Managing risk in your business is an important factor in how well your company performs. When you run a motor vehicle fleet, there are a number of risks that you need to consider and mitigate.
Letting employees drive your cars or trucks means you’re responsible for their safety on the road. This extends from vehicle damage to personal injury. Not to mention, if your vehicles have to be off the road for any reason, it could dramatically affect your ability to bring in an income.
So it’s easy to see why having the right commercial motor vehicle insurance is crucial.
When vehicles are off the road
Depending on what you use your company’s vehicles for, having them off the road for any length of time could range from inconvenient to significantly damaging for your business. Not having your delivery trucks ready to go, for example, could have a knock-on effect; if you can’t deliver your products then you can’t get paid for them. If your products are perishable, then your losses could be higher since you can’t simply store them and then sell them when your trucks are back up and running.
If your sales staff depend on their company cars to see customers and bring in more business, having their car off the road will seriously impact their ability to see those customers and reach their sales targets. This can cause frustration for sales staff who may then find it hard to achieve their bonus; all because their car was off the road for too long.
As well as the cost of lost business, there’s the cost of repairs or replacement vehicles. Depending on the extent of the damage, a vehicle could be off the road for a few days or it may need to be replaced altogether, which is expensive and takes time.
Managing the risk
Many business owners avoid managing risk by saying that it won’t happen to them, or that they run a comprehensive preventative maintenance program, or that their staff are careful and safe drivers. But, of course, the real world is unpredictable and, no matter how carefully you’ve managed the risk inside your business, there are always external factors that you can’t control.
However, that doesn’t mean you shouldn’t try to manage risk. Preventative maintenance and driver training are both important and useful ways to do that.
The value of the right insurance (and the right advisor)
Of course, one of the most common ways to manage motor vehicle risk is through insurance. The right insurance will ensure your business is not disrupted for too long if an incident does occur. For example, your policy could include rental vehicles to keep you up and running while yours are being fixed.
Importantly, working with a reputable insurance broker can increase the chances of your claim being paid sooner. That’s valuable because it reduces the amount of time you spend in limbo, wondering whether you’ll be able to replace or repair the vehicles in a timely manner. You can get back on the road and back to business-as-usual faster.
Remember, the cost of insurance shouldn’t be the only deciding factor. More than one business owner has regretted paying lower premiums when they discover they aren’t covered for the range of risks they thought they needed
Rather than simply looking for lower premiums, it’s worth finding a balance between premium affordability and the quality of the policy. A reputable broker will be able to negotiate the best deal whereby you’re well covered without overspending.
Commercial motor vehicle fleet insurance is different from regular car or truck insurance in that your business can cover multiple vehicles and multiple drivers on one policy. That simplifies matters and gives you economies of scale in terms of cost.
It’s important to talk to your advisor about how you use your vehicles, what they represent in terms of your ability to operate, as well as any risk factors you face (such as driving long distances, or carrying dangerous loads). Then, your advisor can help you find the right policy for your business to keep you on the road.
Talk to an NZbrokers member today, we can help your business.