Many people use their car every day to generate income without wondering if their insurance really protects them in the event of an accident. That doubt can make a big difference when it comes time to file a claim, since not all policies offer coverage for business-related activities.

Read also: Volkswagen begins to say goodbye to the diesel Golf in Europe

The use given to a vehicle is one of the aspects that insurers analyze the most. Carrying tools, making deliveries, visiting clients or transporting merchandise changes the risk profile and, in some cases, may void the protection of insurance purchased solely for personal use.

You can read: Xiaomi expands its strategy and enters the hybrid segment

According to the National Association of Insurance Commissioners of the United States (NAIC), commercial policies were designed precisely to cover these types of activities and usually include protections that private coverage does not include.

The use of the vehicle makes all the difference

Traditional car insurance protects the driver, occupants and third parties against different types of incidents, as long as the vehicle is used in the manner established in the contract.

The problem appears when the car stops being used exclusively for personal activities and begins to form part of the operation of a business. Delivery, technical services, sales visits or frequent transportation of products are situations that may require different coverage.

It is also advisable to review the type of policy when the vehicle belongs to a company or is used by several employees. In these cases, commercial insurance is usually better suited to the needs of the operation.

What advantages does a commercial policy offer?

Although it shares several coverages with private insurance, a commercial policy is designed to respond to the risks inherent to a business activity.

It generally includes civil liability for damage to third parties, collision coverage and protection against situations such as theft, fire or natural phenomena. In addition, it can extend protection to company vehicles, fleets or units intended for the transport of goods or passengers.

Another important aspect is that insurers often offer higher liability limits, something that can be essential when an accident involves commercial activities.

The price depends on several factors

The value of a policy changes depending on the characteristics of the driver and the vehicle. The NAIC explains that companies take into account elements such as age, driving history, previous claims, place of residence, type of car, number of miles driven and how much use the unit receives.

For that reason, a vehicle that spends a good part of the day making deliveries will usually have different conditions than a car used solely for personal travel.

A review that can avoid problems

Plumbers, electricians, contractors, delivery drivers and small business owners often depend on their vehicles to keep their business running. If an accident occurs and the policy does not cover such commercial use, the financial consequences may be much greater than expected.

Before assuming that the insurance will respond in any circumstance, it is best to review the conditions of the contract and confirm with the insurer what type of activities are covered.

If the vehicle is part of the business or directly contributes to generating income, a commercial policy can become the best way to protect both the assets and the continuity of the company.