If you use your personal vehicle for your work or business, you need to make sure that you have the proper insurance in place.
Depending on the work you do, the type of business you have, and the type of van you drive, you may need a different combination of policies.
If you're self-employed or a business owner using your van for work, you'll need a business van insurance policy. This covers you for delivering goods and haulage in a light commercial vehicle (LCV) weighing up to 3.5 tonnes. Vehicles over 3.5 tonnes are classed as a heavy goods vehicle (HGV) and will need a different type of policy.
Commercial van insurance is also known as business van insurance. In this article, we look at the different types of business van insurance available, what level of cover you can get, and answer questions like “do I need van insurance for my commute to work?”.
What types of business van insurance are available?
If you need to buy van insurance for work, there are 3 types of commercial van insurance to choose from:
Carriage Of Own Goods
Carriage of own goods will cover all your work and personal belongings inside the van. If you're a self-employed electrician or plumber, this will cover your tools and the equipment used to do your job. If you just use your van to commute, you will need this level of cover.
It’s sometimes also called ‘carriage of tools cover’, and as the name suggests it covers you to transport all the kit you need to do your job.
Carriage Of Goods For Hire And Reward
Carriage of goods for hire and reward is the level of cover you choose if you're making deliveries. It covers you for driving to multiple locations and transporting other people’s goods in return for payment. Takeaway food delivery drivers and self-employed couriers need this type of cover.
Haulage
Haulage cover is used by people making a single delivery to a single destination a long way away.
Different insurers will categorise deliveries and haulage in different ways. So it's always best to make sure you've got the right level of cover for your work-related activity.
What type of van insurance do I need?
If you only ever use your van for everyday social activity (like using your van to transport your bicycle to hiking trails), you'll be covered with a social, domestic and pleasure private vehicle insurance policy.
You need business van insurance if you use your van to commute to work, or for other work-related purposes. Carriage of goods insurance is required even if the vehicle is only used for commuting.
What’s the difference between business and private van insurance?
The main difference between business van insurance and private van insurance is that business van insurance covers you for commuting to and from work in your van, while private van insurance will cover you for social purposes like shopping and visiting friends.
Business van insurance is a legal requirement if you use your van for any of these reasons:
- Transporting goods or equipment
- Transporting passengers
- Commuting to your place of work
You’ll need private van insurance if you use your van for:
- Hobbies
- Visiting relatives
- Going shopping
What level of business van insurance should I choose?
There are 3 different types of commercial van insurance. You'll need to choose the best type of policy for you:
Third Party Only
- You're required to have at least third party insurance by law.
- It covers damages to other vehicles, people or property caused by your van.
- Your own van is not covered if you're involved in an accident.
Third Party, Fire and Theft
- This covers damage to other vehicles, people or property caused by your van.
- You'll be covered for damage or loss due to fire, theft, or if your personal belongings are stolen.
- Commercial property isn't typically covered.
Comprehensive
- Comprehensive commercial van insurance covers the same things as Third Party, Fire and Theft.
- In the event of a claim, it includes vehicle repair or replacement after an accident, even if you're at fault.
- it's the most comprehensive coverage, but extras may be available.
What does commercial van insurance cover?
If you use a van for work, your business van insurance will cover you. It will also give you the same basic protection as any other auto insurance policy. Depending on the level of cover and how much protection you want, it could also include:
Your Van
Your van will be protected, so you can make a claim for the cost of fixing it if it gets damaged in an accident, a fire, or is stolen or vandalised.
Third-party damage
No matter what level of coverage you choose, you'll be covered for the cost of damage you cause to a third party, their vehicle, or their property if you're at fault.
Motor legal protection
Motor legal protection is also known as legal expenses cover, and it will pay for any legal fees incurred as a result of a car insurance claim.
Personal accident cover
Personal accident cover provides compensation if you’re seriously or fatally injured in a motor accident.
Breakdown cover
If your van breaks down while you're driving, breakdown cover helps pay for the cost of calling for roadside assistance.
Courtesy van cover
If you file a claim and your van is taken off the road, you may be given a replacement vehicle until yours is recovered, repaired or declared as written off.
What isn’t covered by business van insurance?
The specifics of your coverage will depend on the business policy you've taken out, but you're not usually covered for:
- Damage from wear and tear.
- Mechanical or electrical failure.
- Theft that occurs when items are left out in the open, doors are left unlocked, or keys are left in the vehicle.
- Any uninsured goods that you’re transporting.
How much is commercial van insurance?
The average cost of business van insurance varies depending on your usage, but some types may be similar in price to a social only policy.
Your personal circumstances, such as the van you drive, whether you're employed or a sole trader, your location, and your driving history, will determine whether your quote is higher or lower.
How can I get cheaper business insurance?
To reduce the cost of your commercial van insurance, there are a few steps you can take:
Security: Lowering the risk of theft can mean lower insurance costs. If your van has factory locks and immobilisers installed, you may be able to get a cheaper policy.
Storage: Keeping your van in a locked garage, rather than parking it on the street, can help to bring the cost of your insurance down. Especially if goods are kept in it overnight.
Annual payments: Paying for your annual policy upfront is usually less expensive than spreading the cost over monthly instalments.
Excess payments: If you can, choose a higher voluntary excess payment. This shows that you won't file small claims that aren't worth the cost, so your insurance company will probably give you a discount.
Is business van insurance more expensive than personal?
The cost of business van insurance is usually higher than a private van policy. That’s because business van insurance covers you and your van for commuting and carrying out your work, which carries more insurance risk than just driving for social reasons.
What does business insurance cover on a van?
Business van insurance allows you to use your vehicle for work or business reasons. It includes repairing or replacing your damaged or stolen van so you can get back on the road quickly. Also covered are the tools, equipment, and materials stolen or damaged in transit that you need to keep operating and earning income. Additional options like breakdown assistance and courtesy vehicles further reduce disruption.
Can anyone drive a van on business insurance?
Yes. If your company owns or is listed as the owner of your van, you can get insurance for it in the name of your company.
You can also get insurance for your van that covers more than one driver. This is perfect for businesses that have more than one employee using the vehicle, or for families where more than one person uses the van for work.
Can I use my van for social, domestic and pleasure use even though I've insured a business van?
Yes, most van insurance policies cover you for personal driving as standard.
What other extras can I get for my business van insurance policy?
Some additional cover options that may be available with your business van insurance policy include:
- Misfuelling: This will cover the costs if you fill your van with the wrong fuel.
- Windscreen cover: This will pay for any damage done to your windscreen.
- Lost keys: To pay for replacement keys if you lose the originals.
Do I need van insurance for car boot sales?
Van owners often don't know if selling at car boot sales is a business or a hobby. Private insurance should be fine if you occasionally go to car boot sales and only use the van for private use, as this is a social activity. If you're a regular trader at these events, you may need business insurance.
Do I need van insurance for Classic Van Shows?
Classic van enthusiasts can count their interest as a hobby because it’s not considered a form of commercial use. However, if you own a vintage or classic van, it's worth investing in specialist insurance to get a guaranteed value policy that matches the model's value.
