Leon Bosch, managing director of the motor trade practice at commercial insurance broker and risk management specialist Arthur J. Gallagher, outlines the key considerations for local authorities when choosing an insurance policy for their fleet.
Arranging the right policy when insuring a fleet of vehicles can be an arduous process. You need to get the best value for money while also ensuring you cover all your needs. However, understanding the different parts of a policy can be a challenge which is why it pays to have good, professional advice from people who know the business.
Here are six key points to consider when choosing a policy and managing the process.
1 Understand your risk
You should understand your risk before you start working with your broker to find an insurer. It is best practice to hold as many details as possible because the more you can provide to underwriters, the better the bids that will be received. It's also worth considering what emerging risks could affect your operations in the future. Look at where your organisation is going and what risks are likely to be encountered on the way. Your broker can help you find solutions to meet changing requirements.
It's also a good idea to retain as much risk as you can reasonably afford. Taking a sizeable excess, for example, can reduce your costs and avoid pound swapping, as well as reducing your exposure to Insurance Premium Tax.
2 Working with insurers
It's worth understanding what additional support insurers can offer you. For example, risk management support may be of value and may sway your decision on which policy to choose. Also, consider what claims-handling support you need as you may be able to use a nominated team rather than a call centre.
Don't be afraid to negotiate with insurers on certain things. For example, if you already have a relationship or contract with key suppliers, such as repairers, adjusters or legal advisers, the insurer may agree for them be the preferred option.
3 Driving restrictions
It helps to have documented profiles of the drivers in your workforce and their responsibilities. This enables you to cross-check the terms, conditions and endorsements of a new policy with their profiles for any clauses which may restrict driving. For example, some insurers restrict the driving of certain vehicles to people over a certain age, while others limit drivers to certain vehicle types or to vehicles of a certain size. If you don't check these details you could find the drivers you have in place may not be covered.
4 Overnight parking
Some insurers will have specific overnight parking security requirements that you need to comply with. For example, they may require vehicles to be kept on locked premises but also may stipulate what security needs to be in place, such as steel-roller shutters and a Redcare Alarm. Check that your security features are in line with these requirements. If they are not, you may need to choose another policy or update your security features.
5 Key security
Insurers are also likely to have key security clauses in their terms and conditions which you will need to be aware of. For example, some require keys to vehicles to be kept in approved, locked cabinets or safes. Some may even require keys to be stored offsite in an approved safe. You should ask yourself if these requirements are realistic for your operation.
6 Choosing a policy
It's important to review your current policy along with other options available to you so you can identify any duplication or gaps in your cover. By working with your broker, you can make sure your policy is fit for purpose. It's also advisable to meet with bidders too, as this gives you the opportunity to explain to the supplier what is really important to you and your operations and they can tailor their bids to suit. Finally, before awarding the contract, make sure it reflects what you really need from your insurance.
By following this advice and working with an experienced broker, you can protect your fleet and go about your operations in the confidence that you have the right insurance in place to keep your business going should you need to make a claim.