Personal or Commercial?


Understanding your auto insurance:
Personal insurance or commercial?

When you own an independent business in Colorado or are self-employed, it can be confusing to determine which type of auto insurance is right for you — commercial insurance or personal insurance?

Whether or not you need a personal insurance policy or commercial policy in Colorado depends on how you use your vehicle and what company you have it insured with. Every company has different guidelines and may surcharge for business-use coverage on a personal auto insurance policy.

If you’re not sure whether business use is covered on your personal insurance policy, it’s important to call your Denver Insurance Agent. Leading commercial auto insurer Progressive offers these four questions you might want to ask:

What is considered “commercial use”? One definition could include “engaging in transporting goods for compensation or a fee,” which includes pizza or newspaper delivery, catering, door-to-door consulting services, landscaping or snowplowing services, logging business, day care/church van services or farm-to-market delivery in Denver, CO. If you use your vehicle for any of these activities, purchase a commercial vehicle policy in place of a personal insurance policy.

Do I need more liability coverage than a personal auto policy provides? As a business, Colorado requires you to carry minimum liability limits just like on a personal insurance policy. In some cases, your clients might require you to carry higher liability limits than are required by state law. Find out which — if any — liability requirements apply to your Colorado business and if a personal insurance policy is sufficient.

Do I need special coverage for situations encountered while conducting business? Colorado Commercial auto policies usually offer specialized coverages that are normally not available with personal auto insurance policies. These include Non-Owned Auto coverage, which would cover your employees’ personal vehicles while they’re on a business errand, and Hired Auto coverage, which covers rental vehicles.

Do I need to list any employees as drivers? If you have employees who drive your business vehicles, they should be listed on your commercial auto policy so they’re covered if they get into an accident. With a personal auto insurance policy, you can’t list employees as drivers unless they live with you.

In general, you’ll need commercial auto coverage in Colorado if the vehicle you use is owned by a corporation, partnership or driven by employees, or if it’s used to haul tools or equipment weighing more than 500 pounds, makes deliveries, or is heavy enough to require state or federal filings. If none of these apply to you, than a personal auto insurance policy is what you need. Which can be packaged with your existing homeowners insurance or renters insurance policies.

For more information about Colorado personal auto insurance and commercial auto insurance, call Denver's leading independent insurance agency, Insurance Town & Country, today! 303.388.7216
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