Understanding Personal Insurance

What exactly is personal insurance It is very important to first understand this so that we can understand our designated topic better. The personal insurance is done so that a person can easily reimburse the amount he has made of the medical treatment if he has undergone some sort of medical treatment due to any reason or the family of the person can get the compensation in case he

dies in an accident or due to any other reason. Thus, personal insurance is an indemnity against all the possible risks that can be assumed to be associated with the life of person.

Also, many of us have to drive regularly due to one reason or the other. When a person buys a car, he has to invariably purchase the personal auto insurance policy as per the various rules of the law prevailing in the different countries. The coverage that is provided by the above policy is sufficient for any untoward incident when the person is driving. But what if the person that is driving an automobile for some business purposes In those cases, does the personal auto insurance provide the necessary cover The answer to the above question is no.

Even if the company etc where is person is working, does not have any commercial vehicle, the person in not liable to get the coverage as he was driving the vehicle for the business or occupational purpose and not for the personal purpose. So, what has to be done in such cases Also, as the cost of insurance of auto etc is rising day by day, it does put a load on a persons pocket if he wishes to get himself insured by way of auto insurance. The answer to all the question above is the business auto insurance. Let us discuss it in our next part of discussion.

The Business Auto Insurance

The business auto insurance is almost the same as the personal auto insurance and the difference between the two is that a person has to pay a little more so as to cover all the risks that are associated with him driving the vehicle for the business purposes. Thus, all those covers that are not provided when a person takes a personal auto insurance and are associated with the occupation of a person are covered under the business auto insurance.

Now the question arises here is that when does a person requires a business auto insurance i.e. what are the different types of businesses that are covered under the business auto insurance Let us discuss all of these in our next part of discussion.

The Need for the Business Auto Insurance

If a person is attached with any kind of business that is being run by him from home, he has to get the business auto insurance as the personal auto insurance is not sufficient so as to cover all the risks associated with the business. Thus, all the home-based businesspersons should get the business auto insurance. This was just an example and it does never mean that there are no other circumstances under which a person has to get the business auto insurance done. Actually, there are no hard and fast rules about the various situations in which a person should get the above-mentioned insurance done. The best way to understand it can be that whenever a person is using his car for the business purpose, the business auto insurance is necessary.

If you are running a home-based business, for example, you may assume your personal auto insurance is enough, but this isn't always the case. Unfortunately there is no black and white answer that dictates when you need to buy a rider to your personal insurance policy to cover the business use of your car. Also, a person can easily contact one of the various agents of the insurance companies and can easily ask him about the use of your vehicle for the business purpose and the related risks. He shall apprise you of all the circumstances in which your personal insurance would not be enough. Most probably, after having discussions with him, you would agree to get the business auto insurance done and in that case, you have to pay about 10% more than what you have been paying towards your personal policy. But this amount is not that much so that a person gets disappointed.

But if you are driving an automobile that is owned under the name of your business, there is absolutely no need of getting the business auto insurance. This is because the vehicle is already insured with the insurance company and thus, all the related risks attached to you when you are driving the vehicle, automatically gets covered. The actual problem occurs when one of your employees is driving his personal vehicle for the business. This is really something dangerous and in case, if some untoward event happens, you may end paying a huge sum of money. Not because he is driving, as his care is taken of by the company that has done his insurance, but because for the reason that you have to pay to the person who has been hit by his vehicle. And in case, such person dies on the spot, you can rest assure that you have put yourself in the greatest troubles of your life.

You may end up loosing your all the business and still you owe much amount towards his family. Thus, if your employees use their vehicle for your business purposes, you should take a hired and non-owned policy to avert all the possible risks. The above said policy protects your business very efficiently when your employee is using his vehicle for your business requirements. Also, it makes your employees less apprehensive towards the use of the vehicle as they have satisfaction that they wont be held liable for any accident that might occur when they are driving. The above policy also covers the cars that are rented for the use of businesses purposes.

So, business auto insurance is desirable

Thus, if you are a businessman and your employees frequently use your vehicle for the business purpose, it is very essential that you should avail the business auto insurance policy otherwise you may end up loosing all of your business one day, as discussed above. So, the business auto insurance is desirable in such cases.