In today’s business environment, Small Business Owners are getting pinched in every way imaginable. Whether it is having to deal with endless regulations of the local, state and federal government; paying increasingly rising taxes or just competing to keep good employees businesses are facing more costs than ever before. Finding ways to save is more frequently becoming a necessary way to stay in business. If you have employees who drive as a part of normal business functions, than commercial auto insurance is a cost your business must take on. Here are 6 ways to limit how much you have to pay for commercial auto insurance.
Evaluate your drivers periodically
You should be selective in who you let drive as a part of your business operations. Current driving records should be pulled on anyone who is driving as a part of their work responsibilities and it should be updated at least once a year. Going on a ride with them periodically and checking in on them when they are not expecting it are good ways to find out how they are driving while on the clock.
Do not assume your employees are safe drivers. People can be very competent at their job and still be a liability behind the wheel. Having periodic meetings to talk about how you want their driving behavior to be is essential to limiting accidents on the clock. These meetings do not have to be extensive, time consuming or expensive; but they should be specific and regular.
Keep up to date maintenance on all vehicles
Maintenance on a vehicle is more than a periodic oil change. Ensuring the car’s tires are properly inflated and that all engine parts are up to date and running properly is essential to the success of your business. In some extreme cases lack of maintenance can cause a claim to not be covered by your insurance carrier if it can be proven the occurrence was caused because of the lack of maintenance. For this reason, it is important to have up to date maintenance on all vehicles and for it to be documented.
Shop around your policy
Switching your policy every year at the slightest drop in the price of your premium is not the best strategy. Carriers are more likely to give you better coverage or better prices if you are a repeat long-term customer. They are also more likely to work with you when you have a claim if they have sold coverage to you for a number of years. That being said, it is still important to check around in an attempt to make sure your carrier is staying competitive. The guidance of an experienced independent insurance agent can come in handy when you are looking around.
Partner with an independent insurance agent
Many insurance agencies work with only one or a select few carriers. This severely limits the amount of carriers they can get to compete for your business. Independent insurance agencies typically partner with 10-30 carriers. This gives them limitless possibilities to find a carrier that can give you better coverage and you can get it at the lowest rate possible. This will save you time and energy making phone calls when you can just let the agent do the shopping for you.
Make sure you are classified properly
Making sure you are in the proper workers compensation class code can make a huge difference in what you pay for premium on all of your insurance policies. Insurance agents are in the business of managing risk. They are going to make an assumption on the risks your business takes based upon the information you give them. If you rush through the quoting process and do not thoroughly tell them exactly what your business does and more importantly what your business does not do. If they only have a little bit of information, it is in their best interest to assume more risk. With more risk comes a higher premium. These mistakes usually get fixed during an end of term audit, but even if you get a refund of the excess premium you paid, you still have had cash tied up all year on unnecessary premium. That is cash that could be going to other more pressing business needs.