Do your employees have the correct motor insurance for their job?

If your employee uses their personal vehicle for work their car insurance policy may not cover the business use.

If your employees use their personal vehicles for work purposes other than commuting to a permanent place of work then they need to have business use included as part of their motor insurance cover.

With price comparison sites promising cheap motor insurance it’s tempting for drivers to choose the cheapest premium and potentially not purchase a policy that insures them adequately for their individual needs.

Different classes of use

Social – vehicle can be driven by named driver for non-related driving only e.g. visiting friends and family or shopping. This is also known as social, domestic and pleasure use only.

Social and Commuting – vehicle can be used as above as well as driving back and forth to a permanent place of work (usually this includes travelling to a railway station en route to work).

Business Use – covers all of the above plus business related driving away from your normal place of work, usually for the main driver and their spouse (with option for other named drivers to be included).

Drivers should read the key facts and policy documents ensuring they are fully aware of any limitations that may be in place.

Financial impact to your staff

A motor insurance policy which includes business use will usually incur a higher premium, due to additional mileage for business use, probability of driving during peak hours etc. Some motor insurance come with business use as standard for the main driver and spouse without additional cost.

Usually employees are compensated for the additional insurance cost through car allowance or mileage allowance payments. This will be specific to each company and their own expenses policies.

Reducing premiums - things employees should consider

  • The car being driven, would a more economical car be an option?
  • Can security devices be installed such as immobilisers, steering locks and tracking systems?
  • Can the vehicle be kept off road or in a garage at night?
  • Can the voluntary excess be increased?


It is the car owner/drivers responsibility to ensure they have appropriate insurance for the use of their vehicle. If the vehicle is not insured for the purpose of business use and is involved in an accident due to business use then the insurance company may decline the claim.


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