With the cost of fleet management continuing to rise, plenty of businesses across the UK are looking for ways to lower their fleet insurance premiums at renewal.
Looking for tips to reduce the price of your insurance? Keep reading to find out what affects the price of your fleet insurance and the practical steps you can take to reduce how much you pay.
How are fleet insurance premiums calculated?
The cost of fleet insurance can vary significantly from business to business, as it depends on a number of different factors.
Each insurer has their own method for calculating risk, which is why quotes can vary from one insurance company to the next, but most look at similar key elements.
1. The size of your fleet
More vehicles on the road can indicate a higher risk to insurers, which can drive up the cost of your premium.
2. The type of vehicles you operate
The price of fleet insurance is affected by the type of vehicles you operate and their value.
For example, larger vehicles such as HGVs typically carry a higher risk than standard cars because they will cost more to repair or replace. Vehicles that require specialised parts and repair services, such as EVs, could also cost more to insure.
3. Business type
The nature of your business, the mileage your drivers cover, and where you work are all considered when calculating the cost of insurance.
For example, a large courier fleet with a high mileage that operates in a busy city centre may carry more risk than a smaller fleet operating in a rural area.
4. Your drivers
Insurers will closely examine the age and experience of your drivers and take their driving history into account. Younger drivers or those with a history of claims or penalty points could increase your premium.
5. Claims history
Your fleet’s claims history plays a significant role in determining the cost of your insurance. A fleet with multiple claims will usually pay higher premiums than a similar fleet with zero claims.
6. How you manage risk
Risk management is another huge factor that affects the cost of fleet insurance premiums.
Insurers will assess how you manage the risks associated with running your business, which includes:
- How you secure your vehicles.
- The safety procedures that you implement.
- The training that you provide for employees.
How to lower fleet insurance premiums
Every insurer calculates premiums differently, so there’s no one-size-fits-all solution to reducing the cost of fleet insurance.
The following tips may not apply to every fleet, but they are worth considering to help you work towards lower premiums.
1. Keep your vehicles secure
Improving the security of your fleet with secure parking, CCTV, and alarms will help lower your risk profile.
2. Hire responsible drivers
Hiring experienced drivers with a clean record could help with reducing the risk of your fleet.
3. Manage risk effectively
Providing well-documented risk management will signal to your insurer that you handle risk responsibly.
An effective risk management strategy could involve:
- Training your staff to encourage safer driving
- Having a clear incident reporting process
- Regularly reviewing your policies and procedures.
4. Keep up to date with vehicle maintenance
Documented routine vehicle maintenance will help reduce fleet downtime and could also prove to insurers that you proactively take steps to manage risk.
5. Use a specialist fleet insurance broker
Using a specialist broker such as Patons Insurance can help you find a policy that matches your specific requirements, so that you only pay for what you need.
A broker will also compare quotes for you from multiple insurance providers to get you suitable cover at a competitive rate.
6. Opt for a higher voluntary excess if you can afford it
Voluntary excess is an additional, optional amount that you agree to pay towards an insurance claim.
Choosing a higher excess will help reduce premiums, but it’s important to make sure that you can comfortably afford to pay the amount you agree to in the event of an accident.
Bottom line
Rising operating costs are affecting businesses nationwide, so it’s understandable that fleet managers are looking for ways to cut costs where possible.
By understanding the factors involved in calculating fleet insurance, you can take practical steps to work towards lowering your premium.
Looking for a fleet insurance quote?
Our dedicated team of fleet specialists can help you find coverage that matches your specific needs. We’ll compare quotes for you from our panel of trusted insurers to find you the right policy, at the right price.
Get started with your quote today by calling 0333 015 6886 or filling out our quote form.
