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FLEET INSURANCE
Does your business depend on its vehicles for success? Make sure you have the right cover for your fleet. Find out everything you need to know here.
What is a Fleet?
A fleet is 2 or more cars or motorised vehicles belonging to a single company used for transporting goods and the day-to-day operation of the business. A fleet can have cars, vans, trucks, taxis, HGVs, and minibuses.
Fleet Management in South Africa
Since 2013, projections have been favourable for the growth of the fleet management market in South Africa. Originally, the percentage of business fleet vehicles was projected to grow to 32.5% in 2020. But in 2019, the percentage was already at 34.6%.
Current projections forecast a penetration rate of up to 63.1% in the total population of vehicles owned by companies by 2023. Fleet management is popular because it is cost effective, it distributes risk, and it can save your company money on insurance costs because the cost of fleet insurance is lower than insuring each car individually.
What is Fleet Insurance?
Fleet insurance is a form of car insurance for businesses. It covers all the vehicles owned by the insured business under one policy. Businesses can insure a fleet of motorised vehicles under one policy against risks like theft, fire, accidents, and third-party claims.
How Does Business Fleet Cover Work?
Distributed Risks
By insuring all your business vehicles under one policy, fleet cover distributes the company’s risk broadly. The policy covers cars, trucks, and commercial vehicles in such a way that the insured company only needs to pay once for each type of risk. If the company had chosen to insure each individual vehicle on an individual policy, the company would effectively pay for each risk over and over (per vehicle).
Affordable Fleet Insurance Premiums
The insured company usually only needs to pay a single monthly premium for all the vehicles in their fleet. Insurers often calculate this premium using a single risk profile instead of having to assess each vehicle’s risk separately for each individual insurance policy.
Commercial Fleet Plans on Offer in South Africa
In South Africa, insurers can customise your fleet cover to suit your business and fleet size, but packages differ. Plans can include third-party only cover designed to mitigate liability risks related to your fleet, a combination of third-party, theft, and fire cover, and more comprehensive plans.
You can choose insurance that covers any driver driving any vehicle, or you can choose fixed drivers for specific vehicles. Because fleet policies save companies time and effort and lower the cost of insurance premiums, it is a popular form of insurance.
Who Needs Fleet Insurance?
Ideally, any business that owns more than one vehicle needs fleet cover. If your business owns only one vehicle, you can purchase business insurance for cars. Companies that operate in the logistics and transportation industries can benefit from this type of insurance.
How Many Vehicles for Fleet Insurance?
To get fleet cover in South Africa, you need 2 to 500 business vehicles.
What Does Fleet Insurance Cover?
Fleet insurance covers two or more business vehicles that are owned by your company. One policy can cover your entire business’ complement of vehicles, from office cars to heavy-duty trucks and delivery trucks. The amount of cover you get depends on the type of fleet insurance policy you choose and the types of vehicles you want to insure.
The types of packages on offer can be categorised into three options: comprehensive fleet insurance, limited fleet cover, and liability or third-party fleet insurance. Some insurers allow you to purchase optional added benefits that insurers can include in your policy, such as travel outside South Africa’s borders, sound equipment, and cover for non-standard accessories. To learn more about what extras are available, you can inspect the policy before signing.
Comprehensive Fleet Insurance
Comprehensive plans typically offer you the greatest amount of cover for a wide range of risks related to your business fleet. Insured events can include damage and loss because of accidents, intentional acts like theft or hijacking, acts of nature like hail or floods, and fire. Third-party claims are usually covered, and comprehensive plans often include extras like car hire options and 24/7 helplines.
Limited Fleet Insurance
What is covered will differ between various insurance providers. Generally, limited fleet insurance options include cover for fewer events. Theft, hijacking, and third-party insurance are usually included, but your fleet will not be covered against the cost of accidents to your company or for acts of nature.
Third-Party Liability Fleet Insurance
Known as the most affordable type of fleet insurance, third-party only plans usually only cover claims against you in accidents involving vehicles from your fleet. If you are being held liable for damage or loss to other people or their property because of an accident involving your fleet vehicles, third-party insurance should cover the amount of the claim and legal costs.
Who Can Drive on Motor Fleet Insurance?
Some insurance providers allow for any driver to drive any vehicle, while other plans require you to select specific drivers for specific vehicles. Either way, drivers need to be licensed, and vehicles need to be roadworthy for claims to be accepted.
Do You Need Other Types of Business Cover?
On our site, you can find out everything you need to know about Commercial Vehicle Fleet Insurance , Courier and Delivery Insurance, other insurables, such as heavy duty truck insurance, business car insurance, and goods-in-transit insurance.
How Much Does Car or Fleet Insurance Cost?
Insurance companies usually determine the monthly premium for fleet insurance based on the size of the fleet, the type and age of the vehicles being insured, their condition, and your claims history. Routes driven and, in some cases, driver qualifications or records may also be considered. Fleet insurance tends to be more affordable than insuring each vehicle on its own.
If you want a lower premium from your fleet insurance company, you can give your drivers access to driver training and encourage safer driving behaviour in your company. If you, as the fleet owner, can prove your drivers drive safer, it can help with lowering premiums as well as claims processes. Road safety and driver behaviour are often factors in determining the overall risk profile of your entire fleet.
Insurance companies may require a minimum number of vehicles in order to qualify for fleet insurance versus business car insurance. All the vehicles must belong to the same company.
DISCLAIMER: The information provided in this article is meant for informational purposes only and should not be construed as legal, medical, or financial advice. Facts stated in this article are correct at the time it was published.
