Personal Car Insurance vs. Business Car Insurance All the information provided on this site is for a car insurance policy purchased for your personal use of your car. What does personal use refer to and are you covered for what you are really using your car for? Personal use refers to use of your car for your own personal needs. Your everyday errands, traveling, and commuting are considered personal use of your car. However, most car insurance policies exclude liability arising out of business uses of your car. A business use is using your car to carry passengers or cargo for a fee. For example, a taxi carries passengers for a fee. Taxi drivers may be required to have a special “livery” but also will be permit or license but will also be required to have a commercial car insurance policy, with different minimum limits than established for drivers using their cars for personal use. If a taxi driver is driving with only a personal use car insurance policy, it is as if you are driving with no insurance. Other business uses that are specifically excluded in most personal car insurance policies are selling, storing, repairing, parking, or servicing cars. For example, if you are a car mechanic, part of your job is to determine what needs to be fixed and testing that the car is repaired properly. To test the performance of a car, mechanics may need to test drive a car. If you as a mechanic only have personal use car insurance, if you are in an accident, your car insurance will not cover your liability from an accident while you are testing or serving someone else’s car. For car mechanics, insurance companies sell a special policy called a garage liability policy to cover such accidents. Generally, you can purchase commercial car insurance to cover liability, collision, comprehensive, and uninsured motorist coverage. You may also need commercial car insurance if you use your car to conduct a service, tow equipment or a trailer with tools used in the performance of your work, if your car is titled in the name of your business entity, or if your type of work requires you carry particular liability coverage. You should also consult your insurance company if you use your car for farming or ranching uses to be sure your car or trailer use is covered under your car insurance policy. You may have special needs for insurance even if your farming or ranching uses are only personal in nature. When you tow a trailer for your personal use, it is generally covered for liability coverage by your car insurance policy just like your car (be sure to check your car insurance policy if you want to add the trailer to your collision or comprehensive coverage.) However, if you are towing a horse trailer or other livestock, you may want to consider separate trailer insurance, including coverage for the contents of your trailer (tack or other valuable equipment) and your horse or other animals. While some equipment inside your trailer may be covered by your homeowner’s or renter’s insurance, the animals inside your trailer are not covered.