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If you are using your car for business purposes, then you will need business car insurance. However, finding a policy that suits your budget and gives you the protection you need can be tough to find. Thanks to our Cheapest Price Guarantee*, we promise to beat any other online quote so you can be confident about getting the best deal around.

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  • Can I get temporary business car insurance?
  • How much is business car insurance in the UK?
  • Do I need business car insurance if I have a company car?
  • FAQs
  • Useful links
  • Customer reviews

Jump to section

  • Can I get temporary business car insurance?
  • How much is business car insurance in the UK?
  • Do I need business car insurance if I have a company car?
  • FAQs
  • Useful links
  • Customer reviews

What is business car insurance?

Business car insurance covers your car when you use it for work. Typically, a standard policy will only provide you with cover for social use and commuting. However, a business car insurance policy can provide you with cover for travelling to regional offices, driving colleagues to meetings or visiting clients at different locations.

There are different classes of use for your car, so make sure you select the right one when purchasing your car insurance:

  • Business car insurance: will provide you with cover if you use your car for work-related purposes
  • Social only: will provide you with cover for your everyday driving; going to the shops or visiting family
  • Social and commuting: will provide you with cover for your everyday driving but also covers you to commute to your place of work

What does business car insurance cover?

Like other types of car insurance, you can choose from one of three levels of cover:

Comprehensive

Comprehensive policies, also known as fully comp, include third-party, fire and theft and will also cover the cost of damage to your own car if you’re involved in an accident.

Third-party, fire and theft

Third-party, fire and theft, also known as TPFT, includes third-party only cover and will also compensate you if your car is stolen or damaged by fire.

Third-party only

Third-party only, also known as TPO, compensates other people for injury and damage you cause.

Do I need business car insurance?

If you drive to lots of different places as part of your job, then you’re likely to need business car insurance. Plus, if you are involved in an accident whilst using your car for work and don’t have the correct cover, you won’t be able to make a claim. Standard policies typically only cover you to drive your car for social and domestic purposes and to a single place of work (these are known as classes of use).

Crucially, standard car cover policies don’t allow you to drive to multiple places of work so if you regularly travel between regional offices, drive colleagues to meetings or visit clients, you’ll need business car insurance.

Some other reasons you may need business car insurance are:

  • You run business errands during the day
  • Drive colleagues or business contacts around
  • Allow other employees to drive your car

There are three main classes of business car insurance, all depending on the type of cover you need:

  • Business car insurance class 1: is usually the cheapest class of business car insurance. It will cover your car if you are using it to drive between multiple work locations, or if you are visiting clients and customers, for example if you were an area manager and travelled to different sites and branches.
  • Business car insurance class 2: this class of cover includes the same coverage as class 1 but also allows you to add a named driver to the policy. This is useful if you need a co-worker to be insured to drive the same car.
  • Business car insurance class 3: is usually the most expensive class of business insurance as it covers you to drive long-distance as part of your business use. This class will be a good idea if you are a door-to-door salesman.

Business classes of use should also allow you to drive your car for social and domestic purposes too but always read your insurer’s terms and conditions to be on the safe side.

How can I get cheap business car insurance?

Your policy should always reflect your needs, but there are several ways to keep premiums as low as possible, including:

  • Paying for your policy annually — installments might help you spread the cost but they’ll also include interest and bump up the overall price.
  • Choosing the right car — cars in lower insurance groups generally cost less to insure.
  • Keeping your car safe — minimising the risk of theft or vandalism can shave a few pounds off your premium. If you don’t have a garage, you could invest in an alarm or immobiliser.
  • Increasing your voluntary excess — this can lower your overall premium but whatever the amount is, it needs to be affordable because a claim can’t go ahead until you’ve paid it.
  • Ensure your mileage is accurate – so you are only paying for the miles you will drive.

The price of your insurance policy is based on a variety of factors and circumstances, not just the number of miles you are planning to drive. Here is the information you will need to hand when comparing your business car insurance quotes:

  • The make and model of your car
  • The year your car was registered
  • Your age, address, and what job you do
  • Your occupation, address and age
  • Any points you have on your licence
  • Estimated annual mileage

Complete our simple online form today and start comparing your business car insurance with mustard.co.uk. You can search and compare business car insurance and commercial car insurance quotes, from 70 leading UK providers.

Is commercial car insurance the same as business car cover?

Technically, they’re not the same. Car insurance for business use covers you to drive your car to and from different work locations — in other words, it’s a means of transport.

On the other hand, commercial car insurance covers your car if it’s essential to your job — for example, if you’re a taxi driver or courier. In this sense, your car is integral to what you do and you couldn’t work without it (rather than it just getting you from A to B).

What can be confusing is that both terms are often used interchangeably. Some insurers will treat commercial car cover as a type of business car insurance whereas others will consider it a totally different type of insurance product.

It’s crucial to make sure that the type of policy you buy covers the way you use your car (known as the ‘class of use’). If you don’t have appropriate cover, your policy could be invalid which means your insurer can refuse to pay out.

Business car insurance FAQs

Do I need business car insurance or commercial car cover?

If you regularly drive to different locations for work but your car is simply a means of transport, then business car insurance may be the most suitable type of policy.

If you need your car in order to do your job (for example if delivering takeaways) then commercial car insurance is likely to be the best policy for you.

Confusingly, business and commercial car insurance are often used as one and the same, but they sometimes cover quite different things. For some insurers, commercial car insurance is simply another type of business car cover but for others the definition is distinct and it’s a different type of insurance product.

If you’re in any doubt about what insurance you need, always speak to your insurer who’ll be able to give you specific advice based on your unique circumstances.

Can I get temporary business car insurance?

Yes, if you only drive to multiple work locations at certain times of the year or every now and again, temporary or short-term car insurance is another option.

Temporary business car insurance can be more cost-effective and with policies offering cover for as little as a day up to a few weeks, they’re flexible too. Meaning that you are only paying for the time you use the car and the miles you are going to be driving. Temporary business car insurance is only worth getting if you are not using your car often for business use

How much is business car insurance in the UK?

Like other types of car cover, the cost of business car insurance really depends on your own circumstances and insurers will consider numerous factors, including:

  • Your job
  • The number of miles you cover
  • The driving history of any named drivers
  • The class of use you need (class 1,2,3 or commercial cover).

Using this information insurers will calculate a premium based on the risk of a claim being made. For example, if you work in sales, cover thousands of miles a year and opt for class 3, your policy is likely to cost more compared to an accountant who travels between two offices and only needs class 1.

Do I need business car insurance if I have a company car?

If you have a company car, then the company is already likely to have the right level of car insurance you need. However, you should always check with your employer to make sure you are fully insured on the company car, as well as having the right level of cover. This will ensure that if you are to get into an accident, then you are covered and will be able to claim on the insurance as well.

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