What Does Fleet Insurance Cover?
Imagine this scenario: on a cross-country freight run, one of the semis in your fleet accidentally rear-ends a vehicle. While everyone is OK, the rear-ended vehicle sustains minor bumper damage and the front of your semi has a few scuff marks.
Fortunately, you have comprehensive fleet insurance—an insurance policy that will cover the damages accrued to your semi and the third-party vehicle. However, fleet insurance can provide other coverages, too.
Read on for an overview of commercial fleet insurance coverages to prepare yourself and your drivers for the open road.
How does fleet insurance work? A fleet insurance auto policy shares some similarities with regular car insurance. Many insurance companies offer fleet coverage packages that are standard for most vehicles. These coverages include:
- Third-party plus fire and theft
Let’s take a closer look at each coverage type.
As its name indicates, comprehensive coverage protects all parties in an accident. As a result, this fleet policy is ideal for accidents in which the auto insurance company deems vehicles total losses. It also protects against the theft of your vehicles.
Let’s suppose a courier van in your fleet accidentally collides with a small car. Unfortunately, both vehicles are totaled. With comprehensive coverage, your policy covers your van and the small car. Additionally, comprehensive coverage protects all drivers and passengers, as well.
Although comprehensive coverage can be the most expensive coverage type, it may be well worth it. What’s more, you can help minimize comprehensive coverage expenses by signing up for a fuel card that allows you to unlock insurance benefits.
Third-party insurance is generally cheaper than comprehensive coverage. That’s because this coverage type only covers third-party vehicles and drivers. Any damage to your vehicle, driver, and passengers won’t be covered.
For example, imagine one of the semis in your fleet accidentally hits another semi. Thankfully, everyone’s OK. Your semi, however, needs extensive repairs.
If you have third-party insurance, only the third-party semi will be covered. You might be on the hook for thousands of dollars in repairs to your vehicle.
Third-Party Plus Fire and Theft
In some ways, third-party plus fire and theft coverage occupies the middle seat between comprehensive and third-party coverage. That’s because third-party plus fire and theft covers third-party damages and damages to your vehicle resulting from fire and theft.
For example, suppose a semi in your fleet has an engine that catches fire. With third-party plus fire and theft, your vehicle is covered from fire damages—even if other accident types aren’t covered.
Just as some semis have cabs with high-tech accessories, some commercial fleet insurance packages have additional add-ons and coverage options.
What does fleet insurance cover? These additional coverages include:
- Employer liability
Let’s take a deeper dive into each.
If your fleet primarily hauls goods from place to place, you’ll probably want goods-in-transit coverage. That’s because goods-in-transit insurance can protect against the loss of goods as a result of theft and accidents.
Given the fact that some goods can cost thousands (sometimes millions) of dollars, this type of car insurance protects you from serious expenses should a mishap occur.
For instance, suppose a semi in your fleet is hauling a cargo load worth $75,000. However, the semi’s trailer overturns and $30,000 worth of goods are damaged. With goods-in-transit insurance, you’re protected from this $30,000 loss.
In a perfect world, your vehicles would always be fine-tuned machines, capable of getting the job done in any circumstance. However, even the most well-maintained vehicles can experience a breakdown.
Fortunately, breakdown insurance protects against expenses caused by breakdowns. These expenses can include:
- Engine malfunctions
- Tire blowouts
- Faulty transmissions
- Windshield damage
- Towing and garage fees
- Lost keys
Some breakdown insurance even protects against lodging expenses caused by a breakdown. For example, if you live in Tucson but break down in Tulsa, breakdown insurance can pay for your lodging while a mechanic repairs your vehicle.
If your professional driving business consists of just you, the owner-operator, you don't need employer liability insurance. But if you oversee many employees, employer liability may come in handy.
In short, employer liability protects you from lawsuits initiated by employees whose expenses aren’t covered by worker’s compensation. These lawsuits typically arise when an employee is injured on the job.
For example, suppose one of your vehicles experiences a brake malfunction and your driver is injured. Employer liability insurance can potentially protect you against the employee’s injury claims.
Cover Your Fleet with AtoB
How much is truck insurance? While it can be hard to define the true cost of fleet insurance, what matters is you do what's right for your fleet company. Find a fleet insurance policy that you can afford and protect your fleet from potential accidents by purchasing the appropriate commercial auto insurance.
Fleet insurance can be expensive. Thankfully, AtoB can help you streamline your operations to make paying for the needed service a bit easier.
Alongside purchasing fuel at the pump, our fuel card allows you to spend on insurance-related expenses too. All you need to do is unlock your card’s full benefits, and you can cover insurance, maintenance, lodging, and more.
The future looks bright for your fleet. Let AtoB help make it even brighter.
Canadian Metalworking. Understanding Goods in Transit Insurance. https://www.canadianmetalworking.com/canadianmetalworking/article/management/understanding-goods-in-transit-insurance
Fleet Cover. Fleet Breakdown Cover Explained.
Investopedia. Employers' Liability Insurance.