Personal vs. Commercial Vehicle: What You Need to Know
Posted by Risk Management Partners Insurance Agency on
When it comes to car insurance, there are two main categories of vehicles: personal and commercial. Personal vehicles are those that are primarily used for personal reasons, like driving to work or running errands. Commercial vehicles are those that are used for business purposes, such as delivery trucks or company cars.
The difference between personal and commercial vehicles matters when it comes to insurance. Insurance companies have different policies and rates for each category of vehicle, because commercial vehicles usually require more coverage.
Personal vehicles are generally less expensive to insure because they are usually driven less and are less likely to be in accidents. Commercial vehicles, on the other hand, are often driven more frequently and may carry more passengers or cargo. This means that they are more likely to be involved in accidents and require more coverage.
If you have a personal vehicle and use it for business purposes, like delivering goods or driving for a rideshare service, you may need to purchase additional coverage or switch to a commercial policy depending on the type of business use. It’s important to talk to your insurance agent to make sure you have the right coverage for your vehicle and usage. Also note that even if you use a large, typically commercially rated truck or van for personal use, it is more than likely that it will still have to be rated as a commercial vehicle due to it’s intended use.
In summary, personal and commercial vehicles have different insurance requirements based on how they are used. If you’re not sure which category your vehicle falls into, it’s important to check with your insurance company to make sure you have the right coverage.