Is my auto policy for personal use or business use?
I recently purchased a cargo van to transport tools and appliances to my rental properties. The van won’t be used frequently, as I don’t need it all the time. However, I’ve received conflicting information from two different insurance companies. One company said that since rental properties aren’t classified as businesses, my van could be considered personal use since I’m only moving supplies and equipment for my own properties. The other company, however, disagreed and argued that it should be classified as business use, as they view rental activities in that context regardless. Has anyone else encountered this issue? I could use some guidance!
It sounds like you’re in a bit of a gray area regarding how your cargo van should be classified for insurance purposes. Generally, whether your usage is considered personal or business can depend on the specific activities you engage in while using the vehicle.
Personal Use: If you’re strictly using the van for transporting personal items or conducting minor activities that aren’t classified as a business (like maintaining your own properties without making a profit out of them), some insurers may allow for personal use coverage. However, this can be tricky if the activities directly relate to managing rental properties.
Business Use: Most insurance companies will see the use of a cargo van for hauling tools and appliances related to your rental properties as business use. Even if rental properties aren’t classified as a traditional business, the income generated from rentals typically categorizes those activities as business-related.
In short, it would be wise to check with multiple insurance providers about their definitions and policies. It may also be beneficial to speak with an insurance agent who specializes in commercial insurance for clarity. If you’re using the van primarily for your rental properties, erring on the side of caution by selecting a business use policy might be the best option, as it could provide more comprehensive coverage in case of any incidents.