If you drive to job sites, haul tools or visit customers in your truck or van, your personal auto policy may not cover you. Many personal policies limit or exclude business use, and an accident on the clock can leave you with a denied claim.
Plumbers, electricians, HVAC techs, general contractors and mobile mechanics across the South Bay face this gap every day. Here’s how to tell what you need.
Personal vs. commercial auto: the key differences
| Personal auto | Commercial auto | |
|---|---|---|
| Designed for | Commuting and personal errands | Vehicles used to run a business |
| Business use | Often limited or excluded | Covered, subject to terms |
| Employee drivers | Limited | Can list employees as drivers |
| Liability limits | Usually lower | Higher limits available, often $1M |
| Ladders, racks, signage | Often not covered | Can be included |
| Business-owned title | Generally not eligible | Required for many fleets |
Signs you need commercial auto
- The vehicle is titled to your business or LLC
- You carry tools, equipment or materials to job sites
- Employees drive the vehicle
- You transport goods or deliver products
- A client contract requires a commercial auto certificate of insurance
- You have a work truck with racks, a lift gate or signage
The gaps commercial auto doesn’t cover
Tools and equipment. Commercial auto covers the vehicle, not what’s inside. Tools in your truck usually need an inland marine or contractor’s equipment policy.
Cargo. Goods you transport for others may need motor truck cargo coverage.
Vehicles you don’t own. If an employee runs a business errand in their own car, or you rent a car for a job, hired and non-owned auto (HNOA) coverage can protect your business. It is often an affordable add-on to a commercial auto or general liability policy.
How much does commercial auto cost?
Small businesses paid a median of about $245 a month for commercial auto, and construction businesses about $264 a month, according to Insureon data on 100,000 small business owners (updated March 2026). Your price depends on vehicles, drivers, limits, location and claims history.
Get your work vehicle reviewed
SmartPath Insurance is an independent agency in El Segundo that writes commercial auto, general liability, workers’ comp and tools coverage for contractors across Los Angeles. We can compare carriers including Progressive, Mercury and others for eligible businesses, and package your vehicle, tools and liability together.
Call (310) 751-5979 or request a commercial quote.
Frequently asked questions
Does personal auto insurance cover business use in California? It depends on the policy. Many personal policies limit or exclude business use, especially for hauling tools, making deliveries or carrying goods. Check your policy or ask your agent.
Do I need commercial auto if I’m a sole proprietor? Possibly. If you use the vehicle mainly for work or it is titled to your business, commercial auto is often the better fit.
Are my tools covered by commercial auto insurance? Usually not. Tools and equipment in your vehicle typically need inland marine or contractor’s equipment coverage.
What is hired and non-owned auto insurance? It covers your business’s liability when employees drive their own cars or rented vehicles for work. It doesn’t cover damage to the vehicle itself.
SmartPath Insurance Services · 841 Apollo St., #470, El Segundo, CA 90245 · CA Lic. #6004439. This article is general information. Coverage is subject to policy terms and eligibility.
Sources: Insureon: Commercial auto insurance cost (updated Mar 4, 2026)
Written by Richard Nguyen, Founder, SmartPath Insurance Services.