You may use your personal car for business purposes when starting a business, but as the startup grows, you must look for a commercial insurance policy. For instance, the basic personal car insurance policy doesn’t cover the loss if the loss happens while delivering products to the client, or while transporting passengers.
Moreover, the personal auto insurance policies also do not cover some specific types of vehicles that are clearly designed for business use, such as tow trucks, mobile food unit etc., and so all such vehicles require commercial insurance policies.
A commercial auto insurance policy is also a must if you have employees who drive the vehicle or you need more liability insurance protection than a personal auto policy can provide.
Since startups and small businesses always look for lower insurance for cars or vans for their business, it takes a little knowledge and some effort on your part. However, the savings can be fantastic. So, here are some tips on saving.
Prior to Purchasing a Vehicle, Make Insurance Cost Comparisons
If you are considering a new or even a used car purchase, research the cost of auto insurance in advance. Premium prices are determined partly by the vehicle’s cost, how expensive repairs are likely to be, its safety history and the potential for theft. Lots of insurance carriers provide discounted rates for cars with features designed to lessen the chances of theft or serious injury. A great way to learn which cars are the best for securing lower insurance rates is to visit the website of the Insurance Institute for Highway Safety.
Seek an Increase in the Deductible
An insurance deductible is an amount a policy holder must pay prior to the activation of any applicable coverage. Seeking a higher deductible amount can reduce premium prices significantly. For instance, a deductible of $500, as compared to $200 can cut the cost of comprehensive and collision premiums by anywhere from 15 to 30 percent. Jumping up to a deductible of $1,000 can produce even more notable savings. Of course, before choosing between car insurance deductibles, it is wise to make sure you have sufficient money in the bank to cover that upfront payment if a claim should arise.
Lower Coverage Levels for Older Vehicles
Eliminating comprehensive or collision coverage on older vehicles is a move worth considering. If you drive a car that has a value that is less than 10 times the cost of insurance premiums, it may make little sense to purchase full coverage. It is possible to learn the value of any given car by consulting with a bank or a vehicle dealer, or by researching the information online at Kelley Blue Book’s website. When renewal times roll around, be sure to make the cost/benefit assessment so that money is not wasted on unwise levels of coverage.
Use One Carrier for Multiple Insurance Needs
Lots of insurance companies offer discounts to those who buy multiple forms of coverage. Multiple vehicle discounts can also be beneficial, as can price cuts for long-term policyholders. The key is to make comparisons among several carrier options and do the math.
Build a Strong Credit History
Insurance costs can be cut simply by maintaining a solid credit record. Carriers tend to price their policies in part by assessing the applicant’s credit history. Statistics suggest that those who have good credit generally file a smaller number of insurance claims. Therefore, always strive to make timely bill payments, do not take out more credit than you truly need and work to keep outstanding balances as low as possible. Review your credit report often and take steps to remedy errors and ensure the accuracy of your information.
Low Mileage Discounts Can Produce Real Savings
There are many carriers willing to provide discounted rates to drivers who travel a lower than the typical number of annual miles. These price breaks can also found for those who participate in carpooling. Many who compared car insurance with Money Expert and explained they’d low mileage got better deals.
Inquire About Group Plans
Premium cost reductions can also be achieved by participating in a group insurance plan, perhaps through an employer, a college alumni group or a professional organization. It really does pay to explore whether or not you belong to an association or another group able to provide access to such a discount.