Compare Independent Contractor Car Insurance Rates [2023]
If you need car insurance coverage for business use of your car, you have a variety of options, including Allstate, State Farm, and Erie. However, rates will vary among the business use insurance companies, so make sure to take the time to compare independent contractor car insurance rates.
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Michael Vereecke
Commercial Lines Coverage Specialist
Michael Vereecke is the president of Customers First Insurance Group. He has been a licensed insurance agent for over 13 years. He also carries a Commercial Lines Coverage Specialist (CLCS) Designation, providing him the expertise to spot holes in businesses’ coverage. Since 2009, he has worked with many insurance providers, giving him unique insight into the insurance market, differences in ...
Commercial Lines Coverage Specialist
UPDATED: Aug 29, 2023
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Advertiser Disclosure: We strive to help you make confident car insurance decisions. Comparison shopping should be easy. We are not affiliated with any one car insurance company and cannot guarantee quotes from any single company.
Our partnerships don’t influence our content. Our opinions are our own. To compare quotes from top car companies please enter your ZIP code above to use the free quote tool. The more quotes you compare, the more chances to save.
Editorial Guidelines: We are a free online resource for anyone interested in learning more about auto insurance. Our goal is to be an objective, third-party resource for everything auto insurance related. We update our site regularly, and all content is reviewed by auto insurance experts.
UPDATED: Aug 29, 2023
It’s all about you. We want to help you make the right coverage choices.
Advertiser Disclosure: We strive to help you make confident car insurance decisions. Comparison shopping should be easy. We are not affiliated with any one car insurance company and cannot guarantee quotes from any single company.
Our partnerships don’t influence our content. Our opinions are our own. To compare quotes from top car companies please enter your ZIP code above to use the free quote tool. The more quotes you compare, the more chances to save.
On This Page
- If you drive your personal car for business purposes, you may need to carry business car insurance
- The average commercial car insurance rates are $100-$200 a month
- Independent contractors can lower their car insurance rates by reducing their mileage
Looking to compare independent contractor car insurance rates? If you’re an independent contractor or freelancer who uses a personal vehicle for work, you need to carry business car insurance. Your personal auto insurance doesn’t cover any accidents or damages while working.
Keep reading to learn about commercial vs. personal car insurance. If you want to jump right into finding the most affordable auto insurance company for independent contractors, use our free quote comparison tool.
Do independent contractors need business car insurance?
There isn’t a specific independent contractor insurance policy, but business auto insurance will cover you if you use your personal vehicle for work.
The IRS defines an independent contractor as a non-employee hired by a company to work on a contract basis with clients of their choice. They may often use their own vehicles to chauffeur clients or passengers and deliver products.
Some common independent contractors who need business car insurance are:
- Rideshare and delivery drivers
- Administrative and personal assistants
- Physical and massage therapists
Don’t assume your personal policy automatically covers you if you’re an independent contractor. Most insurance companies will deny car insurance claims on accidents while performing your job if you don’t carry business coverage.
For example, if you’re a rideshare driver, you’re on the road more often than when driving for personal errands, increasing the likelihood of an accident. Consequently, independent contracts must carry additional commercial coverage on top of a personal policy.
What is the difference between business vs. personal car insurance?
Your personal auto insurance doesn’t cover business use of your car, and your policy will specifically exclude coverages for accidents or damages sustained while working.
The table below lists different insurance scenarios and whether business or personal car insurance covers you for it.
Personal Car Insurance
Covers You When: Commercial Car Insurance
Covers You When:
Commuting to your job site. Driving around to meet clients.
Running out to grab pizza for your fellow workers. Delivering your baked goods to customers.
Throwing a box of office supplies in the back of your car. Regularly using your vehicle to transport tools and equipment to job sites.
Not sure what constitutes “business use of your car?” Answer the following questions to determine if you need business vs. personal auto insurance:
- Do you travel to remote work locations?
- Do you make deliveries?
- Do you transport products or people?
- Do you visit clients?
- Do you haul work equipment?
If you answered yes to any questions above, buy commercial car insurance to ensure you’re adequately covered. Your rates will likely increase when you add coverage, but you can save money by maintaining a good driving record and asking for discounts.
What does a business auto policy cover?
