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Car Insurance If You Work From Home

With more and more organizations adopting policies that allow employees to work from home – either full-time or part-time – it is time to review how this change can affect your car insurance premium. When considering car insurance for WFH employees, there are several areas that you should consider. In this post, we will drill down on how your insurance needs may have changed with the shift to home-based work and explore how this may help reduce your premium.

Frequently Asked Questions

Should I tell my car insurance company I work from home?

Any time your personal circumstances change, you should advise your insurance provider. This includes a change in address, relationship status (sometimes common-law and married couples pay less for insurance), having a teen with a new driver’s license, or adding a new addition to your home. It is especially true when your standard home-to-work commute changes or you start to use your car differently.

Your insurance professional will be able to explain how the change to working from home may impact your insurance needs and they will offer options to amend your coverage and possibly reduce your premium.

"You'll be done in 3 minutes" beside a black and white hand holding a pocket watch. "Get low guaranteed car insurance rates! Right this way!""

How does insurance work if you work remotely?

When you work from home part-time or full-time, your home and car insurance needs change.

Two of the factors that affect your car insurance premium are the distance you drive each year and how far you commute to work. Depending on the distance between your workplace and your home, the move to work from home could dramatically affect both of these factors.

For example, by not commuting to work every day, the number of miles you drive each year could be dramatically reduced, lowering your premium accordingly. Similarly, if you are now working from home 100% of the time, the usage of your car changes from “commute to work” to “pleasure use” potentially providing a substantial discount on your car insurance premium.

Home insurance should also be considered when you shift to working from home. Depending on the type of work you do, you may suddenly be in possession of expensive computers or other electronic equipment that needs to be protected. If your work involves keeping stock in your home, it is important to determine who is responsible in case of damage or theft and what insurance would respond to those situations.

Check out our home business insurance policy guide for entrepreneurs and freelancers.

If you are expected to meet with other employees, customers or suppliers in your home, there is a liability exposure that needs to be evaluated and insurance protection put in place. This will protect you in the event of someone slipping on your stairs or suffering any other injury while on your property. In some cases, your employer may have insurance in place to respond to these types of situations, but in many cases, you will be responsible for ensuring that appropriate coverage is in place.

As with every insurance topic, there are many factors to consider before making a decision on changing your policy and we strongly recommend that you have a conversation with an insurance professional to determine your unique insurance needs and to design a solution that ensures you are protected and paying for only the required coverage for your living and working circumstances.

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Which type of insurance should I avoid?

Insurance is heavily regulated in Ontario and Alberta and auto insurance policies are standardized. Therefore, every insurer in each province must meet the same policy requirements, for example, a minimum of $200,000 in third-party liability coverage. Don’t assume that every company offers the exact same product and service, however.

Since every company offers similar policy contracts and terms, there are only three main ways to reduce the amount they charge for insurance coverage: reduce service levels, reduce the amount they pay in claims or increase their profit.

Reducing service levels can have a huge impact on your customer experience with the company. You can expect longer hold times when you call for assistance. You may also experience agents that only do the bare minimum when customizing a solution to meet your particular needs or when responding to issues that may arise.

An insurance company reducing their level of claims service and payouts can be distressing to discover after you’ve filed an insurance claim. A tightening of claims response and payout results in longer claims settlement periods, fewer interactions with an adjuster to answer any of your questions and an approach to claims settlement designed to pay you the absolute minimum required by the contract.

We strongly suggest you avoid buying insurance from a provider based on price alone. Before changing insurers, be sure to read service and claims reviews. It’s savvy to check out Facebook and Google reviews before purchasing your policy.

Save up to 50% on home insurance and up to 18% on car insurance by bundling your home and car insurance policies. Start my quote now

Can I lower my car insurance rates if I’m working from home?

There are quite a few ways that working from home can reduce your car insurance rates. Some of these are as simple as calling your insurance provider while others require you to evaluate the impact they may have on your insurance protection.

As outlined above, you may be able to easily reduce the number of miles you drive annually to reflect your new non-commuting lifestyle. You should discuss with your insurance professional if your new normal allows you to change the usage of your vehicle from commuting to work to driving for leisure.

You should also consider signing up for a usage-based insurance policy. These policies track your mileage and driving habits and reward safe drivers. Generally speaking, usage-based insurance tracks the following driving characteristics:

• Time of day
• Location of where you drive (roads and highways you frequent and the amount you drive in urban versus rural areas)
• Kilometres driven
• Speed
• Acceleration speed
• Instances of hard braking
• Mobile phone use

While there are several usage-based programs in Ontario and Alberta, our partner, Aviva offers a usage-based program called Aviva Journey. With this program, you receive a 10% discount upon signing up and you can save an additional 20% if you drive carefully and safely. Be forewarned, however, driving unsafely could result in your premium increasing by 5%.

In addition, you can explore other ways to lower your insurance premium while considering your reduced use of a vehicle, such as:
• Increasing your deductible
• Reducing or cutting some driving coverages such as collision insurance
• Switching from a monthly to an annual payment plan

Working from home offers employees many benefits, with one of those benefits being a possible reduction in your insurance premium. To learn more about how working from home can help you save on insurance, get your 3-minute quote or give us a call to discuss your coverage options.

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