Business Vehicle Insurance: a quick quide
Choosing the right insurance for your vehicle is crucial if you rely on it for business. This quick guide shows you how.
If you're running a business that depends on motor vehicles, then choosing the right cover can mean the difference between business as usual and going under if something goes wrong.
The most important things to think about when choosing insurance are
- how it would affect your business if you couldn't use the vehicle because it was stolen or damaged in an accident
- how expensive it would be to repair any damage to the vehicle
- what your vehicle will be carrying and whether you need specialist insurance to cover this
The answers to these questions are likely to dictate the type of policy you need, as well as the level of cover - from third party only to fully comprehensive. Read Van insurance: getting a good deal for more information on levels of cover.
Some, but not all, fully comprehensive commercial vehicle policies will pay for you to hire a replacement vehicle if yours is off the road for repairs after an accident. If this is important to you, then make sure you're clear about whether it's included as standard or for an additional fee.
Depending on the type of business you run, you might also need specialist cover for:
- Transporting people. If your business vehicle carries passengers - for example, if you run a taxi, limousine or minibus service - you need to make sure that your insurance covers your passengers too.
- Goods in transit and tools. Although some policies do cover theft from your vehicle as standard, you'll often need to take out separate insurance for this - especially if you're transporting high-value goods or things that belong to someone else. Make sure you know exactly where you stand.
- Hazardous materials. Some policies are not valid if you are carrying hazardous or toxic materials
- Cooking or heating food and drink. Not all policies will pay out for fire damage caused by cooking equipment in the van.
Reducing your premium
Commercial vehicle insurance can be expensive: vehicles used for business tend to be worked harder than private cars, and accidents can be more damaging and expensive to repair. But it's still possible to cut your premium.
- Security- if you park your vehicle on the street overnight, expect to pay significantly more than if it is locked in a secure yard, garage or car park. Your premiums could also be lower if the vehicle is fitted with an alarm, deadlocks, or a tracker device.
- Voluntary excess- You can reduce your premiums significantly by choosing to pay a larger excess: but make sure your business can genuinely afford to pay it if you have to.
Key points
- Get the right cover- make sure your policy exactly covers the way you will use your vehicle. Other types of policy might be cheaper but it's a false economy if you have a claim refused.
- Be secure- the safer your vehicle is, the lower your premiums will be. Investing in an alarm or secure parking could save you money.
- Consider specialist insurers- smaller specialist insurers often have policies tailored to particular types of business.
Find out more