Difference between Commercial and Personal Auto Insurance? A lot of businesses have more than one car in their employ which are used for commercial purposes, such as transportation of goods or personnel. Insurance companies offer insurance plans which cover multiple vehicles under a single policy in order to accommodate their corporate clients.
In this article from Lookinsure mag, we will discuss the differences between commercial auto insurance vs personal policies, including their pricing, their uses, and finally, a list of companies with the best offers for fleet insurance.
Frequently Answered Questions
How much does commercial auto insurance cost?
Since commercial vehicles are more prone to risks because of their usage type, their premium cost is usually higher than that of personal car policies. Depending on multiple factors commercial auto insurance vs personal auto insurance can cost between AED 3000 to 8000 and above.
How does commercial auto insurance work?
Commercial auto insurance works quite similarly to other types of car insurance, which involves providing the insurance provider with the vehicle’s and the driver’s information, which is used by the agent to determine the cost of premium.
Why do you need commercial auto insurance?
Since vehicles that are used for commercial purposes usually involve a higher risk of accidents, they require a specific type of policy that addresses those risks. Also, it is more financially justified for businesses that have multiple vehicles in their employ to insure their commercial vehicles all at once, which is another type of commercial vehicle insurance known as fleet insurance.
How much more expensive is commercial auto insurance vs personal?
Depending on the type of insurance, the add-ons, as well as other factors, commercial vehicle insurance in the UAE, commercial policies can be 50–200% more costly than personal policies, especially when vehicles are used extensively or carry valuable cargo.
What Is Commercial Auto Insurance
As you may know, all vehicles in the UAE, including commercial cars, must be insured to be road-legal. A key distinction between business auto insurance and personal policies is that commercial vehicle plans, such as Multi Car Insurance options, are available in three types based on the vehicle type and usage. You can explore these options through the Best Car Insurance Companies in Dubai.
- Light Transport Vehicles (LTV) including personnel transport vehicle
- Heavy Transport Vehicles (HTV) include larger vehicles such as trucks, vans, forklifts, and heavy machinery used at construction sites.
- Motorbike insurance for delivery bikes
Difference between Commercial and Persona Auto Insurance Coverage
As outlined in our Car Insurance Buying Guide, vehicles used by businesses often serve different purposes than personal cars. As a result, the coverage included in commercial auto insurance policies differs from that of personal car insurance plans, influenced by various factors that affect car insurance premiums
Check out the table below for a full comparison of coverage types between commercial auto Insurance vs personal ones.
| Coverage Type | Commercial Auto Insurance | Personal Auto Insurance |
| Liability Coverage | Covers bodily injury and property damage liabilities for business use, often with higher limits | Covers liability for personal driving, typically lower policy limits |
| Collision Coverage | Covers damage to business vehicles in accidents, regardless of fault | Covers damage to personal vehicles in accidents, regardless of fault |
| Comprehensive Coverage | Covers damage to business vehicles from theft, vandalism, weather, etc. | Covers similar non-collision risks for personal vehicles |
| Medical Payments (MedPay) | Covers medical costs for employees/passengers in a business vehicle | Covers medical expenses for the driver and passengers in personal use |
| Uninsured/ Underinsured Motorist | Covers damages to business vehicles and medical costs if the other driver is uninsured/underinsured | Covers personal vehicle damage and medical costs in similar situations |
| Hired and Non-Owned Auto | Covers liabilities for rented/leased vehicles or employees’ vehicles used for business | Not available for personal car insurance policies, since they do not typically cover business-related rentals or employees |
| Cargo Insurance | Covers goods or equipment transported in business vehicles | Not Available for personal vehicle plans |
| Rental Reimbursement | Provides rental car coverage for business vehicles under repair | Provides rental coverage for personal vehicles under repair |
| Roadside Assistance | Covers roadside assistance for business vehicles | Similar roadside assistance coverage for personal vehicles |
| Gap Insurance | Covers the “gap” between the vehicle’s value and loan/lease balance if a business vehicle is totaled | Covers the same gap for personal vehicles if they are totaled |
Commercial Auto Insurance Cost vs Personal
When comparing the cost of car insurance, premiums for commercial and personal auto insurance depend on various factors, including comprehensive vs third-party insurance. These factors are detailed in our other blogs, and the table below outlines how they influence the cost of commercial vs personal auto insurance policies.
| Factor | Commercial Auto Insurance | Personal Auto Insurance |
| Premium Costs | Generally higher, often 1.5–3 times personal rates due to higher risk | Generally lower, covering private usage only |
| Coverage Limits | Higher coverage limits (often customizable based on business needs) | Standard coverage limits as per personal use |
| Vehicle Type and Use | Commercial vehicles, especially heavy-duty or high-use vehicles, have higher premiums | Personal vehicles (non-commercial usage) have lower premiums |
| Driver Profiles | Premiums consider multiple drivers, including employee drivers, with a risk of varying driving habits | Typically covers the primary driver and family members with similar driving habits |
| Distance and Frequency of Use | Premiums are higher since commercial vehicles often travel longer distances and have higher usage | Limited to personal commutes and social use, lower frequency typically |
| Cargo Coverage | Option to add cargo insurance, increasing cost, especially for high-value goods | N/A – personal policies don’t offer cargo coverage |
| Claims Frequency | Higher frequency of claims anticipated, as business vehicles are more active, leading to higher premiums | Lower claims frequency as personal vehicles have lower activity levels |
| Liability Risks | Higher liability limits, due to increased exposure to accidents and legal liabilities | Standard liability cover sufficient for personal driving risks |
Estimated Cost Ranges in the UAE (for comparison)
- Commercial Auto Insurance: Annually AED 3000 to 8000 or more per vehicle, depending on vehicle type, business usage, and required coverages.
