Insuring Your Commercial Vehicle
If you own a commercial vehicle of any sort, whether it is a car or a van, then you are legally required to ensure you have taken out commercial vehicle insurance. Commercial insurance for a vehicle is a different product to a typical home policy and offers types of cover as standard that are pertinent for a vehicle used for business purposes; cover that a standard domestic vehicle policy does not offer protection for.
To understand a little more about insuring your business vehicle, let us first clarify what the legal requirements are for using a vehicle in a commercial capacity.
In addition to your vehicle not being covered on a domestic policy, the law states that you must have a minimum level of cover for any commercial vehicle. This is third party insurance, which means that any damage or injury caused to the other person in an accident is covered, but any costs of the accident to you or your vehicle must be met from your own pocket.
Comprehensive cover is also available, which covers costs incurred by the policyholder and their vehicle, but this is more expensive.
Driving without insurance is not only illegal, but carries a fine of £5,000 and up to eight penalty points can be added to your license if found guilty. Furthermore, most police forces across the country now use cameras that run number plate recognition software. These can take a picture of your car as it is travelling, check the DVLA database and provide police instantly with the latest information, including whether the vehicle is insured, taxed, stolen or has a valid MOT certificate.
There are a couple of major differences between commercial vehicle insurance and car insurance. The most obvious of these is that a commercial vehicle is driven for business purposes and as such, particularly if it is a van, can carry a large amount of expensive equipment. Domestic car insurance does not cover specialist business equipment, only personal items, whereas a quality commercial policy should cover specialist items that are transported in the vehicle to allow the driver to complete their work.
In addition, insurance companies view commercial vehicle owners as a greater risk. The fact that commercial drivers often do not own the vehicle they drive, is viewed by insurers as meaning that they may drive more carelessly on the road, which can often result in higher premiums being asked.
What to look for in a good commercial vehicle insurance policy
There are several factors to consider in what makes up a good commercial policy:
Level of cover – It is important the level of cover offered by the policy is enough to cover the day-to-day use of the vehicle and the items it transports. Ensuring you cover the cost of replacing the vehicle and any items it usually carries is vital in obtaining the correct level of cover at the best price.
Cover for items transported – The best commercial policies should include cover for any specialist items your vehicle may carry for business purposes. It is wise to ensure that any items that are particularly expensive are named on the policy and covered and to check any clauses about limits placed on claims for an individual item.
Courtesy vehicle – Occasionally, if you are involved in an accident your vehicle may be off the road while it is repaired. Check your policy to ensure that you will be offered a courtesy vehicle while yours is repaired, meaning you can at least carry on working in some capacity.
Cost – Of course, the cost of the policy is important but it is a fine balancing act. Paying more for a policy that covers all aspects of your business may make for tighter profit margins, but it does offer greater security and peace of mind.
It is all about finding the balance between getting the best value policy and the greatest level of cover, that is the skill that allows you to find the best commercial vehicle insurance.Follow @CaerphillyObsvr