Small business owners have to run a tight ship if they want to survive in today’s economy. Many are afraid to cut costs when it comes to having good auto insurance for their business vehicles. A fender-bender in an under-insured vehicle could quickly become a significant liability for a small business.
It may sound like common sense, but don’t just sign on with the first insurance company you call. Money-blogger and small business owner Michal Cheney says that it’s important to research ahead of time to get the best deal, as well as to understand the specific coverage you’ll require as a business owner.
“This is something I wasn’t well-prepared for and as a result paid for more insurance than I actually needed,” Cheney writes. “As with any insurance, you should shop around and compare rates. Also, check to see if you are eligible for any discounts.”
Grant Georgiades, a director with U.K.-based firm The Plan Group, says that businesses need to take reducing their risk profile seriously. He recommends that business owners appoint a fleet manager to control their vehicles, and recommends specific duties.
“Ensure all staff existing and new go through a thorough process of producing relevant documents,” says Georgiades, who serves as marketing director. His firm, Plan Insurance, deals with over 40 auto and commercial insurance carriers and searches for optimal premiums and policies on behalf of clients. “Ensure you know how many points drivers have on their license and check this every year. Go for test drives with potential new employees.”
Using certain “best practices” can save you money as well. For example, a Bankrate.com study found that auto insurance carriers actively offer discounts for efforts to keep vehicles safe, such as installing anti-theft devices and anti-lock brakes.
Georgiades adds that using paperless billing and paying for a longer-term policy in advance can save business owners significant cash. The Bankrate.com study notes that eight of the 10 companies it studied charge less for paperless billing—but the big savings comes with choosing longer-term policies.