Commercial Car Fleet

Car insurance for business use

Looking to get your car insured for business use? Learn the conditions before applying.

If you use your car for business purposes, whether it’s a work van, a delivery truck, a part-time taxi or anything else, it may be a good idea to consider getting a car insurance policy for business use. This is because standard consumer car insurance policies will often not cover a vehicle while it’s being used for business purposes which can lead to claims being denied.

Business use car insurance is a way of extending standard policies so you’re also covered when driving the car for business purposes. Business use car insurance is only for when you’re driving the same car for business use and for personal use. Company cars, or cars which are only ever used for business purposes usually require commercial car insurance instead.

Conditions for application

Conditions vary between providers but you will generally need to inform your provider if you plan on using your vehicle for business use during application.

Compare comprehensive policies from Australian brands

Name Product New Car Replacement Pay monthly at no extra cost Choice of repairer Roadside Assistance Hire car after theft Personal effects
Optional - If your car is written off in the first 3 years
No
No
No
Optional - Up to $50 a day until your claim is settled
$0
Save 24% on your policy if you've been claim free for 3 years.
Yes - If your car is written off in the first 2 years or is under 40,000 km
No
Yes
Optional
Yes - Up to $1,000 (Max 14 days)
$250
Buy online and save 15%.
Yes - If your car is written off or stolen in the first 2 years
No
Yes
Yes
Yes - Reasonable costs (Max 14 days)
$750
Emergency roadside assistance included in Comprehensive policies.
Yes - If your car is written off in the first 2 years
No
No
Optional
Yes - Up to $70 per day (Max 14 days)
$500
Save up to 10% when you buy online.
Yes - If your car is written off in the first 2 years or is under 40,000 km
No
Yes
Optional
Yes - Up to $1,000 (Max 14 days)
$500
Save 15% when purchasing online. Eligible customers can earn up to 20,000 Velocity Frequent Flyer Points when purchasing a new policy by 31 Oct 2018. Excludes NT. Min 6mths policy & T&CS apply.
Yes - If your car is written off in the first 2 years
Yes
No
No
Yes - Up to $70 per day (Max 14 days)
$500
Transforms your driving so it's 100% carbon neutral.
Yes - If your car is written off in the first 2 years
Yes
Yes
No
Yes - Up to $100 per day (Max 30 days)
$1,000
Buy online and save up to 10% on your policy.
Yes - If your car is written off in the first year or is under 20,000 km
No
No
Optional
Optional - Up to $60 per day (Max 14 days)
$500
Save up to 20% on car insurance when you purchase cover online.

Compare up to 4 providers

What makes business use car insurance different?

When you take out a car insurance policy, you will often have the option of selecting business use during the application. For example, an application might ask whether you:

  • Drive the car for personal use only
  • Occasionally drive the car for business use
  • Regularly drive the car for both personal and business use

Most comprehensive policies will automatically exclude cover if the vehicle is used for:

  • Carrying passengers or other people’s goods for payment
  • Driving tuition for payment
  • Hiring the car to other people for a fee

If you do not specify that you use the vehicle for both personal and business driving, you might not be covered at all while driving the car for business purposes, and any resulting claims might be declined. By selecting business use during application, your policy may also include additional types of cover such as:

  • Including tools of trade under personal effects cover
  • Insuring your business partners, employers, principals or associates to drive the car

When your vehicle is essential to your income, for reasons other than just driving to work, you probably need a business use car insurance policy. For example, if you carry passengers for pay then that would be a business purpose, or if you sometimes use your car to specifically carry construction materials to a building site then that would also be a business use.

How much does business use car insurance cost?

Cars that are used for business purposes will also tend to be on the road a lot more, which makes a significant difference to the likelihood of being involved in an accident. As such, it generally costs more to insure a vehicle for both personal and business use than it does to insure it for personal use alone.

It can face additional risks to those just being used for everyday use. Most people, for instance, will never drive their car onto a construction site, or carry a lot of potentially hazardous cleaning materials in their vehicle, while you might do it everyday.

The cost of a business use vehicle policy is determined by the policy options you select, as well as factors such as:

  • The type of vehicle it is
  • What its primary use is
  • How many different drivers use it
  • What types of damage it is likely to be subject to

What will business use car insurance policies not cover?

You will typically find the same general exclusions as most other car insurance policies, with a few others. You may not be able to claim for:

  • Using the vehicle in connection with motor industry tests or demonstrations
  • Renting or hiring the vehicle out to other people, or if it’s someone else’s possession for sale purposes
  • Damage to the vehicle as the result of bitumen or concrete setting on it
  • Unsafe use of cranes in connection with the vehicle
  • Any asbestos liability
  • Financial loss resulting from the vehicle being unusable

With business use car insurance, insurers are more likely to understand that you do not necessarily have complete knowledge or control of your employee’s actions. Depending on the policy, you may still be partially covered when you weren’t the driver, but your employee:

  • Refuses to take legal breath, blood or other drug test following an accident, if you are able to demonstrate that you were not aware of the driver’s condition or refusal.
  • Is driving unlicensed without your consent, if there is reason to believe that you didn’t know about it, such as if they were using a fake license or it had recently expired or had been cancelled as a result of unpaid parking fines.

How to find the right business use car insurance policy

The right policy will meet all three of your main needs:

  • It’s affordable
  • It has adequate cover for your personal driving
  • It effectively meets the specific needs of your business driving

Most comprehensive business use policies will be adequate for personal driving use, and you can instead pay special attention to matching the cover with your business. For example, a travelling salesperson might expect long distance driving and frequent starting and stopping, while a builder might be more interested in protection from the risks associated with driving onto a construction site. Consider:

  • The specific types of damage or hazards you are likely to encounter
  • Whether employees will also be driving the car
  • Whether you need cover for an equipment trailer or caravan
  • Whether you need trade tools cover, or cover for the equipment carried in a trailer
  • What level of liability cover you need
  • What kinds of goods or equipment you tend to carry in your vehicle on a daily basis, and the risks these may pose
  • What kind of vehicle you’re getting insured and how many need to be covered

Cars, trucks, vans and almost all vehicles that may be associated with business use can be insured under this policy type. The type(s) of vehicle covered may have further impacts on your costs and cover needs.

It’s possible that a standard car insurance policy will be adequate, but you should check the exclusions to find out whether you’re still covered when driving the car for business purposes. If you have more complicated business needs, or want cover for multiple vehicles, it might be worth using a car insurance broker to help find the right level of protection for you and your livelihood.

Looking for commercial car insurance? You might prefer speaking with a business insurance broker

Receive a Quote for Business Insurance

If you are ready to speak with a consultant about different business insurance options available, simply enter your details in the form. Keep reading if you want to learn more about the different types of cover available.
FBI Lender Logos
Picture: Shutterstock


Get the latest car insurance news

Andrew Munro

Andrew writes for finder.com, comparing products, writing guides and looking for new ways to help people make smart decisions. He's a fan of insurance, business news and cryptocurrency.

Was this content helpful to you? No  Yes

Related Posts

Ask an Expert

You are about to post a question on finder.com.au:

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • finder.com.au is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Finder only provides general advice and factual information, so consider your own circumstances, or seek advice before you decide to act on our content. By submitting a question, you're accepting our Privacy & Cookies Policy and Terms of Use, Disclaimer & Privacy Policy.
Ask a question
Go to site