Managing a fleet means ensuring everyone’s safety on the road. It also entails protecting your company from financial burdens that may arise in the case of an accident. One way to protect your company from potential headaches is to get fleet insurance.

Is fleet insurance essential for commercial vehicle operators? The short answer is YES.

At the onset, fleet coverage may seem like yet another expense. However, the law mandates all motor carriers to provide a safe environment for drivers. This includes providing the proper insurance coverage for all vehicles within the fleet.

Think of it this way: If you insure your car to protect yourself from liabilities, you should do the same for a larger network of vehicles. This way, you prevent having to disburse from your pocket since the insurance company will take care of the expenses on your behalf.

Before signing up for fleet insurance, you need to know the different types of coverages for fleet companies. In this article, we’ll talk about commercial vehicle insurance works and how to choose the best fleet insurance for your company.

What is Fleet Vehicle Insurance?

Fleet vehicle insurance works very much like a personal car insurance coverage where you pay a premium to an insurance company. Most trucking accidents are often serious. Without insurance, motor carriers usually shoulder a substantial cost. According to the National Safety Council (NSC), large trucks accounted for 10% of fatal crashes. With commercial fleet insurance, the costs for claims are less substantial as the insurer assumes most of the expenses.

How does fleet insurance work? Commercial fleet insurance allows you to insure the whole fleet or selected individual vehicles. The insurance company will conduct risk assessments on the entire fleet and suggest premiums based on the risks associated as a whole. You have two options:

  1. The ‘Any Driver’ policy allows anyone to operate the vehicle. This type of insurance offers the best flexibility and is ideal for large companies that often assign different drivers to a vehicle.
  2. The ‘Named Driver’ policy requires you to assign a name to each vehicle that you will insure. This is an affordable option for small companies that have only a few drivers and vehicles in the fleet.

But what if you have young or convicted drivers in the company? If you choose the ‘Any Driver’ policy, your premium will increase substantially as the driver’s risk will be distributed across the whole fleet. In this case, you can insure most drivers with the ‘Any Driver’ policy and obtain the ‘Named Driver’ policy for the high-risk ones. This combination can help reduce your premium but still have full coverage for your fleet.

What Does Fleet Insurance Cover?

Like car insurance, fleet insurance covers damage to property and bodily harm. If an accident resulted in damage to the vehicle, the insurance plan can cover the costs for repairs and even replacement if the damaged vehicle is beyond repair.

If the accident resulted in physical injury, the fleet insurance may cover the legal and medical costs of the driver or a third party.

Some companies cover both property damage and injuries. In addition to accidents, most insurers offer additional coverage for roadside assistance, collision repair costs, uninsured driver coverage, and more. These are minor inclusions but are helpful on the road.

Note that coverage varies from one company to the next, so it’s best to know the limitations or exclusions before signing up for a plan.

Fleet Vehicle Insurance Rates

One of the common considerations in obtaining fleet size is the number of vehicles within the fleet. How many vehicles do you need to get fleet insurance? If you have three or more commercial vehicles, you can get fleet insurance for your company.

The cost of fleet insurance depends on the carrier, business size, and the number of vehicles. Some insurance companies provide discounts for large fleet insurance. Other factors may affect the cost of your policy.

  • Age of vehicles – If you have new vehicles in your fleet, you may have to pay slightly higher fees. Used vehicles are less expensive to repair, so your company could save more money if you have older vehicles in your fleet.
  • Purpose – Transport and delivery fleets tend to have higher premiums than food delivery fleets.
  • Insurance options – A comprehensive policy may cost more, but it also protects the company from huge losses. You can get a plan with basic features, but you might end up paying more out-of-pocket costs if your vehicle ends up in an accident.

Fleet insurance for trucks also depends on their Gross Vehicle Weight Rating (GVWR). Trucks with more than 26,001 lbs. GVWR (e.g., 18 wheelers) usually have the most expensive fleet insurance rate.

Fleet Management and Insurance

When accidents happen on the road, every little detail counts. In addition to ensuring driving safety, fleet management systems keep daily logs of everything that happens on the road. Whether it’s sudden acceleration or tailgating that led to a collision, telematics software provides reliable data that can be used for filing for damages or reducing costs due to accidents and legal claims.

Additionally, many insurance providers offer lower premiums for companies with fleet management systems. With this type of security in place, vehicles are less likely to be stolen or lost. And if they are, recovery is much faster thanks to GPS tracking.

Final Thoughts

Whether you have a fleet of cars or trucks, fleet insurance is necessary for keeping your network of vehicles safe. They are integral to daily operations and must be treated with utmost care as you would with your automobile. A fleet insurance plan also gives drivers peace of mind on the road.

Choose the right fleet insurance investment for your company by checking what’s included in the plan. Not all insurers offer the same benefits; look for one that offers a bit of flexibility if you have a small fleet. Regardless of what type of insurance you get, it will be an investment that’s worth your time and money.

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