Fleet Insurance - What is the Difference?

Fleet insurance is formulated to provide mandatory road risk coverage to a wide array of vehicles ranging from cars, buses, taxis to coaches, lorries, transit vans and agricultural vehicles. A fleet insurance policy enables an individual or a company to insure a number of vehicles of any categories under one single policy.

A fleet insurance policy generally only provides road risk insurance. This policy can be of two types, namely, Third Party Fire And Theft and Comprehensive Coverage. Breakdown insurance is generally the only optional extra available in case of a fleet insurance policy.

Car Fleet Insurance

The premium of a car fleet insurance policy will depend on

a) The number of cars being insured
b) The types of the cars
c) The accident records of the cars.

Insurance companies vary in their definition of a "fleet of cars", i.e. some companies will issue a fleet insurance policy only if there are two or more cars while others may require five or more cars to be able to issue a fleet insurance policy. Thus they vary on the minimum number of cars that can be termed as a "fleet". But, presently, most insurance providers classify a group of five or more cars as a car fleet.

Insurance companies generally offer complimentary and additional products when a car fleet insurance is taken. These products can be free of cost or can have some minor expenses attached.

Though, a car fleet insurance can be taken by an individual who owns a number of cars, generally it is taken by companies who own and use a host of cars for business purposes.

Why should one go for a car fleet insurance?

A car fleet insurance comes with a huge volume of discount if the accident record of each of the vehicles in the fleet is appreciable. This discount is quite big compared to what is possible in case of standard individual car insurance. People going for car fleet insurance can save as much as sixty-seven percent on their insurance expenditure.

Disadvantage of car fleet insurance

The greatest disadvantage of car fleet insurance is that in case of an accident of one of the vehicles, the premium of all the vehicles covered under the policy gets affected.

How to overcome this disadvantage

Often some vehicles are found to be highly susceptible to accidents. If one car in the fleet is found to be an accident-prone one, it is better to insure it under an individual car insurance policy and insure the remaining the cars under a car fleet insurance policy. This ensures that any future claim for the accident-prone vehicle does not increase the premium of the fleet policy.

The present-day insurance providers who specialise in fleet insurance perceive that dealing with fleet insurance is not only about quoting premiums. They also try to provide assistance with a host of fleet insurance services that actually lower the expenses and risks attached with the maintenance of a fleet of vehicles.

One, who is planning to go for a fleet insurance policy for his vehicles, needs to do a thorough research of the natures of coverage available, additional services offered, and premiums quoted, by different insurers, before finally signing up.