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Should You Get Home Business Driving Insurance?

written by: Cherise Kelley•edited by: John Garger•updated: 2/10/2010

Do you drive as part of your home business? You might be shocked at what your insurance company classifies as business driving. Find out now if you are covered before you have a claim against you.

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    Business driving definition:

    Are you paid to drive kids to or from school? Do you drive customer's cars to your home to detail them or to install GPS, stereo or CB equipment? Do you make food or other products and deliver them to someone's home or work? Are you paid to grocery shop for clients? These are types of driving that you may consider personal. Beware. Your insurance may consider these business driving.

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    Why you should care about business driving:

    You may be denied coverage because you are driving for pay. You need to find out before you have a claim. A claim could be relatively cheap car repairs after vandalism, or it could be expensive medical bills for several people after a multi-car accident. It is impossible to spell out the difference here between personal and business use of a car. Each insurer defines the difference its own way, and so do the regulations of each state. My goal is to make you aware that your insurer draws a line, and that you need to know where this line is. I have seen coverage denied on dozens of these claims. You could lose your house, your retirement savings, your children's college funds, and any other assets you have.

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    How to tell if your insurance policy excludes your type of driving:

    Read your auto insurance policy carefully. Pay special attention to the exclusions under the collision section and the liability section. Look for words like "delivery", "fee", "charge", and "business". Almost every personal auto insurance policy excludes pizza delivery and taxi service. Uses that resemble pizza delivery or taxi service are excluded by varying degrees in auto policies. If you don't feel able to read this carefully, then call the claims line at your insurance company. You can find the claims line on your insurance bill. You may find it easier to call your insurance agent, but agents don't handle claims. Agents often aren't familiar with coverage technicalities such as business use. Agents themselves often call the insurance claims line to ask about coverage issues. Ask to speak with a liability claims adjuster.

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    Your options if coverage is excluded for your type of driving:

    You can change auto insurance companies. If you do this, call the new company's claims line ahead of time and find out what driving they exclude. You can get business auto insurance. You can change the nature of your home business to avoid paid driving. What you cannot afford to do is go without insurance for any driving. The amount of liability you face while driving is far too much to cover on your own with a savings account. If you work at home as an employee, then you may be covered by your employer. Check with them.