Costly Truck Insurance Mistakes To Avoid

Admin July 15, 2019 Commercial Truck Insurance

You spend a lot of time and money running your business, and your commercial fleet is a valuable part of operations. As a wise and prudent business owner, you know that commercial insurance for trucks is paramount to protect your investment. The problem, however, is that finding the best and affordable trucking insurance can be tricky. There are several costly mistakes that you should avoid to bolster your business.

Mistake #1: Not having commercial trucking insurance

Your business needs commercial auto insurance for any vehicle that your company uses for business. Your personal auto policy will not cover vehicles used for business purposes. If your business uses larger vehicles, like tow trucks, tractor trailers, semi-trucks, or construction vehicles, you need a commercial truck insurance policy. This commercial policy is not only required by law but is critical for protecting your business.

Comprehensive Commercial Trucking Insurance

Get the appropriate coverage you need from a trusted insurance provider.

Mistake #2: Not shopping for fair comparisons

Purchasing insurance is akin to buying a new car; not all dealerships are equal. It is essential that you shop around for the best fit policy for your business. Make sure to shop around even before you need insurance; this saves you from making an impulsive decision later on. Even if you already have insurance, it’s worth shopping around to ensure you have the best deal.

Of course, one of the biggest challenges comes from the different kinds of policies and products offered by each commercial insurance carrier. Some offerings might include comprehensive insurance while others do not. It is vital that you look at each part of the policy separately to ensure you are making a fair comparison.

Mistake #3: Not having honest and accurate answers

Part of the insurance buying process involves filling out applications and answering questions. If you do not have correct answers, you might find your company without the proper coverage. Insurance quotes are typically based on specifics, including the exact kind of and size of your vehicles. Guessing on this information will lead to problems down the road.

At the same time, being dishonest on your application is a huge mistake. Sure, it might save you money on the monthly payment, but it will cost you a great deal down the road. Lying on an application can actually leave you completely uncovered in the case of an accident. Be honest when answering questions so you can get the best-fit policy.

Mistake #4: Purchasing too little coverage

While each state may have minimum requirements, keep in mind that these are only minimums. Your business may be best served by having additional coverage over the state minimum. Even if your state does not require it, you should at least cover the following:

  • Uninsured/underinsured motorist
  • Personal injury protection
  • Medical claims coverage

If you are paying on a loan for your fleet, you will most likely be required to carry comprehensive and collision coverage. This protects the lender if something happens to those vehicles. If you do not carry the appropriate insurance, your lender may add their own at a higher price to your monthly payment.

If your fleet contains new or high-value vehicles, you may want to beef up your comprehensive and collision coverage. If there is an accident, the state minimum may not cover your actual losses. This could leave you without a vehicle and without the necessary funds to get a replacement.

Mistake #5: Purchasing too much coverage

Believe it or not, it is possible to have too much coverage. Some insurance companies will pitch add-ons that might not apply to your business. For example, they might suggest a roadside assistance program. If you are already a member of an auto club like AAA, you might already have this program at a better price.

If your vehicles aren’t worth much, it may not make much sense to pay for extra collision and comprehensive coverage. You certainly want to be covered, but you don’t want to waste money on coverage that isn’t suited for your company’s needs. Make sure you know exactly what products are in your package and if they apply to your business.

Mistake #6: Forgetting the deductibles

Your deductible is the amount you have to pay before your insurance kicks in and pays the rest. It’s easy to only look at policies with low deductibles to reduce your share after an accident. This, however, will result in higher monthly payments. In many cases, it’s worth paying a higher deductible to save cash on monthly premiums. You still need to make sure you’re hitting state minimums. It’s also wise to have some money set aside in case there is an accident, and you need to cover the higher deductible.

Mistake #7: Focusing only on price

Sure, you want to save money wherever you can. It’s far too often that we only focus on price instead of the overall picture of our commercial trucking insurance. Unfortunately, price doesn’t tell the whole story and cannot be the only factor considered.

You want to look at the big picture. While the price is undoubtedly a significant factor, we also want to consider a company’s reputation,  experience, customer service, response times, and other elements critical to our business when making decisions. It doesn’t do much good to have the cheapest truck insurance policy if you aren’t able to submit a claim or get a callback.

Mistake #8: Staying with the same insurance company forever

It’s pretty easy to pay the insurance bill each month and never think another thing about it. Some companies even have loyalty programs that make it seem like staying with the same company offers a reward.

When it comes time to renew, this is the perfect opportunity to shop around. You can use your existing policy to guide what you’re looking for while determining if you need to make adjustments or add additional products. You may find that you already have a great deal, but you may also find another deal that will ultimately save your company money.

Have you made any mistakes when looking for commercial trucking insurance? Share your tips by commenting below.