Knowing when to insure your vehicle on a business or personal auto policy can have some major coverage issues if done incorrectly. In fact, if you insure a commercially used vehicle on a personal auto policy, your insurance company can deny all claims.
States definitely vary when it comes to auto insurance coverages and exclusions, so for the purpose of this blog, we are dealing with vehicles that are owned, registered, used and insured in California. Under California auto insurance policies, it's imperative that you insure your owned vehicles properly according to their usage first, and then based on ownership.
If you are using your vehicle for work, and that means driving around with passengers to visit sites, or with trailers hitched up to haul equipment, or beds filled with landscaping tools, that vehicle, regardless who owns it and how it is titled, needs to be on a commercial or California business auto insurance policy.
Once it's insured properly for the exposure, then you make sure to list the owner as an additional insured 'and' loss payee unless the owner and the named insured on your business auto policy are identical. Example; John Smith owns Smith Construction, Inc. however, his truck is owned by and titled to him and his wife. The commercial auto policy would be written with Smith Construction Inc as the 'Named Insured' and then John & Mary Smith would both be listed as loss payee and additional insureds providing them with both physical damage and liability protection.
The best way to make sure you're properly covered is to speak with your insurance agent. They can help you understand your policy and make sure you have the coverage you need for your business and vehicles.