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As your small business grows, you might consider purchasing a vehicle to use for business purposes. If you or an employee are often using your personal vehicle to drive to multiple job sites or transport clients, a company vehicle can make good sense.

Note: Any car, owned by an individual or a business, which is used for business purposes should be covered by a commercial auto policy. Personal auto policies will not cover business use. Please consult your insurance agent if you have any questions about whether or not your usage is considered “business use.”

Some pros and cons of the company vehicle

Buying a company car has several pros and cons. On the pro side, it’s one way to reinvest profits in your business, and you can often take advantage of tax benefits. A company car can be an asset, as well as a perk for you or your employees.

You may find that a company car can help you project a professional image and provide reliable transportation. And a company vehicle can even provide advertising opportunities if you choose to add a sign or professional wrap to it.

On the con side, buying a company car can be a sizeable expense. Not only does it cost money to buy in the first place, you’ll also have additional costs to register and maintain the vehicle. With a dedicated company car available, you or your employees may find yourselves on the road more often, thus exposing your business to more liability should you be in an accident.

Tips for choosing a company vehicle

If you decide buying a company vehicle is right for you, just as you would when buying a car for personal use, take time to think through your needs, research potential vehicles, and determine your budget. Some questions to consider include:

Does it make more sense to lease or own?

Should you buy new or used? New usually costs more up front, but a used vehicle may have higher maintenance costs.

What type of vehicle will be best for your needs: sedan, SUV, van, or truck?

How will the vehicle be used? Making deliveries, driving between work locations, transporting clients?

Who will drive it?

How often will it be used?

What features are important to you, such as comfort, fuel economy, safety features, or a warranty?

What type of image does your business wants to project?

What will be the ongoing costs of owning and maintaining each possible company vehicle?

Tip: While you’re in the research stage, call your insurance agent to see how much commercial car insurance will cost for the vehicles you’re interested in. Some makes and models are expensive or hard to insure—don’t wait until you’ve bought the vehicle to find this out!

Call L & M Insurance Group for your commercial auto needs

Once you’ve decided on a vehicle, make sure you protect your investment with commercial auto insurance. Just like personal auto policies, commercial auto policies can cover liability, property damage, comprehensive and collision, coverage for injuries, and coverage for uninsured motorists. The policies do differ in some technical respects, so consult with an experienced insurance agent to discuss your options.

An independent insurance agency like L & M Insurance Group is a great place to start your search for the best commercial auto policy. We write with multiple commercial auto carriers and can help you compare rates and coverage options to suit your business needs. Please call one of our agents at 813-672-4100 or click here for an online quote. Our office is located in Riverview, and we also serve clients in Tampa, Brandon, Valrico, Lithia, and surrounding communities.