What your insurer doesn’t tell you

Vehicle insurance is essential for any fleet, but can take up a large amount of budget. Here’s what your insurer doesn't tell you.

Vehicle insurance is a must-have for any fleet. If something goes wrong, you want to know it will be fixed properly and with minimum downtime.  Policies are a minefield of fine print, and even if you diligently read every word, there are some things that may still be a bit vague – and unlikely to be explained until you ask.

• Age matters

Some insurance companies are upfront about the fact that people under and over specific ages are charged more. Others are completely mum on the topic and it can be a struggle to find out how much more you’re paying for being a certain age. As a rule of thumb, 18-year-old’s pay the highest premium as new drivers are a high risk.

Between the ages of 25 to 55 rates are similar, but from 55 you may be paying less, as older drivers are safer drivers, according to statistics. This is contrary to popular believe that older drivers are more inclined to age related driving errors. Apart from driving ability, they are less on the road, as they fall in the retired category. There is a steep decline in the cost of insurance after the age of 75.

Although most professional fleet drivers will fall into the low-risk age category, there are some exceptions. Many company fleets have to accommodate for drivers under the age of 25, and over the age of 55. A good fleet management company will be able to help you negotiate better insurance premiums, and in some cases it can be worked out according to the ‘average’ age of employees.

Many companies also take on young drivers in order to ensure they receive the correct training and become a strong asset to the company. Make sure you know the age limits of your insurance company to avoid nasty surprises when it comes to premiums for learner drivers.

• Insurance is a competitive industry

There’s a pervading misconception that all car insurance policies are basically the same, which is a complete myth. Insurance companies are constantly competing with each other for your business, and they have to get creative with their offering and constantly present better value products

It may sound boring, but it’s worth doing some decent research when shopping for insurance. Companies are regularly offering discounted deals or added services to draw customers, and you may have some room to negotiate a package that better suit your fleet needs.

All fleets are different and have the opportunity (within reason) to negotiate cover that is tailored to your fleet’s purpose and needs.

• Location, location, location

Where your vehicles spend the most of their time can make a big difference in your premiums, all depending on risk. Secure parking and optimized routes to avoid poor road conditions or hijack hotspots can make a difference to the amount you pay for insuring your fleet.

• Battle of the sexes

It’s been the topic of many arguments around the braai, but women pay less on vehicle insurance. It varies, but can be as much as 12%. It’s all about statistics – they show that male drivers tend to be more aggressive on the road and find themselves in need of a claim more often than women.

We’re not advocating employing anyone based on their gender, but if you have a large number of female drivers it could make a difference to your overall payments. It may require some additional admin (proof that specific vehicles are driven by female drivers), and it’s not a ‘traditional’ negotiating tool when it comes to fleet insurance. But with the number of professional female fleet drivers increasing each year, it’s worth looking at.

• Take a course

When you’re shopping for insurance, find out if sending drivers on an advanced driving course will help lower premiums. Many insurance companies take this into consideration. Make sure to find out which driving courses they endorse though, as you don’t want the frustration of attending one that isn’t recognised. Some insurance companies recognise certain fleet training courses (that include advanced driving), so make sure you have a full history of any training your drivers have received in the past.

• Track your fleet

Vehicle tracking devices are a sure-fire way to get your premium reduced. Many new vehicles come with such devices already fitted and you just need to have them activated. If not, there are some excellent products that don’t cost a fortune. Ask your insurer for a list of approved devices (some can be finicky) and get them installed across your fleet. A reputable fleet management company will be able to do all the research, admin and installation / activation for you.

• Type of vehicle

This one is tricky as it tends to change (according to hijacking and vehicle theft trends) and also varies between different insurance companies. When comparing different quotes, make sure ask if your vehicles are on the ‘high risk’ list.

This is where it really helps to have a good fleet consultant help manage the type of vehicles you acquire - they will be up to speed with all insurance trends, and be able to advise which vehicles are best suited to your fleet, that still offer the least risk according to your insurer.

Comparing insurance and wading through the details isn’t anyone’s idea of fun, but it’s worth it in the end. There are many areas where you can negotiate a better deal and drastically reduce your fleet insurance costs in the long run. And yes, getting a fleet consultant to do this for you will show better results.