Small and Medium-Sized Enterprises (SMEs) often rely on vehicles for various reasons, such as for delivery, riding services, and getting stocks. However, getting commercial business insurance can be a huge addition to your expenses, so it’s best if you can find ways to get discounts and lower your premiums.
In this article, we’ll explore some tips on how to achieve lower SME business insurance, specifically on commercial cars.
What is Commercial Auto Insurance?
Commercial auto insurance is a type of business insurance that covers liabilities on vehicle repairs, property damages, legal aspects, and medical expenses of the affected individuals.
New business owners think that personal auto insurance is enough to cover vehicle-related damages, but it isn’t. Once you plan to use a vehicle for business purposes, you also need to avail yourself of commercial business insurance.
Contrary to common belief, getting commercial insurance can significantly help business owners save money in case of unexpected incidents. However, availing of commercial auto insurance can be a bit pricey, so you should be aware of the ways to lower the premium price.
1. Bundle Your Policies
One of the most popular ways to lower your SME business insurance premium is by bundling your policies. When you have already found the ideal insurance provider, it’s best to get all the types of insurance you need, and avail them in a bundle. Many insurance providers give high discounts to bundled policies, especially for businesses.
Meanwhile, if you’re business uses a lot of vehicles, like for taxi service purposes, you can also bundle the policies as a fleet.
2. Maintain a Clean Driving Record
How’s your driving? If you have few to no records of driving violations, there’s a higher chance that the insurance provider will give you a discount. Of course, it’s not just about the owner but also everyone who will be driving the commercial vehicle. So, if you’re still in the hiring process, it’s best to hire those with a clean record, who can also guarantee that they’ll maintain having no records of violations.
3. Install Smart and Safety Features
Nowadays, there are various tools that you can use to increase the safety of your commercial vehicles. Some of these features include dashcams, GPS, anti-theft devices, and telematics systems. In addition, some insurance providers offer discounts to companies that are investing in these safety features.
4. Opt for Higher Deductibles
If you want to lower your monthly premiums, you can opt for higher deductibles. This means you have to pay a higher amount out of pocket in case of emergencies, and you can also cover minor repairs instead of filing for claims.
5. Limit Employee Access to Vehicles
If you’re operating a taxi fleet, ensure that a specific driver is assigned to a taxi, and no one should be able to have access to it to ensure accountability. Meanwhile, if a vehicle can be accessed by many employees, there should be limitations based on the purpose of use. Additionally, conduct thorough research on the employees that you’ll allow to use the vehicle, and create policies on vehicle use.
6. Lump-Sum Payment Instead of Monthly
Many insurance providers often give discounts to those who opt to pay annually (or lump sum) instead of monthly. Of course, for some policyholders, the need to pay annual fees can be a challenge, but it can also help you in the long run.
So before availing of commercial car insurance, you should have enough money to pay for the annual premium, or at least allot a part of your credit limit to take care of it.
7. Ask About Industry-Specific Discounts
Some insurance providers give discounts to specific industries where they have a lot of customers. For instance, if many taxi fleet companies are availing commercial car insurance from the same insurance provider, they can provide discounts to other taxi fleet companies that are applying for insurance.
So, if you’re looking for an insurance provider, consider looking for a company that’s a go-to provider of companies in the same industry as yours.
8. Shop Around and Compare Quotes
Instead of applying for the first commercial car insurance provider that you encounter, look for as many options as possible. Having enough options allows you to compare quotations and terms that fit your business needs.
Additionally, don’t go for the cheapest option. It doesn’t always cater to the client’s specific needs, and you might end up paying more for the things you don’t need.
9. Improve Credit and Business Reputation
As your business moves forward, keep in mind to improve the credit and maintain a great business reputation. If you can do so, there’s a higher chance that you can score a better deal when availing of commercial car insurance.
10. Review and Update Your Policy Regularly
Change is common and essential in any business. As your business grows, it’s best to review and update your insurance policy. This allows you to spend your money on the coverage you don’t need while availing of those that you need.
Final Thoughts
SME business insurance is essential to protect your business against risks. However, it can be expensive. By considering the tips listed in this article, you can avail yourself of discounts from your chosen provider.
Are you looking for the right commercial car insurance? Share your thoughts and experiences by commenting below!