Business and commercial car fleet operators will require cover that is cost-effective, with an effective account management team to handle claims efficiently and without fuss.
Commercial fleet insurance policies are available for such risks whether the fleet is a new fleet or has been fleet rated for many years. A new fleet policy may start out at 2 vehicles with the flexibility to add more vehicles as the year progresses.
Extensions to cover may include breakdown cover which we can arrange to run alongside your fleet.
Typically, classes of use to consider may include the following:
- Social, Domestic and Pleasure use – This would allow a policyholder to commute to and from one permanent place of work. A business car policy would not be suitable in this instance and you would be advised to insure your fleet vehicles individually to obtain the best premiums. Or to contact an insurer who can place ‘family fleets’.
- Class 1 Business Use – This would allow the policyholder to use the vehicle for their business or profession and would allow travel to more than one permanent place of work. An area manager may require Class 1 use.
- Class 2 Business Use – This would allow the same use as class 1 but for other drivers named on the policy as well.
- Class 3 Business Use – This would provide the widest cover available allowing commercial travel including collection of money.
Information required to obtain a business fleet insurance quotation includes in the first instance the name and address of the proposer.
Other factors taken in to consideration by an underwriter of a fleet insurance policy include the occupation and ultimately what the vehicles are used for.
Age restrictions will also be taken in to consideration when rating a fleet policy and a typical fleet policy will exclude drivers aged below 17, or exclude drivers aged below 21, or exclude drivers aged below 25 or exclude drivers aged below 30. There are other variables to these age restrictions, but these are the most common. You will pay more for a policy that excludes drivers aged below 17 than you would for a policy that excludes drivers aged below 30.
The vehicle profile will also be an important consideration for a commercial fleet insurance underwriter. They will consider the cost of repairs (parts and labour) for a particular vehicle, the value of the vehicle, the performance of the vehicle and the level of security amongst other things.
Like other fleet insurance polices, an underwriter will consider the previous claims history when calculating your premium. The best rates will be reserved for clients that have had no claims, and an underwriter will typically consider the last 3 years of claims history to be the most important.
Also, it is important for a fleet manager to assess their overall exposure to risk and if your employees use their own vehicles for business use you would want to consider some contingency cover or occasional business use.
Contingent liability on your fleet insurance policy will protect you if your employees own policy becomes inoperative. You would have made the necessary checks to your employees’ insurance certificate to confirm they have the correct business use insured. However, since then the employee may have failed to keep up their direct debit payments for the insurance and the policy may have been cancelled without your knowledge. In this instance, the contingent liability cover will protect your company from third party liability claims, but not the employees own vehicle damage.
Alternatively, a fleet insurance policy will often have the facility to include Occasional Business Use which will provide cover for your employees’ own vehicles if they do not have business use or if they are not able to arrange this cover. This cover will not be operative if the employee is using the vehicle for their own personal use.
Our fleet insurance policies will provide cover for fleets of any size ranging from 2 to 750+ vehicles. A commercial fleet insurance policy is not suitable for vehicles that are primarily used for Social Domestic and Pleasure Use or for family fleet policies where there is no requirement for business use.
A commercial fleet policy will cover vehicles of any type including private cars, vans, HGV’s, Mini-buses, taxis, special type vehicles and fork lift trucks.
What does commercial fleet insurance cover?
Commercial fleet insurance will typical provide cover for carriage of own goods or for hire and reward, or for a mixture of both. Carriage of own goods would be suitable for a plumber or a wholesaler making deliveries. A fleet insurance policy providing cover for hire and reward would be suitable for a haulage company or a taxi firm. A haulage company will charge for delivering goods, just as a taxi company will charge for transporting paying passengers. A plumber will use his vehicle to carry his own tools and materials.
Information required to obtain a fleet insurance quotation includes in the first instance the name and address of the proposer. The registered address of a business is playing an increasingly important role in the rating process due to a change to how awards for personal injury claims are discounted. Traditionally, personal injury claims would have a discount rate applied to them of 2.5%, which reduced the amount of compensation the insurer was liable to pay. This discount rate has changed to -0.75%, which has resulted in an increase in compensation awards. This has lead to significant extra costs for insurers and they are reacting by increasing premiums in areas with higher than average incidents of personal injury claims. This discount rate is also known as the Ogden Rate.
Other factors taken in to consideration by an underwriter of a fleet insurance policy is the use of the vehicles. A fleet requiring use for hire and reward will pay significantly more than a fleet that is used for carriage of own goods.
Age restrictions will be taken in to consideration when rating a fleet policy and the following are typical age restrictions that a fleet insurer would offer. A fleet policy would usually exclude drivers aged below 17, or exclude drivers aged below 21, or exclude drivers aged below 25 or exclude drivers aged below 30. There are other variables, but these are the most common. You would pay more for a policy that excludes drivers aged below 17 than you would for a policy that excludes drivers aged below 30.
