Why do car insurance companies ask whether you use car for business use?

Question

Does it affect how much you pay for insurance?

Answer 1

Cause in case of business you will use car more often, and should pay more to insure.

http://autoinsurance.maclenet.com - here you can compare your personal and business quotes.

Answer 2

Well, it affects the rate, AND the eligibility!  If you're using the car as a taxi, you can't put it on a personal auto policy.

Answer 3

Yes, it affects the rates.

Answer 4

They all ask it.  It will raise you rates about 5% depending on the company,

Answer 5

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Answer 6

Joe,

This answer is quite simple.  If you use your vehicle for business, you will be driving a lot more than if it is for personal use.

Personal use is defined driving to and from work. To and from school, etc.

Hope this helps

Take Care

Darlene ;-)

Answer 7

You bet!

You are at a much higher risk of having an accident if you are driving during the business day.  Speeds are higher when the roads are not crowded at rush hour.  

You are readily available for trouble.  Insurance companies do not enjoy a loss of money.

Answer 8

it's true that they all ask!  i've found that if you say you use it for business your rates are higher than if you "use it for personal (school, home, etc) reasons"

Answer 9

They ask because you are on the road more (could be most of the day depending on what you do) and put more mileage on the car, therefore, there is more chance of an accident.  You would drive you car much more than someone that just drives to work.  There are also different rate classes for driving to work (pleasure up to 3 miles one way, 3 miles to 10 or 15 miles one way - depends on the state & over 10 or 15 miles one way)  The more you drive even based on your commute, the more you'll pay for insurance.  The business use class is the highest because even the over 15 miles class maybe drives 40 miles in a day to work & back are only on the road twice a day.  Also, if you say you do use the vehicle for business use the agent will ask what the business use entails.  Are you just running errands for the business (going to the post office to pick up mail, going to the bank with the deposit)?  Or are you delivering mail or newspapers or taking people in your vehicle (there is a difference for taking co-workers to a meeting or taking people for a fee)?  Do you have signs on your vehicle?  The answers to the follow up questions will determine if your vehicle can stay on your personal policy or if it has to be on a business car policy.

I've had good results here...

http://insurance.123thebest.info/

Good Luck.