Do you need business insurance for your car?

Drive legally with help from Logbook Loans


If you’ve been working at home during lockdown, one of the benefits has been that you don’t have to travel for work any more. No commuting to the office, and no more driving to meetings or client visits. 

But things are gradually changing and you may well now be back at your work premises for at least some of the time. Which most probably means that you are using your car more again.

But what many people don’t realise is that if you are using your car for work, then you need business insurance for your car. Insurers base your level of cover on the usage of your car, so you need to make sure that you have the correct level of cover for what you need.

So let’s take a look at when you need business car insurance, where to get it, and what happens if you don’t have it.


When do I need business car insurance?

First and foremost, you do need insurance for your car. It is an offence to drive a car without it being insured. But be aware that most car insurance policies only cover you for “Social, Domestic and Pleasure” purposes. This includes everyday activities such as shopping, school runs, errands, trips out, and visiting friends or family. 

Your Social, Domestic and Pleasure policy should also cover you for your daily commute to and from work. It’s worth double-checking this to make sure, but most standard policies will cover this. So if the only way you use your car for work is to travel to and from your regular place of work, then you do not need business car insurance.

However, if you also use your car during the working day, for example to travel between different work locations, attend meetings or visit customers and clients then this is classed as business use. Most standard car insurance policies do NOT cover this.

So if you use your own car in your job for these kinds of activities you will need business car insurance.

If you have a company car, then your employer should sort out the appropriate insurance. But again, if you are in any doubt, then check.

Also if you are using your car as the main focus of your job – for example, taxi service, delivery driver, driving instructor – then you will need commercial car insurance rather than business car insurance.


Where can I get business car insurance?

As you might expect, business car insurance does not come cheap. This is because insurers regard you as a greater risk. You will be doing more miles, often during heavy traffic and on unfamiliar roads. Your car may also possibly be exposed to riskier or less secure locations where theft or damage could happen. Business car insurance covers you for all these additional risks.

There are three different classes of business car insurance. The most common is Class 1, which covers you for travel to different locations for your job. Most people who use their car for work just need Class 1 business car insurance.

Most business car insurance policies include cover for a spouse to use your car for Social, Domestic and Pleasure us. But you would need Class 2 business car insurance if you want to add any other named driver to use your car for business purposes.

The most comprehensive type of business car insurance is Class 3, which you would only need if you are regularly driving hundreds of miles each week and/or need several named drivers on your policy.

Most insurance companies offer business car insurance, so the best place to start looking would probably be your current insurer. But also check out comparison websites such as:


What happens if I don’t have business car insurance?

It is really important to get business car insurance if you do use your car for work purposes. It can be tempting not to bother, particularly if you are trying to save money, but it is simply not worth the risk. If you are involved in an accident while using your car for work, and do not have business car insurance, your insurance policy is likely to be invalid and your claim rejected. 

So do make sure that you have the right level of insurance cover for your needs.


We hope that the above information helps you to stay safe whilst on the road, and be prepared for anything. Check back here soon for more motoring, lifestyle and financial tips from Logbook Loans.