The vehicle profile will also be an important consideration for a fleet insurance underwriter. An underwriter will consider the cost of repairs (parts and labour) for a particular vehicle, the value of the vehicle, the performance of the vehicle and the level of security amongst other things.
One of the main rating criteria for fleet insurance policies is the performance of the fleet expressed by the number of claims made and the costs of the claims. This information is collated by an underwriter usually two months before the expiry of a fleet insurance policy and is represented in a document which is known as your claims experience.
An underwriter will use your claims experience to calculate your loss ratio, by dividing the total amount paid out in claims by the total amount paid in premium. For example, if you have had £5,000 in claims in a given period and you have paid £10,000 in premium, your claims loss ratio is 50%. Calculated as follows, (£5,000 / £10,000) x 100 = 50%
For every £1 you spend on fleet insurance, your insurance company pays 35p in administration costs, so the insurer will only break even if your claims loss ratio is less than 65p in the £1, or 65%. You will pay a better premium for your fleet insurance, if your insurer is paying out less than 65p in every £1 in claims. If your insurer is paying out more than this, your premium will generally increase as a result.
The type of cover you select will also determine your premium and there are 3 main levels of cover ranging from Third Party Only to Third Party Fire and Theft and finally to Comprehensive cover. You would expect to pay more for Comprehensive cover than you would for Third Party Only cover. There are other levels of cover available but these are the 3 most common cover types.
Finally, the number of vehicles insured on the policy will also be one of the main driving forces behind the premium.
A fleet insurance policy will cover a group of vehicles under a single policy that are either owned, leased, hired or borrowed by a business that is a sole trader, partnership or a limited company. Primarily, the vehicles will be used for business and the cover will usually extend to include Social Domestic and Pleasure Use.
A fleet policy will cover any authorised and licenced driver and typically an insurer will exclude drivers depending on their age. The most flexible policy will exclude drivers aged below 17, but the most competitive premiums are available for excluding drivers aged below 21, below 25 or for excluding drivers aged below 30. Drivers that fall outside of this age restriction would be named on the policy, subject to approval from the underwriter.
A full driver profile should be considered at the quotation stage as we can negotiate discounts with some insurers depending on the age of your drivers. A discount would be available for a policyholder if the majority of their drivers were aged over 30 even if the driving restriction required was to exclude drivers aged below 21 years of age.
For this reason, we place a great emphasis on initial data collection. A considered and thoughtful approach to marketing your fleet will result in lower premiums for you.
We would consider a fleet quote to consist of as little as 2 vehicles increasing to over 750 vehicles. Our larger clients operate more than 750 vehicles, and whether you have 2 vehicles insured with us or over 750 you are guaranteed the same considered approach to your insurance needs and the same excellent customer service.
All occupations can be considered and we can provide cover for a plumber that has 2 vans, to a national haulage operator or a taxi operator or a large distribution company. We use a panel of over 25 insurers to ensure that we can accommodate all risks. We also use Lloyds of London to place some of our more unusual risks. Generally speaking, if it has wheels, we can cover it. We have chosen our insurance panel carefully to reflect our client’s needs. No two risks are the same and our panel of insurers include specialist, motor only, insurers, as well as all the household names you will be familiar with.
Our team of in-house insurance brokers and negotiators have been carefully brought together over many years and are a long-standing unit, which will give you the peace of mind that your insurance is being handled by experts. Our team consists of ex-fleet insurance underwriters and our staff are all qualified to at least CII standard. We are a Chartered Insurance Broker and are fully committed to the continuous development of our staff, and to providing you with the best levels of customer service.
Savings are available to clients who proactively work with us across all sizes of fleets and we have saved clients over half their insurance premium in some cases.
We are frequently approached by clients who are suspicious that their current insurance broker has not conducted a full marketing exercise at renewal: despite being advised that they have. Suspicions may arise because the insurance premium has increased year on year despite there being no deterioration in the claims experience. Or the same insurance company has been put forward for the 3rd year in a row. We can confirm these suspicions are correct by conducting a quick ring around insurers. These types of fleets are usually the cases where the biggest savings are available. However, we find that we can also offer big savings to clients whose fleet has already been heavily marketed.
Why choose Fleetcover for commercial fleet insurance?
We offer the following services as standard, as part of our commitment to you:
- Savings on your fleet insurance renewal
- Comprehensive fleet review
- Strategic marketing to our panel of insurers
- In-house claims department
- Access to risk management
- Excellent customer service from our knowledgeable team of experts
- Timely, personal and private advice on your fleet insurance issues