“Finding the right auto insurance can be a tricky task, especially when it comes to deciding whose name it should be under. Should it be in your personal name or your company’s name? In this article, we’ll explore the factors to consider to help you make the right choice.”
Understanding Liability Protection
When it comes to liability protection, having some form of insurance is essential. But who should be listed as the insured party? The answer to this question depends on various factors, including state requirements and the ownership of the vehicle.
For instance, in Nevada, the vehicle itself needs to be insured. So if your name is on the vehicle’s registration, it’s crucial to have insurance in your name. On the other hand, if you want the vehicle to be registered under your company’s name, you need to ensure that the company has insurance coverage.
Balancing Personal and Business Use
If you primarily use the vehicle for personal purposes and less than 50% for business, it’s generally advisable to keep the vehicle in your own name. This allows you to take advantage of beneficial acts provisions like depreciation deductions.
However, if your vehicle is owned and insured by your company, any accidents involving the vehicle can potentially bring liability into your business. Therefore, it’s crucial to carefully consider the reality of your business’s need for a company-owned vehicle. Construction companies or businesses with multiple crews may find it more advantageous to have vehicles under their name.
For most individuals, it’s more beneficial to reimburse themselves for business mileage rather than owning a company vehicle. By using apps like MileIQ, you can easily track and claim your business mileage for reimbursement.
Additional Considerations
When it comes to protecting your business from potential lawsuits, having the right insurance policies in place is vital. If your business requires employees to have access to vehicles, your business should have a policy that ensures employees maintain their own insurance coverage.
In terms of actual insurance coverage, your personal vehicle insurance can also offer coverage for business use. However, it’s important to notify your insurance provider if your vehicle use exceeds 50% for business. This may result in a change in your coverage and potentially higher premiums.
Remember, the intention behind vehicle use is a crucial factor in determining whether expenses, such as mileage, are deductible. While wrapping your vehicle with marketing decals may be a great advertisement strategy, it doesn’t automatically make every mile driven reimbursable. The purpose of each trip, whether it’s for business or personal use, ultimately determines what can be claimed.
Making the Right Decision
Ultimately, the decision of whether your auto insurance should be in your name or your company’s name depends on your specific circumstances. It’s essential to evaluate if the benefits of having a company-owned vehicle outweigh the potential drawbacks and costs.
At F4VN, we understand the complexities of auto insurance and aim to provide you with the information you need to make informed decisions. Whether you choose to insure the vehicle in your name or your company’s name, remember that having the appropriate coverage is essential for your peace of mind and protection.
For more insights on insurance and other financial topics, visit us at F4VN. We’re here to help you navigate the world of personal finance and make the best choices for your financial well-being.
