes, you can get temporary business car insurance coverage. There’s one problem with paying for an annual policy – what if you only use your car for business purposes once a month or a few times a year?

If you were to use your car for business purposes, even once a month, and you don’t have business insurance, you would still face the consequences if you were involved in an accident. Even if you occasionally need your car for business purposes, you still need business car insurance to stay protected.

But fear not; this is where temporary cover business insurance comes in. If you only require business car insurance for a short trip, you can arrange temporary business insurance for a couple of hours. Alternatively, if you’re using your car for several business-related reasons over a month, you can get month-long temporary business car insurance.

What Is Commercial Vehicle Insurance?

Commercial vehicle insurance is necessary when your vehicle plays a fundamental role in your business. This goes beyond driving to and from different locations; it provides cover for when your car is your business.

You’ll need commercial insurance for the following professions:

• Ice cream van owner
• Food truck owner
• Service utility truck owner
• Driving instructor

Is commercial vehicle insurance necessary for company cars?

If you drive a company car, you shouldn’t have to take out commercial car insurance – or any other form of business car insurance, for that matter. If a company car is provided as part of your job, your employer should already have business car insurance arranged for the vehicle.

The Different Levels Of Business Car Insurance

Not only do you get different types of business car insurance, but for each type, you can also choose a specific level of coverage. The degree of cover reflects what the insurer will pay in the event of a road accident or other situation where damage is caused to you and your vehicle. The different levels of business insurance are:

Third-Party Only (TPO)

TPO business car insurance covers the cost of damages to other vehicles and pays for expenses related to injuries sustained by third parties. It is the most basic level of cover on offer – and 100% essential to have. If you need business car insurance, you need TPO cover at the bare minimum. However, we recommend going at least one step higher to protect you and your car.

Third-Party, Fire and Theft (TPFT)

TPFT provides you with everything that TPO does, plus additional coverage to protect your car from damage. Specifically, TPFT will cover costs associated with damage caused by fire and theft.

Comprehensive

Fully comprehensive business car insurance will cover damage or injury caused to third parties, damage to your car as a result of a fire or theft and personal injury or car damage caused in a road accident. This is the most comprehensive insurance type available regarding business use car insurance.

What Impacts The Price Of Business Car Insurance?

The type and level of insurance you buy will roughly define your business car insurance cost. However, the final cost depends on several factors unique to your job. These factors include:

• Your equipment and goods – The more expensive your equipment is, the higher price you can expect to pay for business car insurance.
• The routes you take – This will indicate the kind of roads you’ll be driving on and how long you’ll spend on the road, which allows us to assess all potential risks.
• The type of work you do – Your specific job role will also impact the price of your insurance.

As always, your driving history, the type of car you drive, and whether or not you have a no-claims discount will also impact the total price of the business car insurance policies available to you.

FAQs

Is business car insurance cover a legal requirement?

If you use your car for business purposes, you are legally required to have at least Third-Party Only (TPO) business car insurance. Regardless of how often or how little you use your car for business, you need to ensure you have the correct coverage level before using your car for work.

Does business cover cost more than standard car insurance?

Due to the increased risks, business coverage tends to cost more than standard car insurance. Work-related driving may see you on the road more often, and you will potentially drive longer distances. Therefore, driving for work-related purposes increases your chances of being involved in an accident.

Discover Temporary Car Insurance From GoShorty

At GoShorty we’re all about making sure you’re safe on the road. It’s important to keep yourself protected from any accidents, which is why our fully comprehensive temporary car insurance is great for those looking for short-term cover. 

From hourly temporary car insurance to monthly temporary car insurance, you’ll receive flexible cover for however long you require. Visit our website today to find temporary car insurance to suit you.