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If you are a contractor in NC using your personal auto insurance policy for business use, then you may not be adequately covered if you are using that vehicle for business use when a claim occurs.  Most insurance companies will deny coverage on your personal auto policy if you have a loss while using your vehicle for business use.
We will discuss some of the more common types of contractors in NC that may need a commercial auto insurance policy.  We will also help dispel some of the common myths regarding commercial auto insurance for these contractors.
TYPES OF CONTRACTORS NEEDING COMMERCIAL AUTO POLICIES
Below are some of the more common contractors that may need to have commercial auto policy.
 
Painters
Carpenters
General Contractors
Roofers
Plumbers
Electricians
HVAC Repair
Handypersons
Janitorial Services
Concrete Contractors
 
MYTH 1
A COMMERCIAL AUTO POLICY IS EXPENSIVE
Many people are afraid that if you purchase a commercial auto policy, that you will pay more for auto insurance.  This is a myth.  In fact, in many cases a commercial auto policy may actually be less expensive.
If you have points on your license from tickets or accidents, then certain commercial policies actually weigh less heavily on rates on a commercial auto policy then on a personal auto policy.
Contractor auto insurance is one of the more competitive industries.  Right now, this is a target market for many of the larger companies.  This in turn makes the rates much more competitive.  Most of our customers are pleasantly surprised when we give them the rates for commercial auto insurance.
 
MYTH 2
MY PERSONAL AUTO POLICY WILL PAY OUT IF I AM USING MY POLICY FOR WORK
Depending on the type of loss that occurs, many companies will deny your claim if the policy is not written correctly.  Even if you are a painter, and you back your pickup truck into property of any kind at a job site, your claim can be denied.
MYTH 3
THERE IS NOT A POLICY THAT COVERS ME FOR BOTH PERSONAL AND COMMERCIAL USE
Many companies offer hybrid policies that will cover you if you are using your vehicle for personal or business use.  This is true for most business types.  You just need to disclose the use of the vehicle to your agent so that you will be covered in any possible claim.  We have a company that has actually recently instituted this for ride share companies such as Uber and Lyft.  There is a coverage gap that will not cover you unless you add this endorsement to your personal policy.  Without this policy, you are exposing yourself to one of the more recent causes of denied claims.  You don’t have to purchase an expensive taxi cab policy if you are using your car sporadically for this purpose.  Just add this endorsement to your personal auto policy.  Use caution though, as this is so new that many companies do not offer this endorsement yet.
MYTH 4
MY CAR IS NOT IN A BUSINESS NAME, SO MY PERSONAL AUTO WILL COVER ME
Your vehicle does not need to be in a business name to require a business auto policy.  If you have advertising on your vehicle or if you use your vehicle for business use, then you should contact your agent to see if you should update your policy.  In some cases, you can just add business use to your personal auto policy and be adequately covered. In others, you would need to have a business auto policy in place.
 
MYTH 5
IF I HAVE A COMMERCIAL AUTO POLICY, THEN IT WILL COVER ME FOR PERSONAL USE OF THAT VEHICLE
It is important to disclose to your agent that you use your vehicle for personal use as well. In most cases, the difference in premium could be minimal and it could be the difference in being covered or not.
There are so many reasons to make sure that you have the right policy in place so that you will never have a claim denied.  Why pay for insurance if there is a chance they won’t pay out for a claim?  Quotes are free and it can’t hurt to educate yourself fully on the matter.  If you have any questions on the matter or would like a free quote, please call us at 704-494-9495.