7 Tips for Getting the Best Insurance Rates on Work Vehicles

reduce the cost of your car insurance

Buying a car for your business is a different ballgame than buying a personal vehicle. The avenues you take to purchase a work vehicle can affect your tax breaks and even your insurance.

If you’re leasing or financing a work vehicle, there may be additional insurance requirements beyond the minimum coverage set by your state. Having ample coverage is incredibly important because it protects your business assets. This includes your invaluable employees that are driving the work vehicles.

It’s also important for business owners to understand their personal car insurance may not cover work-related use. Even self-employed individuals could find themselves in a bind if their work vehicle isn’t covered by commercial car insurance.

No matter how you obtain the work, vehicle insurance is an absolute must that will add to your operating costs. Here are a few ways to lower the cost of commercial car insurance.

Research Rates

Searching for car insurance online will give you a better idea of the standard rates as well as what options are available in your area. After shopping around you can use the rates you’ve found to negotiate with insurance providers and get the best premium price possible.

*NOTE: While researching rates, it’s also a good idea to look at the complaint records for various insurance companies. This will give you an idea of how easy the company is to work with if you ever need to actually use the insurance. Checking the company’s A.M. Best Rating provides insight on their financial stability and ability to pay claims.

Insure All Your Vehicles With One Provider

Insurance companies reward customers that bundle policies together by lowering the overall price. Selecting one insurance provider for all of your work vehicles or using the same provider that insures your personal vehicles, could get you a 15% discounted rate on each car. It also makes monthly insurance payments much more manageable.

Keep a Clean Driving Record

You and the employees who will be driving the work vehicles need to have impeccable driving records if you want to get the best rates. Providers are analyzing risk every time someone applies for an insurance policy. One way they gauge risk is by looking into a driver’s history. The worse your driving record is the riskier it appears for insurers. Usually, discounts of about 5% will be given for drivers that have had a clean record for the last three years.

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If someone else will be driving the work vehicles include a driving record check during the background search of new employees. You may also want to avoid letting teenagers get behind the wheel of work vehicles. Because they are so new to driving, insurance companies typically increase the rates for teenage drivers. On the flip side, senior citizens are usually given discounts since they are less likely to get in an accident.

Invest in Safe, Reliable Work Vehicles

Like car insurance for a personal vehicle, the make and models of the automobiles can make a difference in the rate you receive. Cars that are less likely to need repairs, can be repaired for less and include safety features that protect passengers reduce the risk for insurers. Reduced risk translates into lower rates.

You can check the loss data and ratings of vehicles at the Insurance Institute for Highway Safety’s Highway Data Loss Institute.

Keep Documentation of Everything You Pay

One effective way to make commercial car insurance cheaper is to deduct the costs during tax season. Car insurance is one of many premium deductions that can dramatically reduce the amount you have to pay in taxes. It’s an indirect way to get car insurance for less. However, you need to keep a record of all the expenses paid during a tax year in case you get audited.

Keep the Mileage as Low as Possible

The more you and your employees drive the more risk there will be for the insurance company.  That’s  because there are more opportunities for an accident. Take steps to minimize the miles driven in a work vehicle.  You’ll have a better chance of getting a low premium.


Pay an Annual Premium

Making monthly or quarterly insurance premium payments are usually the most feasible option for small businesses. However, if you can afford to pay the premiums in one annual lump sum you should save money. Many insurance providers tack on extra fees when you choose to do monthly or quarterly installments.

Conclusion: There are a number of things business owners can do to decrease the cost of commercial car insurance. Taking the time to research rates and find safe vehicles will definitely pay off in the long run.


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