Business car insurance: business use, company cars and fleets
Business car insurance can mean two things: an ordinary car policy with business use declared, or a commercial motor policy for vehicles a business owns. Either way, what matters is telling the insurer how the car is really used, because policies define private use narrowly and treat use for earning an income differently.
This page sets out how insurers define private and business use, when a business-owned car needs a commercial policy, how tools and business goods in the car are treated, and what rideshare and delivery work do to your cover. It quotes the insurers' own documents, read on 2 October 2026.
By Better Rate Mate Editorial Team ยท Last reviewed
Private use or business use?
Driving to and from your regular workplace usually counts as private use. AAMI's PDS says private use means the car is not used in connection with earning any income, and that travel to and from your place of work is private use. Budget Direct defines private use as social, domestic and pleasure use plus travelling between home and a regular place of work.
Using the car to earn an income is different: visiting clients, driving between job sites, or carrying stock or equipment as part of your work. Each insurer handles that in its own way, so the definitions below matter more than the label on the policy.
| Insurer | What counts as private use | Business use | Document |
|---|---|---|---|
| AAMI | Not used in connection with earning any income; travel to and from work is private use | Tell AAMI if the car is no longer for private use only. Its target market includes business use connected with earning an income from an acceptable occupation | Comprehensive Car Insurance PDS (prepared 18 September 2020); Target Market Determination (updated 27 June 2025) |
| Budget Direct | Social, domestic and pleasure use, plus travel between home and a regular place of work | Occasional business use is allowed where the car is not registered for business use and is not an essential part of earning an income. Under Private and Business Use, any driver who uses the car for business must be listed | Supplementary PDS (prepared 11 December 2025) |
| NRMA Insurance | No separate definition quoted here | No cover for use for any business, trade or profession unless that business, trade or profession is shown on your certificate of insurance | Car Insurance PDS (prepared 10 September 2023) |
Does my car insurance cover me for business use?
Only if the policy allows it and you have declared it. A car policy can cover business use, but some insurers need the specific business shown on your certificate, some need every driver who uses the car for business listed, and all of them rely on what you tell them. Undeclared use can lead to a reduced or refused claim, so if your use has changed, tell your insurer before you renew, not after a crash.
Cars owned by a business or company
A car registered to your business can still suit a car policy in some cases, but company cars run as a fleet usually need a commercial policy. AAMI's Target Market Determination, for example, says its car insurance is not suitable for company-owned cars used as fleet cars, hire cars, ridesharing or car schemes.
Commercial motor policies are built for business vehicles. AAMI's Commercial Motor Insurance covers cars, utes, 4WDs, trucks with a carrying capacity of up to 5 tonnes, trailers and some industrial vehicles. NRMA's Commercial Motor Vehicle Insurance can cover up to 5 business vehicles bought online, or up to 20 by phone, and NRMA also has a separate fleet policy.
Is it cheaper to insure a car under a business? There is no general answer: the premium follows the vehicle, how it is used and who drives it, not just who owns it. One cost difference is tax. In Queensland, MAIC says a business that uses a vehicle for business purposes may be able to claim the GST on its CTP premium as an input tax credit; ask your tax adviser or the ATO how that applies to your other insurance.
Tools and business goods in the car
Car policies cover personal belongings only to a limit, and most leave tools out. AAMI's personal property cover excludes tools and items used for a business, trade or profession, and Budget Direct's personal effects cover excludes tools of trade. NRMA's Comprehensive Plus and Comprehensive policies include tools of trade up to $1,500, but cover theft only from a locked car or tool box with signs of forced entry.
If your tools are worth more than that, cover them under a business policy. Our guide to tradie insurance explains the options.
Rideshare and delivery
Carrying paying passengers or other people's goods is a different risk again, and insurers treat it very differently.
| Insurer | Rideshare | Delivery for payment |
|---|---|---|
| AAMI | Covered: the PDS excludes use for hire, fare or monetary reward but says it will provide cover if the car is used for ridesharing | Not named in the PDS; the hire, fare or monetary reward exclusion applies, so ask AAMI before delivering for pay |
| Budget Direct | Never covered: carrying passengers for payment, including taxis and ridesharing | Never covered: carrying or delivering other people's goods for payment, such as parcel or food delivery |
| NRMA Insurance | Covered only if rideshare use is shown on your certificate, within the hours you declared | Excluded unless the specific use is shown on your certificate |
Business vehicles and your other insurance
Car insurance covers the vehicle and the damage it does to other people's property. Injuries are a separate matter: they fall under the CTP or compulsory injury scheme in each state, and if an employee is hurt while driving for work, workers compensation can apply first. In Victoria the TAC asks people injured while working to lodge a WorkSafe claim first, and the NT's MAC Scheme excludes people injured in the course of their employment.
For the rest of your business cover, see our guides to business insurance and workers compensation.
What to watch for
- Commuting is private use. Using the car to earn an income is business use, and it needs declaring.
- Some insurers need the specific business on your certificate, or every business driver listed.
- Tools are often excluded from personal property cover, or capped. Insure them under a business policy if they are valuable.
- Rideshare and delivery are treated very differently: covered by one insurer, never covered by another.
- A car the business runs as a fleet usually needs a commercial or fleet policy, not a private car policy.
Common questions
Does my car insurance cover me for business use?
Only if the policy allows it and you have declared it. NRMA, for example, does not cover use for a business, trade or profession unless it is shown on your certificate, and Budget Direct needs every driver who uses the car for business listed under its Private and Business Use option.
Is it cheaper to insure a car under a business?
There is no general answer. The premium follows the vehicle, how it is used and who drives it. A business may be able to claim GST credits on some insurance premiums: in Queensland, MAIC says a business using a vehicle for business purposes may claim the GST on its CTP premium. Ask your tax adviser or the ATO.
What is the difference between commercial and business use?
Insurers use the terms in different ways. Broadly, a car policy with business use declared covers a private car that is also used to earn an income, while a commercial motor policy is a separate product for business vehicles such as cars, utes, trucks and trailers, often several at once. Check which one an insurer means.
Do I need to tell my insurer if I use my car for work?
If the use goes beyond driving to and from your regular workplace, yes. AAMI asks you to tell it if the car is no longer for private use only, and undeclared use can lead to a reduced or refused claim.
Are my work tools covered in my car?
Often not, or only up to a limit. AAMI and Budget Direct exclude tools from their personal property cover, while NRMA's comprehensive policies cover tools of trade up to $1,500, with theft covered only from a locked car or tool box with forced entry.
Does car insurance cover Uber or food delivery?
It depends on the insurer. AAMI's PDS says it covers ridesharing, NRMA covers it only if rideshare use is shown on your certificate, and Budget Direct never covers carrying paying passengers or delivering goods for payment.
