Does A Sole Proprietor Need Commercial Auto Insurance?

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If you’re currently registered as a sole proprietor, then you may be wondering “does a sole proprietor need commercial auto insurance?”  We get to the bottom of this commonly asked question today, explaining what a sole proprietor is and how to determine whether commercial auto insurance is necessary. 

does a sole proprietor need commercial auto insurance
Looking for Commercial Auto Insurance as a Sole Proprietor? Click HERE to get a free quote now!

What is a sole proprietor?

A sole proprietor is an unincorporated business that is owned by an individual. It is the simplest type of business in Canada. However, just because it consists of one individual doesn’t mean insurance isn’t required. Commercial insurance is crucial for all types of businesses, no matter their size or industry. Further, commercial auto insurance may also be required, depending on the operations and services your sole proprietorship offers. 

Do sole proprietors need commercial auto insurance?

The answer to this question is somewhat complicated as some sole proprietors need commercial auto insurance coverage while others don’t. If you use a vehicle for business purposes, such as to deliver products to customers, transport equipment or tools, or provide customers with a service, then chances are you need commercial auto insurance. However, if you are using a vehicle to simply commute to your office, you likely don’t need commercial auto insurance. The same goes for if you operate your business out of your home and do not make customer deliveries or travel between job sites, meetings etc. in your car.

Ultimately, if you rarely or never use your vehicle for business purposes and you are the sole owner of the vehicle (i.e. the vehicle is registered in your name and not your company’s name), then your personal auto insurance plan may offer sufficient protection. But if you rely on your vehicle for business use, it’s registered in your business’s name, or it’s frequently driven by your employees for business purposes, then you probably need commercial auto insurance and can confirm this by speaking with your personal auto insurance provider.

The right commercial auto insurance coverage for sole proprietors

Commercial auto insurance coverage varies between businesses, insurance providers, and even provinces. The types of commercial auto coverage generally available to sole proprietors in Canada are as follows: 

  • Third-party liability coverage
  • Accident benefits coverage
  • Uninsured automobile coverage
  • Direct compensation – property damage coverage
  • Collision coverage
  • Comprehensive coverage

How can I purchase commercial auto insurance as a sole proprietor? 

The good news is that if you’ve decided your business – no matter how small – requires commercial auto insurance, purchasing it couldn’t be easier, thanks to ALIGNED. Simply give us a call or contact us online and an experienced insurance broker can help you find the right commercial auto insurance for your small business. Whether you use a fleet of delivery vans or a single vehicle for business purposes, we will work tirelessly to find a policy that meets your unique needs and budget. Plus, when you purchase commercial auto insurance through a reputable brokerage like ALIGNED, you can rest easy while we do all the heavy lifting, obtaining and comparing quotes on your behalf.

Get in touch with ALIGNED to learn more about commercial auto insurance for sole proprietors

As commercial insurance experts, the ALIGNED team is always on hand to answer your questions or advise you on your coverage needs. So if you have questions about sole proprietorships and commercial auto insurance, contact us today. Click Here To Get A Quote or contact one of our business insurance experts for information or with any questions you may have.

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