If one of the perks of your job is a company car, then chances are your employer pays to insure that car. In that case, there's no question about which insurance policy will cover an accident. But some companies expect employees to use their own cars when they're out on company business, and if you're self-employed, you may use your car for both business and personal reasons.

This gray area between business and personal use raises a whole passel of questions about car insurance. When does the company's policy cover you and when do you have to rely on your personal auto policy? Who should you call first? If you own your own business, will your personal auto policy cover you or do you need to take out a commercial policy? And what about rental cars on business trips? The answers will depend on your specific situation.

PERSONAL CAR, COMPANY BUSINESS
Most large corporations have commercial policies that cover employees while they're traveling. If you're driving your own car on company business and you get into an accident, then chances are that your company's insurance will kick in first. Your employer should know the basics about insurance coverage for its workers. Make sure you understand how it works at your company. If you are covered through a company policy, find out from your employer who you should call and carry that information in your car. Regardless of which insurance company you talk to first (yours or your company's), you should let the adjuster know that you were traveling on business. According to Dan Kummer at the National Association of Independent Insurers, your personal auto insurance company shouldn't deny your claim because you were traveling on business, although it might try to recover the money from your employer's insurance company later. If you get into an auto accident while you're on business, it's always better to start at your employer's insurance company. The fewer claims on your personal record, the better.

TIME TO GO COMMERCIAL
If you drive around all day making sales calls, you may want to purchase higher liability limits, but your personal auto policy should suffice. However, if you get direct compensation from the use of your car - you make deliveries, or use it as a taxi or livery service - then you're going to need extra coverage. You may even need to buy a commercial policy. It may be tempting to neglect mentioning this little fact to your agent, but if you ever need to file a claim, your insurance company can deny it if it finds out you misinformed them. If you use your car more than 50 percent of the time for your business - say you're a carpenter, a landscaper, or independent contractor - then you may also need a commercial auto policy. Talk to a few different insurance agents about the way you use your car to see what they suggest and the rates they offer.

RENTING WHILE WORKING
If you're on the road for your company and you have to rent a car, make sure you let the rental-car company know that you're there on business. Include the name of your company along with your own name on the reservation. That way, if anything happens, the rental-car company will know to contact your employer's insurance carrier. If you're using the rental car for both business and personal reasons, the insurance company may have to determine whether you were on the clock at the time of the accident. If you get into a fender-bender during rush hour, then chances are your employer's insurer will cover it. But if you hit a tree at 3:00 a.m. on your way back from the Sunset Lounge, then probably not. If worse comes to worst, your personal auto coverage will generally extend to rental cars. That coverage should be good in every state, plus Canada and short trips over the border into Mexico. "All contracts will cover you and automatically adjust to whatever the minimum standards are for the state," says Kummer.

For example: You bought your personal auto policy in Louisiana, where state-mandated liability limits are 10/20/10. You rent a car in Maine, where the state-mandated liability limits are 50/100/25. When you drive in Maine, you'll automatically have liability coverage of 50/100/25. (Not sure what those numbers mean? Read the explanation in our auto insurance basics.) If you carry other coverage such as comprehensive and collision on your personal policy, those will also carry over, but deductibles and exclusions will apply.

If you own your own business and you rent cars all over the country, find out whether your regular auto insurance policy includes coverage for non-owned autos. Talk to your agent and explain your situation. In some cases, it may be worthwhile to purchase a "non-owned auto" endorsement.

CAR-RENTAL INSURANCE: SHOULD YOU BUY?
Remember the episode of Seinfield when Jerry's rental car was trashed and he hadn't used the right credit card to get automatic insurance coverage? Was the actual driver covered when trouble hit? Would Jerry's own insurance have covered the car if he had some? Would yours? How much better would you do than Jerry if you had a mishap with a rental car?

The auto-rental insurance checklist below can't cover every possibility, but you may fare better in your travels if you start by answering these questions before you leave for the car-rental office:

CAR-RENTAL CHECKLIST
Have you checked your current auto policy? "We really highly recommend that customers find out from their individual insurance company or insurance agent what their automobile coverage protects them from when they rent a car," says Paula Stifter, manager of public affairs for the Hertz Corp.

Does your insurance cover rental cars and the people and things in them? Check your car owner, homeowner, home renter, and medical policies. much coverage does it give you? Does it cover bodily injury liability, property damage liability, uninsured/underinsured motorist coverage for you and your passengers' injuries, damage to your car due to an accident (collision), damage to your car due to fire and other causes (comprehensive), medical for you and your passengers, towing, and so on? Hertz recommends finding out if your rental car is covered for theft or vandalism, too - look under your homeowner or property-renter insurance. If you have questions, call your agent.

Does your own policy cover rental cars driven outside your country's borders, or does protection stop at (or a few miles over) the border of Canada or Mexico? Does your own policy cover the person sharing the driving? Does that person's policy cover them, even if your name is on the rental agreement?

CHECK YOUR CREDIT CARD COMPANY'S PROTECTION
Does your premium plastic provide automatic insurance when you use it to rent a car?

Does that coverage apply only at certain rental agencies? Hertz says to beware of protection for only certain types of cars, coverage for a maximum number of days, or coverage that pays only the deductible on your own policy. You may have to buy extra coverage or enroll in a special credit card program for the "automatic" coverage to apply.

What kind and how much coverage is provided? Many times coverage through credit cards protects only the rental car, not you, your passengers, or third parties who may sue. Note that credit card coverage may not apply if you do purchase some car-rental insurance. Ask your rental agency to fax you its options, and check out these points:

• What does the rental agency's protection cover? Coverage varies from state to state and from agency to agency.

• Note that car-rental agencies may not technically be selling insurance, but rather Loss Damage Waivers (LDWs) or other optional services. Whatever they call it, make sure it does what you need.