Auto Insurance for Construction Fleets

December 2018
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Construction companies are on the go and need insurance that goes with them.

Your company vehicles keep you – and business – moving. Be sure that they and the drivers who operate them are covered.

From your work truck to your dump truck, fleet auto insurance covers all your construction company’s vehicles and drivers under one policy.

What is an Auto Fleet Policy?

Auto fleet insurance places all of the vehicles and drivers a business depends on under one policy, covering self-propelled autos such as trucks or tractors.

From small businesses with as few as three vehicles (which is often the minimum number of cars an insurance company requires to qualify for fleet coverage) to large corporations that own a hundred delivery trucks, auto fleet insurance covers all vehicles and drivers that are listed on the policy. Bonus!his bundling typically reduces the cost of coverage.

Who Can Get an Auto Fleet Policy?

In order to qualify for auto fleet insurance, all vehicles listed on the policy must be owned by the company, not by an individual.

To assure coverage in case of an accident, it is essential that all drivers are listed on the policy. If an accident should occur while a non-listed employee is driving, not only are damages for the accident typically not covered, it’s also possible that your insurance company will feel that you are trying to defraud them.

Be sure to stay in close contact with your provider and keep them abreast of any changes to the vehicles and drivers listed in your policy. Staying current will help assure that you’re covered in the event of an accident.

What Does It Cover?

Providing liability coverage for all of your company’s vehicles, these policies often provide provisions that allow employees of your company to drive any of the vehicles listed in your fleet and assures that they will be covered if they’re involved in an accident.

Usually, fleet insurance will provide the minimum collision and liability insurance necessary to meet your state’s requirements for commercial vehicles.

However, there are always additional, optional coverages you can add in order to make your coverage more comprehensive. From increasing your liability limits to opting for roadside assistance or protection against theft and damage, additional coverages can round out your fleet coverage and protect your business from losses should the unexpected occur.

What Types of Vehicles are Covered?

A fleet auto policy covers work trucks you use to drive from one job site to another as well as other work vehicles you provide for employees to do the same. All the company-owned vehicles you depend on to get the job done are covered by your auto fleet insurance policy.

Again, be sure that changes in your fleet are reflected in your policy to keep it current and to keep you protected.

What Kind of Coverage Does Your Fleet Need?

Be sure you are getting the most comprehensive auto fleet coverage available by looking for a code 1 symbol on your policy.

Indicating the broadest coverage for your commercial vehicle, symbol 1 is “any auto” coverage. Meaning any auto that your business owns or uses for business is covered by liability insurance.

Let’s say your construction company is the registered owner of a heavy-duty work truck you use for towing your trailer and 5 light-weight pickup trucks that employees use to move from one job to another. Your auto fleet policy shows a symbol 1 (any auto) for liability coverage.

One day, you accidentally run through a stop sign in your work truck while you’re on a hardware store run, resulting in a minor collision with a car that was crossing through the intersection at the same time.

The other driver suffers an injury and blames you, bringing a lawsuit against your construction business for bodily injury.

Are you covered?

The code 1 symbol signals that you have coverage for any auto, including:

  • Autos you own.
  • Autos you rent, lease, borrow, or hire.
  • Autos you don’t own.

But what if you had sent your employee to pick up from the hardware store instead?

Let’s say one of your guys swings by the hardware store on his way to start work for the day. He changes lanes with a car in his blind spot, causing a minor accident involving two other vehicles while driving his own car.

A lawsuit is brought against your business. Are you covered?

The broad coverage indicated by a symbol 1 has you covered once again. Offering liability coverage against claims and lawsuits for third-party bodily injury or property damage for autos used for your business purposes, you’re covered even if your business doesn’t own the vehicle.

Since he was driving for a business purpose, his accident could be covered under your auto fleet policy.

How to Keep Your Rates Low

While rates are partially determined based on the vehicles your company owns, the drivers who will be operating them also affect the cost.

Costs for Truck Coverage

There are three factors insurers look at when rating your truck to determine coverage cost, including:

Size Class
Because a larger truck is capable of causing more damage, insurers rate trucks based on the gross vehicle weight, which is determined by the manufacturer.

Use Class
This rating depends on how much the truck is driven. Simply put, the less you drive, the less likely you are to be in an accident.

Radius Class
Based on the driving radius you travel within during the work day, your truck will be rated as local (up to 50 miles), intermediate (51 to 200 miles), or long distance (more than 200 miles). Again, the more you drive the greater the chance of being in an accident.

Costs for Employees Listed on Policy

The easiest way to keep your fleet insurance costs low? Check driving records as part of your hiring process.

Coverage for those with poor driving records is going to drive up your premiums considerably.

Listing employees with excellent driving records can not only save you money on premiums, but it can also sometimes qualify your company for discounts, based on your provider.

Be sure to know who you are insuring and that they aren’t bringing up your rates, and then encourage them to make safety a priority.

The Insurance Information Institute recommends outlining and enforcing these policies to help reduce risks to your work vehicles:

  • Outline strict driving rules such as mandatory seatbelt usage as well as ZERO tolerance for intoxicants and cell phone use to help keep your company driving record clean.
  • Establish vehicle use guidelines such as limiting the non-business use of vehicles, encouraging drivers to slow down and take their time, as well as requiring that they lock and secure vehicles, parking in well-lit, secure areas whenever possible.
  • Provide your employees with vehicle safety training and be sure to recognize and reward safe drivers.

Covering all of your work vehicles under one auto fleet policy can help you save. Be sure to talk to your insurance agent about your specific vehicles and uses, as well as the drivers who will be operating them, in order to determine what the policy will cost for you.


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