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Commercial Fleet Insurance: What is it? And Should I Get It?

Fleet insurance, commonly known as commercial fleet insurance, is designed to provide coverage for vehicles and drivers of a company. It is different from regular auto insurance in that the owner listed in the insurance policy must be a company, not a personal owner.

Why Should a Company Get it?

The most significant benefit of fleet insurance is that many different vehicles are covered under one policy. This eliminates much of the worry and stress of handling a separate insurance policy for each distinct vehicle.

One of the other significant advantages of fleet insurance is that when a claim is made, the process is much sleeker and practical than when managed through another type, such as insurance bonds.

Vehicle Coverage

The type of vehicles that can be covered by commercial fleet insurance includes food trucks, utility trucks, work vans, box trucks as well as large commercial vehicles. This can also include personal vehicles used for business purposes such as company cars. The coverage will be for the equipment inside the commercial vehicle as well as the employees operating them and more.

Types Of Coverage

There are common coverages provided by commercial fleet insurance.

  • Collision Coverage – This will pay when a commercial vehicle is hit or hits an object.
  • Bodily Injury Liability – This will pay for the bodily injury or death caused by an accident for which a policyholder’s vehicle is at fault. Most of these policies include legal defense costs.
  • Comprehensive Physical Damage – This pays for damage to commercial vehicles from fire, theft, vandalism, flood, and specified covered perils.
  • Property Damage Liability – This provides policyholders with protection if their commercial vehicles accidentally cause damage to another individual’s property. Most of these policies include legal defense costs.
  • Uninsured Motorist Coverage – This will pay for a policyholder’s injuries as well as certain types of property damage resulting from a hit-and-run driver or uninsured drivers. It is also possible to get underinsured motorist coverage as part of this coverage.
  • Medical Payments, Personal Injury, No-Fault – This coverage will pay for the medical expenses of a driver or passengers in a vehicle. It will be a covered accident without regard to who is at fault.
  • Combined Single Limit (CSL) – This coverage provides separate limits for property damage as well as bodily injury claims. A combined single limit policy can give the same dollar amount of coverage for covered incidents. This is the case, whether it is property damage or bodily injury, as well as involving one person or several.

It’s Important To Keep the Policy Updated

A company needs to make sure all of their employees who are driving its vehicles are listed on their commercial fleet insurance policy. Driving many of these vehicles also requires special licenses to operate them. An insurance company must be made aware that all the drivers for business are properly licensed. Things can change quickly in business, but it is essential to make certain the information in a commercial fleet insurance policy is always current, otherwise, the policy could be voided.

Save Money by Hiring Drivers with Clean Records

The best way a company can save money with their commercial fleet insurance policy is to only hire drivers with a clean and safe driving record. Hiring just one driver with a poor driving record can increase the premium of a policy by more than 10 percent.

Final Takeaway

When a business needs commercial fleet insurance, they should discuss it with an insurance expert. It can be complicated. Getting the best insurance policy for a company’s individual situation requires the knowledge of a professional. It is an important investment for any business needing to provide insurance coverage for their drivers and vehicles.

Updated on April 22, 2020

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