- Personal Auto Insurance: AED 1200 to 3000 per vehicle per year, based on vehicle value, driver’s history, and standard coverages.
Although the cost of business auto insurance vs personal can be twice the price, since commercial vehicles are used extensively or carry valuable cargo, businesses can often adjust policy features to optimize costs based on their specific needs.
Who Needs Commercial Auto Insurance
Less people need business auto insurance vs personal policies, which are in high demand since every car on the road needs to be insured. If you are wondering whether or not you need commercial auto insurance vs personal auto insurance, you can check the list below and see if any one of them defines you.
Commercial auto insurance is necessary for individuals and businesses that use vehicles for work purposes beyond regular commuting. Here are some examples of who needs it:
- Businesses with a Fleet of Vehicles: Companies that use multiple vehicles in their daily operations for delivery purposes, such as vans or trucks require commercial auto insurance to protect these assets in the event of an accident.
- Delivery and Transportation Services: Any business involved in the transportation of goods or passengers, including couriers, taxi services, and food delivery services, needs commercial insurance to cover liability and cargo.
- Tradespeople and Contractors: Electricians, plumbers, landscapers, and other contractors who use vehicles to carry tools and equipment or travel to job sites require commercial coverage. Their vehicles are often heavily used and carry valuable equipment, which themselves might require insurance.
- Online Taxi Drivers: Uber drivers or people who work for other online taxi companies need more than personal car insurance since the frequency with which they drive directly impacts the level of risk, which itself is important in determining the commercial auto insurance vs personal cost of their premium.
- Business Owners Providing Employee-Operated Vehicles: Companies providing vehicles for employees to use, even occasionally, should have commercial coverage to protect against liabilities if an employee has an accident while driving for business purposes.
- Construction and Heavy-Duty Equipment Operators: Businesses that own construction vehicles or heavy-duty equipment, need specialized commercial insurance to cover these high-risk vehicles. Insurance for these vehicles are also offered in engineering insurance policies as well.
- Businesses Renting or Leasing Vehicles for Work: Companies that frequently rent or lease vehicles for business purposes require hired and non-owned auto coverage, a type of commercial insurance, to protect against liability and damages while using these rented vehicles.
Commercial Auto Insurance Providers in the UAE
Almost all reputable insurance companies in the UAE offer commercial auto insurance as well as personal ones. However, we have made you a little list containing the names of the top insurance providers in the region, whose reputation and reliability guarantee the best possible service in business auto insurance vs personal plans.
| Oman Insurance Company | They offer customizable policies for businesses, with coverage options for cargo, hired/non-owned vehicles, and more |
| Abu Dhabi National Insurance Company (ADNIC) | ADNIC offers add-ons for roadside assistance, personal accident coverage, and extended liability limits for commercial purposes |
| GIG Gulf (formerly AXA) | They have specialized policies for fleet management and sectors like delivery, transport, and logistics |
| Orient Insurance | They provide extensive commercial options with competitive rates for small to large fleets and added value for business vehicles |
| Dubai Islamic Insurance & Reinsurance Co. (AMAN) | Ideal for businesses seeking Takaful insurance solutions in compliance with Islamic principles |
| Salama – Islamic Arab Insurance Company | Specialized in Takaful coverage, making it suitable for businesses preferring Sharia-compliant insurance |
| Al Fujairah National Insurance Company (AFNIC) | Flexible policies for commercial auto, suitable for companies with extensive regional travel needs |
| RSA Insurance | Their policies can be tailored to the specific needs of different industries, especially transport and logistics businesses |
Call Lookinsure for Commercial Auto Insurance
If you belong to any of the groups listed above who are eligible for commercial vehicle insurance, you can trust Lookinsure as always to give you the best deals possible. However, buying such a policy online is not yet possible through our website, but you can call our dedicated customer service who will guide you through the whole procedure over the phone. Call +971 4 357 5450 for more detailed information.
Conclusion
If you drive your vehicle beyond daily usage you might require commercial Auto Insurance instead of personal insurance since personal insurance might not cover the risks involved with your driving habits. Moreover, businesses that use one or more vehicles for their daily operations also need this type of policy, which can cover multiple vehicles under one individual policy.
In this article you can find all you need to know about this insurance type, from different kinds of commercial car insurance to their coverage options and price range.
