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Cars And Business: A Conflicted Relationship


Cars have been an essential asset of a business life since they’ve become a popular mean of transport. Many recruiters ask their applicants whether they have a driving license and a vehicle, meaning that it can be difficult to gain access to all jobs without one or the other.

However, for a lot of employees, owning a car can become a real taxing and insuring challenge when you use your vehicle as part of your professional activities. Indeed, more and more companies opt for direct repayment of exceptional commute journeys that an employee has to take for professional purposes in their own car – such as visiting a client out of town, for instance. Employees can claim mileage payment assuming receipts and accurate calculations. If the company doesn’t provide a payback option, you can claim tax deductions for your journeys – but you can’t claim deductions for your day-to-day commute to the office. Some companies demand that you add your work address on the insurance cover as part of their corporate tax management.

But if you thought that the whole tax and insurance story ended there, you were wrong!

Insurance, liability, and protection.

The most crucial question when it comes to cars is whether you need a specific insurance cover for a vehicle that is used in a professional environment. The answer is not completely straightforward. A business vehicle, for instance, can be insured in the name of the company if it part of a fleet that is used by employees without distinction.

But the company can choose to take car insurance in your name if the vehicle is your own professional vehicle. If you work in an environment where you need to drive cars that aren’t yours such as a salesman who delivers the vehicle at the address of the buyer, you will need what is called motor trade insurance to cover road risk. The same applies to mechanics – who need to drive a vehicle to carry out their work –, valeters, car jockeys, and recovery agents. You’ll need insurance even if you opt for junk vehicles.

A car is not a perk anymore.

At the age of recruitment challenges – and especially on the difficulties to acquire new talent – businesses need to be creative when it comes to perks. With over 40 million Americans relocating each year for employment reasons – among other things – companies can’t rely on traditional perks to appeal to new employees. A business vehicle is not appealing anymore. Most households already own a car! However, the offer to pay for the relocation costs can make a great deal of difference.

What if driving is your job?

Do professional and hobby racing drivers need car insurance? The answer is yes; you need a cover that is dedicated to the motorsport industry. The cover will offer protection for races on tracks, rally events, storage, and transit purposes as well as liability. However, you will need a different type of cover for any vehicle that isn’t used on a track.

How do you best manage driving in a business environment? The answer is not completely straightforward when your looking to insure car. You need to figure out where the vehicle comes from – company fleet, business car, personal vehicle, etc. – to define the level of insurance cover required. Additionally, different professions will require specific covers, such as traders or rally drivers.

In other words, there’s more to car insurance than you thought!


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