Being own boss may sound great. However, it also means that you need to monitor things closely and make appropriate decisions to safeguard your financial wellbeing. You will need to sort out health, premises and vehicle insurance and avoid a catastrophic failure due to an unforeseen but protectable event. Essentially, it may require a bit more consideration as to how much a private auto is required in day to day activities.
Auto Insurance for Self Employed
It can be tricky when you are the boss and you don’t know when social life finishes and job takes over. A few of them own only one car. Even if you have two separate vehicles it isn’t like a hat that you can take one off and put the other.
There may be times you go for job related errands. Then, you need to be careful because your business may be sued separately if you ever cause an accident with a private automobile. You may think nothing of giving a lift to customers or staff in it. However, the business may suffer the consequences if you have an accident and they decide to sue.
Also, you need to think about what happens if you are injured in a car accident and you cannot work for a while. Usually, self-employed people don’t get paid if they don’t work and therefore you may need to add Personal Injury Protection coverage to your policy to make sure you are paid loss of earnings in case of injuries.
How Does Being Self Employed Affect Car Insurance?
Technically you are unlikely to spend more or less because of the way you earn a living. It shouldn’t affect rates directly but it may affect indirectly. Jobs that qualify you for lower premiums are usually well defined. Out of those professions what and how you do hardly make any difference to how much premium you pay.
Being self-employed shouldn’t directly influence automobile insurance premiums if a private car is only used for commuting to work like everybody else.
Nevertheless, what you do can influence rates indirectly by increasing or reducing the miles you travel and type of coverage you need. If you are working from home most of the time you may not need to drive much and can get low mileage discount. On the other hand, you may have to pay a bit more if you are required you to drive long distances.
If the automobile is integral part of your trade you should let the insurer know the position. There is a high chance a policy can be adjusted to cover current vehicle use, depending on what you do and where you live.
For example, jobs like pizza delivery may be covered in some states and not others. The best thing to do is to disclose the activities to the carrier or agent and see what they say. At the end, you may end up spending a little bit more to include commercial use. But that would be the right thing to do and make sure that you won’t have problems when you have a claim.
Commercial vs Personal Auto Insurance
Large numbers of people who are running businesses don’t need an automobile for it and a few cannot carry out their trade in a private car anyway. For example, you need a van or a truck to carry out labor intensive works and they usually need a separate policy. And the whole thing may be irrelevant if you are working from an office like an accountant. You commute to work like everybody else.
As mentioned above, it may be tricky to distinguish its purpose. You may need to buy business vehicle insurance instead in the following situations.
- Pay attention when the job takes it over. Then, you need to be honest with the carrier. What is important is the use of the vehicle rather than its registration details. It may be registered to your name but its daily function cannot be ignored and more important.
- If it is registered to the company it is best that coverage matches it.
- If the automobile carries a logo it may be better to have at least trade use endorsement on the schedule. Remember that people can sue the firm if they can demonstrate a link between the vehicle and it.
- It is probably beyond the scope of a traditional policy if the workers often drive the vehicle.
- If you often carry merchandise, make deliveries or carry customers you probably need commercial policy.