Business car insurance
Expert tips on insuring your car for business use
Our car insurance expert, Adrian Taylor, has some helpful tips for getting your car covered for business use.
Adrian Taylor
Executive General Manager – General Insurance
Let your insurer know how you use your vehicle
Be sure to let your insurer know how you intend to use the vehicle so you get the right cover in place, as some insurers might not offer cover for business use.
Switch car insurance at any time
If you decide to switch policies and you’ve paid a portion or all your premium upfront, you’ll usually receive a pro-rata refund for the unused period of insurance. Just make sure to check if your current policy has any cancellation fees.
Purchase car insurance online and compare regularly
Many insurers offer a first-year premium discount if you purchase your policy online. However, this means your premium for the following year will increase when the discount ends, so it pays to compare insurance at least once a year.
What is car insurance for business use?
Most car insurance policies provide cover for losses that occur when the vehicle is used for personal use. With some policies you can also have cover for losses related to business use, such as when you use your vehicle for work. Business use typically refers to tasks where your job regularly requires you to use your car to complete daily work, such as:
- Driving between locations as part of your job (e.g. tradies)
- Using your car to transport other employees or goods from one location to another (e.g. a sales representative).
However, if you sometimes use your car to get the office milk, lunch or supplies, this is unlikely to count as business use of your car.
Insurers don’t always offer cover for business use, so it’s essential to check the relevant Product Disclosure Statement (PDS) before buying a policy for details on what’s covered. The Target Market Determination (TMD) may help you get a better understanding of whether the product is right for you as well.
Which levels of car insurance cover include business use?
If business use is included as part of your car insurance cover, the following levels of cover could insure your vehicle while it’s being used for business purposes:
- Comprehensive car insurance. As the highest level of car insurance, comprehensive car insurance covers damage you cause to a third party’s vehicle or property in an accident, as well as damage to your car. Comprehensive car insurance also covers fire, hail and storm damage, as well as theft and attempted theft.
- Third Party Fire and Theft (TPFT). This policy covers you for damage your car causes to other vehicles and property. It also covers your vehicle for fire damage and theft. Depending on your insurer, it may also cover accidental damage to your car if an insured third party was at fault for the accident.
- Third Party Property Damage (TPPD). As the most basic level of cover, TPPD insures the damage you cause with your car to other people’s vehicles and property in an accident. The only instance TPPD may cover your own car is if it’s damaged by an uninsured third party.
Is business use car insurance the same as commercial vehicle insurance?
Car insurance for business use of a personal vehicle isn’t the same as commercial motor vehicle insurance.
Car insurance policies for business use typically include additional cover for work-related activities. Commercial insurance policies provide cover for small business vehicles and also some large business vehicles that are used specifically for work purposes only, not for personal use (with some exceptions).
Commercial car insurance is sometimes offered as a standalone product and may also insure numerous vehicles under one policy (which is referred to as a fleet policy). These policies may also cover vehicles that aren’t passenger cars, such as forklifts, heavy trucks and tractors.
Inclusions and exclusions
What does business car insurance cover?
Below is a summary of what’s typically included in each available level of cover.
| What is and what isn’t covered? | Third Party Property Damage | Third Party Fire and Theft | Comprehensive | CTP/Green Slip |
|---|---|---|---|---|
| Damage to your own vehicle following a collision | ✗ | ✗ | ✓ | ✗ |
| Loss or damage to a third party’s vehicle/property caused by your car (legal liability) | ✓ | ✓ | ✓ | ✗ |
| Loss or damage to your own vehicle caused by weather (storm, flood, hail) | ✗ | ✗ | ✓ | ✗ |
| Loss or damage to your vehicle caused by theft | ✗ | ✓ | ✓ | ✗ |
| Hire car after theft | ✗ | ✓ | ✓ | ✗ |
| Loss or damage to your vehicle caused by fire | ✗ | ✓ | ✓ | ✗ |
| Loss or damage of personal possessions/effects | ✗ | ✗ | ✓ | ✗ |
| Damage to your vehicle caused by an uninsured driver | ✓ | ✓ | ✓ | ✗ |
| Emergency transport and/or accommodation | ✗ | ✗ | ✓ | ✗ |
| Towing | ✗ | ✓ | ✓ | ✗ |
| Key replacement | ✗ | ✗ | ✓ | ✗ |
| Death benefit | ✓ | ✓ | ✓ | ✗ |
| Legal liability for injuries or death to other people | ✗ | ✗ | ✗ | ✓ |
| Variable excess | ✗ | ✗ | ✓ | ✗ |
| Restricted driver discount | ✓ | ✓ | ✓ | ✗ |
Inclusions and exclusions may differ depending on your insurer. Always read the relevant PDS policy document for full details on benefits, limits and sub-limits.
What does business car insurance not cover?
Use of a personal vehicle for business purposes will be subject to the same exclusions as the level of personal cover you take out. Typical exclusions are:
- Driving under the influence of drugs or alcohol
- Driving with an invalid licence
- Intentional damage to your vehicle
- Car racing
- Natural wear and tear, such as rust or mechanical failure.
Read the PDS for more in-depth information on a policy’s exclusions.
Can my car insurance cover my business equipment?
Some comprehensive car insurance policies may include cover for personal effects, like tools, computers and other business equipment. It’s one reason why it’s worth comparing your options and making sure the policy you purchase suits your needs.
Purchasing car insurance for business purposes
How do I get car insurance for my business car?
When comparing your options through our car insurance comparison service, you’ll have the option of selecting ‘private and occasional business’ or ‘private and business’. From there, some questions will be asked about how you plan to use your car, which may include:
- Whether you’ll be using the vehicle for ridesharing
- If the car will be used to transport goods or make deliveries for a fee.
Is car insurance for business use more expensive?
Car insurance that covers both personal and business use could be more expensive than a personal use policy with the same level of cover. However, there are many factors that can influence the price of car insurance, so consider comparing your options.
Can I get car insurance for ridesharing?
Many car insurance policies don’t cover ridesharing, but there are some that do. It’s worth checking with your insurer if they cover incidents that occur while ridesharing and inform them you’re using your personal car for these services.
Learn more about car insurance for car insurance for rideshare driving.
Meet our car insurance expert, Adrian Taylor
As a General Insurance expert with over 13 years’ experience in financial services, Adrian Taylor is passionate about demystifying car insurance for consumers, so they have a better understanding of what they’re covered for. Adrian’s goal is to make more information available from more insurers, to make it easier to compare and save.