The world shifted gears a long time ago – it wouldn’t take much convincing to choose third-party insurance over comprehensive vehicle insurance. However, these schemes both have their pros and cons when it comes to a fleet business. Read on to see how.
Comprehensive insurance is by definition an all-inclusive cover that takes care of all outcomes. As a fleet business owner, you will have a peace of mind knowing that both first party and third-party risks are covered.
Some of the risks covered under comprehensive cover include
- Damage due to acts of God
Fleet insurance with comprehensive cover is especially good when it comes to car theft. However, the high degree of comprehensiveness comes with a catch – on your wallet. Be ready to spend more as this is the most expensive fleet business cover. If your transport business is operating on a shoestring budget, you will have to find a friendlier type of insurance coverage. That’s the point where third-party covers come in.
Third party fleet cover is preferable if:
- You encounter an administrative burden with your large fleet of trucks
- You need to cover all your vehicles under one policy
- Your cars are older models and have significantly dropped in value
- Your trucks are used frequently for third-party operations like transporting client’s goods
Before you sign the deal with a third-party cover provider, it’s wise first to ascertain what is covered and what is not. That will help you see where you can save between a comprehensive cover and the third party cover you have in mind.
Some of the risks covered under fleet vehicle insurance third party only include:
- The cost of fixing someone’s vehicle if you are responsible for an accident
- Injuries and harm to the driver in the line of duty
- Coverage against a comprehensive set of legal obligations, e.g. vehicle registration, licensing and taxation
- Overnight transportation
- Damage to client’s property/consignment in the line of duty
Fleet owners find flexibility and alt of support with third-party covers. The support includes bulk dispatch, bulk processing, and bulk taxing among others (for more information see the DVLA’s Fleet Scheme Information & Benefits Guide
Who Is a Third Party?
In any insurance claim, a third party is an anyone who incurs a loss because of your actions. Their claim is against you the first party. Your insurance company is the second party. Third party claims can be by your driver, passengers, a third party derived, a shop or office you crash into, the government or clients you provide services. In some claims, insurance companies will compensate only third parties while you will have to carry your own risk of the accident.
That is especially so in cases where the crash happens because of your fault. In other cases, the Apportionment of Damages principles is applied so that the insurer calculates and compensates each party, based on the role each played in the accident.
The third-party insurance might be the right cover for your business fleet of cars. Why so? Fleet business is associated with high risk, not just for you, but for your clients and employees as well. Since you can get a single cover for all the vehicles- it is much cheaper in the long run. Nevertheless, if you have the money for it – a comprehensive cover can also take care of your transportation business. So whether you’re thinking about a fleet insurance third party policy or comprehensive policy, think about what you think is most suitable in terms of the specifics – your wallet will thank you for it.