Reviewed by Shannon Martin, Licensed Insurance Agent.
It’s likely that the insurance for a car registered by a business will cost more than insurance registered with an individual.
The cost of insurance has a lot to do with where the car is driven, how much it is driven, and the level of asset protection required.
Business-use vehicles have a higher likelihood of getting into an accident—and thus cost more to insure. Here’s why:
More distance: Commuting distance may be significantly longer than average.
Uncertainty: The car may be driven to several locations per day that the driver is not familiar with.
Lawsuits: A business is more likely to be sued for a much higher amount, so commercial vehicles require insurance protection in the millions (vs. personal liability limits of $100,000 per person and $300,000 per occurrence).
Finally, cost is not the only factor here. A vehicle bought and registered under a business name will not even qualify for coverage on a personal auto policy, in most cases.
But there are
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