Commercial fleet insurance can become the biggest drain in a company’s resources if their fleet grows too quickly. Taking care of a growing fleet can ruin your budget unless you find ways to lower the costs. On the other hand, you will still need exceptional insurance coverage to protect your company from accidents.
So, how do you strike that fine balance? Read on to find out how to lower costs for your commercial fleet insurance.
Understanding Commercial Fleet Insurance
Commercial fleet insurance, also known as commercial auto insurance, can cover all vehicle types a company uses to conduct its business. These include trucks, cars, and most types of motorized equipment.
Such type of insurance covers your company against bodily injury liability, as well as property damage while operating a company vehicle. Commercial fleet insurance will also cover all associated medical and personal injury protection (PIP) costs for anyone riding in any of the insured vehicles.
You may extend your commercial fleet insurance to cover liabilities that arise from using rented or leased vehicles. The same holds true for non-owned vehicles your employees may use. This includes employees using their own vehicles for company business.
Since each fleet is different and every company has unique needs and goals, fleet insurance should be tailored to each company’s needs. Let’s see how this can drive costs down below.
Insuring Multiple Vehicles
In general terms, the more vehicles and drivers you insure, the less expensive your commercial fleet insurance will be per-vehicle.
Having more vehicles does increase your exposure to having an accident. However, it also means more premium, so the company has more flexibility with larger fleets.
When insuring drivers, insurance companies may charge a premium depending on the driver’s record. Keeping a clean record leads to the lowest insurance premiums.
Moreover, if you employ young adults, some insurance companies may not allow them to drive or charge you extra to include them in your insurance policy.
Combined Policy Discounts
Some insurance companies may provide commercial auto insurance discounts if you maintain other commercial insurance policies with them. For example, if you purchase commercial liability and property insurance from the same provider, they might give you a better deal on your fleet insurance as well.
Incidentally, some companies may also provide an auto insurance discount if you maintain other policies with them (i.e. homeowner’s insurance). Check to see if such discounts are available and applicable.
Strategic Vehicle Acquisition
When business is booming and you need to expand your fleet, you have to consider your options carefully. Some vehicles are way more costly than others, and this impacts their insurance premiums.
Is it more cost efficient to buy one expensive vehicle, or two inexpensive ones? The cost of repair a new vehicle might have in case of an accident will define the insurance premiums you will have to pay in case something goes wrong.
It is best to consider each addition to your fleet carefully. Check your budget before making this decision. A new vehicle will bring about recurring costs.
Similarly, if you are downsizing your fleet, look to remove the vehicle with the highest maintenance and insurance costs. This will help your operations become leaner.
When it comes to auto insurance, the term deductibles refers to the money your company has to pay before your insurance policy covers the rest in the event of an accident. Some policies will offer you low deductibles.
In general terms, the lowest the deductible cost, the highest your monthly premiums will be. If you want a more economical insurance policy, consider raising your deductible cost. This will slightly weaken your insurance policy in case of an accident, but it will lower costs across the board unless you have frequent accidents in your fleet.
Depending on accident frequency, raising your deductible may improve your annual premium by a respectable percentage.
Switch Providers if Premiums Go Up
Finally, don’t hesitate to shop around if commercial auto premiums go up. The insurance industry is so competitive that you will probably find a better deal if you are willing to browse the market for a while.
Insurance companies may grow complacent with long-time clients and not offer them their best rates. If that is the case, ask for a discount, or start looking for other insurance providers.
If you choose an independent agent, they will have multiple insurance companies they can use to find you the best deal. Been with one awhile? Ask them to shop you around again.
All Your Commercial Fleet Insurance Needs from a Single Point of Contact
If you are shopping for top-tier commercial fleet insurance in Scottsburg, Sellersburg, New Albany, and Jeffersonville, Indiana, or Louisville, Kentucky area we’ve got you covered. ISU Insurance and Investment Group is an independent insurance agency that has helped thousands of clients save money on their insurance premiums while ensuring they are properly covered.
Our independent ownership allows us to provide top-level personalized insurance services and deliver the best value through our national network. Thanks to our proprietary ISU One Responsible Source(TM) concept, we can cover all aspects of insurance from a single point of contact, driving costs down.
"Our clients have the security knowing they are paying the RIGHT price for the RIGHT insurance coverage. You will be confident that you made the RIGHT decisions for your insurance policies."
Richie Buchanan is owner of ISU Insurance and Investment Group. Richie is married to Susan and is the father of Jackson (5) and Evie (3). He started in insurance in 2001. Since then he has helped 1000's of clients just like you find the right price and coverage.