With careful management and attention to detail, fleet insurance can reduce costs and enhance the safety of employees and still benefit the fleet operator with as much coverage as is required. It can also make a significant contribution towards road safety.

That’s the view of Murray Price, managing director of Eqstra Fleet Management, who says that fleet insurance covers a group of cars, commercial vehicles and trucks under one policy that’s designed to distribute risk across the board.

In Price’s words, a fleet operator pays only once for each peril, rather than insuring each vehicle individually, with the premium evaluated on challenges faced by the entire fleet.

“Fleet operators have unique needs,” says Price. “Insurance costs must take into account the complexities associated with business vehicles, such as insuring for multiple drivers and making sure vehicles can be used for as many applications as necessary.”

In price’s view, it is important for fleet operators to consult with the right insurer to ensure the business gets the optimum level of vehicle cover. “The insurer must understand the operational demands of the fleet, particularly if it is operating a number of heavy-duty trucks and commercial vehicles.”

According to Price there are some basic factors that every insurance company will take into consideration when calculating fleet insurance costs. These include:

  • The number of vehicles to be insured and what vehicle types;
  • The age and condition of vehicles;
  • Estimated mileage;
  • Claims history;
  • Vehicle telematics solutions;
  • Driver behaviour history;
  • Book value of each vehicle covered;
  • Routes, for example urban versus rural.

To qualify for fleet insurance, vehicles must be owned by the same business or person. The insurer usually requires a minimum number of vehicles in order for the insured to qualify for fleet insurance. It remains the duty of the fleet owner to keep the insurance company informed of any changes to the fleet.

Price says the benefits of fleet insurance include:

  • All vehicles owned by the business are covered, with each outlined in the policy. This greatly simplifies claims administration.
  • Drivers who battle to get individual insurance will be covered under a fleet insurance policy, which will help them to obtain individual insurance at a later time if they so wish.
  • Though companies which provide fleet insurance must still take into account the driver’s past history and experience, fleet insurance costs are much less than those of individual insurance.

Price says that since fleet insurance premiums are based specifically on the risk profile of the business, it is essential to investigate the following when choosing a fleet insurance company:

  • The ability of the insurer to administer the claims processes effectively and quickly;
  • Availability of emergency roadside assistance 24 hours a day, seven days a week;
  • Cover for reasonable storage costs or towing to the nearest repairer;
  • Approved repairers with which the insurer deals;
  • Cover for costs incurred for the removal of wreckage as well as costs for   replacing locks, keys, remote controls or the reprogramming of vehicle security systems;
  • Cover if needed outside the borders of South Africa;
  • Cover not only for the vehicles but also for accessories and spare parts;
  • Legal liability insurance cover for damage to property of other parties as a result of a vehicle accident.

“As fleet managers and logistic companies seek for affordable commercial vehicle fleet insurance, road safety is the ultimate beneficiary,” says Price. “Affordable fleet insurance depends on safer driving behaviour and the ability to accurately measure such driving.

“Fleet insurance rewards safer driving which in turn assists in reducing accidents and improving road safety.”