UPDATED: Mar 13, 2020
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Fleet auto insurance differs from regular auto insurance in a couple of ways. The state laws surrounding auto insurance for commercial vehicles are almost always different than that of regular cars, and the value of the vehicles is generally much greater for fleet auto insurance. With fleet auto insurance, there is no personal ‘owner’ of an automobile; the owner of all vehicles listed on a fleet auto insurance policy must be a company, whether it’s a sole proprietorship or a corporation. The various add-ons to auto insurance, like collision and comprehensive insurance policies, will also be different with fleet insurance.
Note that a ‘fleet’ may be a single car that your company uses to do quick deliveries to local clients, or it may be a hundred dump trucks that your company uses for hauling or construction. Regardless of how many vehicles the company owns or leases, commercial fleet auto insurance is required to adequately protect the vehicle and its drivers.
Add all of your company drivers to your fleet policy
As the saying goes, “there’s never a good time for a car accident”. When it comes to fleet auto insurance, there’s never a good time for an automobile accident, but timing is especially bad when the driver of your company vehicle isn’t listed on your fleet auto insurance policy. This is where most business owners end up running afoul of their insurance company. It’s critically important that you ensure that every one of your employees tasked with driving a company vehicle is listed on your auto insurance policy. The insurance company calculates risk partly based on who is driving the vehicles, so they need to know this information to accurately calculate how much your insurance should cost.
If you have employees driving that aren’t listed on your fleet insurance policy, your insurance company may think that you are trying to defraud them, and you can end up having to deal with all sorts of additional problems on top of the employee’s accident. Also, many company vehicles like large trucks or multiple-passenger vehicles require special licenses to operate, and your insurance company needs to know that your drivers are adequately licensed before they get behind the wheel.
This one is easy; update your fleet auto insurance every time you have a driver change at your company. If you don’t, your claims may be denied – or worse.
Fleet auto insurance only covers your vehicles and your drivers!
While your personal comprehensive auto insurance policy may cover personal items of value that are in the car at the time of an accident, fleet auto insurance generally does not. Fleet auto insurance covers vehicles and drivers, and those that they affect in the course of a crash or other accident. Company materials, tools, products, and other items that are in the vehicle will not be covered by fleet auto insurance.
If your company vehicles are loaded with expensive equipment or other valuable items during the business day, you can purchase liability insurance that will provide adequate coverage in the event of damage, theft or other loss. Speak with your insurance agent to determine exactly which policy you will need to cover everything in your company vehicles that aren’t covered by your fleet auto insurance.
How to save a few dollars on your fleet insurance
It seems almost silly to say it, but the best way to save huge amounts on your fleet auto insurance policies is to hire drivers that have a safe, clean driving record. Adding just a single driver with a poor history to your fleet auto insurance can raise premiums by more than 10%; when multiplied across your entire fleet of company vehicles, this amount can be significant. If your operation involves having multiple people in each vehicle during the work day, you can simply restrict the drivers to those in your team with the best driving records. It’s impractical, but it will definitely provide some savings.
Purchasing your fleet auto insurance from the same insurance company that holds your general liability and other business insurance policies can provide some excellent savings. Call your insurance company and ask if they offer any discounts for bundling multiple policies together. You may also be able to slip in your family’s personal insurance policies as well, providing even more cost savings.
Check and see if your fleet auto insurance provider offers discounts for having GPS devices installed in your vehicles. Not only is this a relatively inexpensive way to earn a discount, but it can also help you keep tabs on your company vehicles and will ensure that any stolen vehicles are recovered quickly. There are many inexpensive fleet GPS tracking providers available, so once you get the go-ahead from your auto insurance company, do some research and get your fleet tracking set up.
Change and update your policy as often as is necessary
With personal auto insurance, individuals generally don’t have a lot of contact with their insurance company unless they need to deal with an accident or another claim. With fleet auto insurance, it’s a lot more important to be in regular communication with your insurance company to update them on any changes to your vehicles, or to your assigned drivers. It’s best to have someone on your team assigned to contact your fleet auto insurance company as soon as there’s a change to any of these items. By keeping your insurance company in the loop, you’ll earn their trust and you’ll keep the protection afforded by your insurance at the highest level.
Purchasing sufficient auto insurance for a fleet of company vehicles may be expensive, but it’s the cost of doing business in this manner. Try not to skimp or aim for the cheapest fleet auto insurance; you’re covering your company’s employees and your own assets. By shopping around and utilizing the tips above, you will be able to purchase effective levels of coverage at a price that’s right for your business and your budget.