Which Side of the Line Are You On?

Personal and commercial auto policies are different products for different exposures. The boundary is not always obvious, and being on the wrong side of it is discovered at the worst possible time — during a claim.

The clear cases

Personal: a car you own, driving to work, errands, family transport, holidays. Even a long commute is personal use.

Commercial: a vehicle owned by a business, a vehicle carrying goods or passengers for compensation, a vehicle carrying tools and materials as a core part of a trade, or any vehicle with employees driving it.

The gray areas, honestly

• Self-employed with one van. Usually commercial, particularly if the business owns it or it is signwritten.
• Realtor driving clients around. Often personal with a business-use classification — but ask, because carriers differ.
• Occasional deliveries in your own car. Commonly excluded from personal policies. Needs an endorsement or a different policy.
• Commuting with company tools in the boot. Depends on the carrier and the volume. Ask specifically.
• A car in your name used mostly for a business you own. Almost always a commercial conversation.

"Ask" appears repeatedly because these are genuinely carrier-specific determinations, not universal rules. Anyone giving you a firm answer without knowing your carrier is guessing.

Why it matters more than the label

Personal policies contain exclusions for business and commercial use. If the exclusion applies, the claim is not a coverage dispute — there is simply no coverage for that use, regardless of how many years of premium have been paid.

The exposure also differs. A commercial policy typically offers higher limits, hired and non-owned auto coverage for employee vehicles, and coverage structures that a personal policy has no equivalent for.

The five-question test

1. Does the vehicle earn money directly, by carrying goods or people?
2. Is it owned by or titled to a business?
3. Will anyone other than the household drive it?
4. Does it carry tools, stock or equipment as a routine part of work?
5. Is it signwritten or otherwise presented as a business vehicle?

A clear yes to any of these means the commercial conversation is worth having. Two or more, and it is almost certainly the right product.

The cost question, answered honestly

Commercial coverage is a different product with a different rating basis, and we are not going to characterise the difference in the abstract — it depends on the vehicle, the use, the drivers and the limits. Get both quoted for your actual situation and compare real numbers. What we can say plainly is that the wrong policy is not a saving; it is an uncovered claim waiting to happen.

Not sure which side you are on? Describe what the vehicle does and we will tell you.