What counts as business use for a car?

[stephen1974]

An employee came to me today and asked this as they have been asked to pick other employees up and take them to one of our sites, and then take them back. Their parents freaked out and said you can't do that because you won't be insured. I was initially inclined to agree, but advised speaking to their insurer, which they said they had, but I dont believe they did. However, I started thinking about it a bit more.

(I also think the employee is looking for a way out of having to get up at 4am to pick people up at 5am for a 6am start - and blinking rightly so IMO, the company has mucked up and is looking for kids to put themselves out to bail the company out and if they do it once it will set a precedent and they'll be expected to do it again and again)

Now, as a nation, we are constantly advised to car pool to save the environment, ease congestion etc, and whilst it was hard to find anything on the internet beisde "buy our insurance" I did find this.

(This is from a company called liftshare which help organise, lift sharing)

What are the legal and insurance implications of car sharing?

The Public Passenger Vehicle Act (1981 Section 1(4)) outlines the rules that govern car sharing. Passenger contributions should be arranged before travel and should not exceed the running costs (including wear and depreciation) of the vehicle for the trip. Liftshare calculates a suggested price per passenger for your journey based on the length of your trip and using HM Revenue and Customs Approved Mileage Payment Allowance.

In most countries, insurers state that car sharing will not affect an individual's car insurance e.g. the Association of British Insurers clearly states that car sharing won't affect the insurance of their members so long as a profit isn't made: "All ABI motor insurers have agreed that if your passengers contribute towards your running costs your insurance cover will not be affected, as long as lifts are given in a vehicle seating eight passengers or less. This agreement does not apply if you make a profit from payments received or if carrying passengers is your business" (Source: ABI 2012)

(Like me, they also suggest checking with your car insurer as not all insurers are ABI members)

This suggests that it would be ok as long as you are not making a profit from the passengers or that carrying pasangers is the nature of your business.

Other things i've read, suggest otherwise and that even something like dropping your wife off at her place of work whislt on the way to yours can invalidate your insurance (though that was a tabloid newspaper article)

Just wondering if anyone has any experience of this?

[Andyblue]

We’re looking at two issues, is it for work and are they insured. At the moment we don’t know if the driver was instructed to make the collection or a vague suggestion to help fellow workers. What would happen if the driver didn’t do the collection, are they paid extra for the added time etc.
Insurance is entirely a matter of the driver and what the policy says. We are suggesting it’s a new/young driver, whom may have a reduced premium for lots of reason, such a no passengers except family, limited hours of driving.
Car sharing is almost a red herring at the moment. Let’s remember groups of workers regularly create a lift system between themselves, contributing to fuel, taking turns, buy drivers lunch etc, it’s encouraged to reduce congestion. If our driver is driving an additional hour each day, then a contribution may not be unreasonable.

[stephen1974]

Lets assume the driver has no restriction on passengers - they didnt mention any and they would have at the time.

The driver coulld put in a claim of mileage if they wanted to but they wouldn't get paid for the hour of travelling time. It would be like a change of venue for their work day. (I think thats the main issue here and why they would need business insurance)

If the employees didnt turn up the company would be up poop creek. They are doing this because a whole bunch of staff just left one site and they just dont have a enough local staff to do the job - it is man power intensive. It wouldnt be a one off either it would be twice a week pretty much every week until they replaced the staff they lost, and im not sure they will do that if then can ferry people in from other sites.

[SKD]

To me, if asked to be done by the organisation, I would class it as business use as it's for the purpose of the organisation.

I'm only saying this as I have read some insurance policies in the past that stated even going to a training course on behalf of an organisation is considered a business use.

from gocompare.com

"you need to be aware that a 'social, domestic, pleasure and commuting' policy won't cover you if you're using the vehicle for business use, such as driving to meet clients or transporting other members of staff.

If you use your car for your job - for anything other than driving to a single place of work - then you almost certainly need business car insurance.

Otherwise, you risk finding yourself without cover when you need to make a claim.

Common business journeys that may not be covered by a private policy include:

Travelling to a training course
Going to the bank
Driving to the post office
Driving to another office
Attending company away days"


Regards

George

[Andyblue]

On the updated info for our driver, it reads they can’t decline to do it,so it’s work time, it’s mileage claim and business insurance
The best result is for our driver to develop a fault and lose use of the vehicle - roadside penalty for wrong (no ) insurance would be vehicle seizures, points and fine for driver and company being interviewed for use/cause/permit had no insurance

[bernicarey]

It's business use, simple as that.

And as Andyblue said, that likely to result in car seizure for no insurance.

Other Insurance company websites are available.
Even SDP doesn't cover commuting to work....
https://www.aviva.co.uk/frequently-aske ... swer/3004/

[Siblo]

Hi All,

I found this thread while researching a new driving policy brief.

Useful link I found was https://www.rospa.com/road-safety/resou ... employers/

Near the bottom on the right is the "Using Own Vehicle" booklet (grey fleet), it rightly points out that when an employer expects or requests an employee to use their own vehicle it is the EMPLOYERS responsibility to make sure everything is in place, tax, mot, ins, etc... road worthy

Hope this helps, some good info there..

Si

[Alexis]

Hi All,

I found this thread while researching a new driving policy brief.

Useful link I found was https://www.rospa.com/road-safety/resou ... employers/

Near the bottom on the right is the "Using Own Vehicle" booklet (grey fleet), it rightly points out that when an employer expects or requests an employee to use their own vehicle it is the EMPLOYERS responsibility to make sure everything is in place, tax, mot, ins, etc... road worthy

Hope this helps, some good info there..

Si

Many thanks Si.