Business car insurance provides the same coverages as a personal policy, including liability, collision, and comprehensive coverage. You can also purchase the following additional coverages with your commercial policy:
- Rental reimbursement
- Uninsured motorist insurance
- Medical payments coverage
- Roadside assistance
Your state may require some of these additional coverages depending on where you live. Research your state laws before comparing business car insurance quotes so you know you’re getting the proper coverage.
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How much does business car insurance cost?
Average business car insurance rates range between $100 and $200 per month, higher than average personal rates.
The main factors affecting your commercial car insurance rates are vehicle type, personal driving record, where you live, and how far you drive. For example, insurance rates on a large commercial truck or regular minivan will be higher than rates for a sedan.
You’ll also incur higher rates if you have multiple speeding tickets or reckless driving charges.
However, contractors who occasionally use their vehicles for work can reduce their rates based on mileage. The table below shows how standard car insurance rates can vary based on how far you drive per year.
Car Insurance Company Car Insurance Rates with 6,000 Annual Mileage Car Insurance Rates with 12,000 Annual Mileage
USAA $2,482.69 $2,591.91
Geico $3,162.64 $3,267.37
State Farm $3,175.98 $3,344.01
American Family $3,401.30 $3,484.88
Nationwide $3,437.33 $3,462.67
Progressive $4,030.02 $4,041.01
Farmers $4,179.32 $4,209.22
Travelers $4,399.85 $4,469.96
Allstate $4,841.71 $4,934.20
Liberty Mutual $5,995.27 $6,151.63
Some factors influencing commercial car insurance rates are out of your control. However, shopping around with multiple companies can help you find the most affordable business car insurance companies in your neighborhood.
What are the best car insurance companies for independent contractors?
The best commercial auto insurance company for you depends on where you live and how often you use your personal vehicle for business use. For example, you may be able to save money with limited delivery driver car insurance.
When comparing companies online, examine each company’s policy offerings and read customer reviews. You want to find an insurer offering the right business policies at affordable rates and a fast and friendly claims process.
J.D. Power ranks commercial car insurance companies based on product selection, price, and customer service. The top seven business car insurance companies are:
- Allstate
- State Farm
- Erie
- Farmers
- Chubb
- Travelers
- Nationwide
All top insurers are available in all 50 states, except for Nationwide and Erie. However, you may find a local company specializing in business auto at competitive rates. Compare quotes from at least three companies in your area to find the best price for your policy.
What You Need to Know About Business Car Insurance for Independent Contractors
A personal policy doesn’t cover business use of your car. Consequently, you need to carry business coverage if you’re an independent contractor and use your personal vehicle for work.
Independent contractors who haul equipment, travel to worksites, or deliver products/passengers need a business auto policy. With this increased risk level, insurance companies require additional coverage to protect themselves and you against damages.
Business car insurance costs between $100 and $200 per month, but you can lower your rates by maintaining a good driving record and reducing your annual mileage. Independent contractors who occasionally use their vehicles for work will have the lowest commercial car insurance rates.
Frequently Asked Questions
Do independent contractors need business car insurance?
Yes, if you use your personal vehicle for work as an independent contractor, you need business car insurance.
What is the difference between business and personal car insurance?
Personal car insurance doesn’t cover accidents or damages that occur while working, whereas business car insurance provides coverage for such situations.
What does a business auto policy cover?
A business auto policy covers liability, collision, and comprehensive coverage, and additional options like hired auto coverage and non-owned auto coverage.
How much does business car insurance cost?
On average, business car insurance rates range between $100 and $200 per month, depending on factors like vehicle type, driving record, and location.
Which are the best car insurance companies for independent contractors?
The top seven commercial auto insurance companies for independent contractors, according to J.D. Power, are Allstate, State Farm, Nationwide, Erie, Farmers, Progressive, and Liberty Mutual.
Free Car Insurance Comparison
Enter your ZIP code below to view companies that have cheap car insurance rates.
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Michael Vereecke
Commercial Lines Coverage Specialist
Michael Vereecke is the president of Customers First Insurance Group. He has been a licensed insurance agent for over 13 years. He also carries a Commercial Lines Coverage Specialist (CLCS) Designation, providing him the expertise to spot holes in businesses’ coverage. Since 2009, he has worked with many insurance providers, giving him unique insight into the insurance market, differences in ...
Commercial Lines Coverage Specialist
Editorial Guidelines: We are a free online resource for anyone interested in learning more about auto insurance. Our goal is to be an objective, third-party resource for everything auto insurance related. We update our site regularly, and all content is reviewed by auto insurance experts.