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Commercial Van Insurance

Drivers all know that every vehicle on the road must have insurance. If you’re a van driver then this requirement applies to you too – but do you need a special policy if you are going to be using your van for work purposes? In many cases, a commercial policy is essential, so here’s our guide to getting the best deal for you and your business.

Won’t a Standard Policy Do?

If you are a van owner who is using their vehicle for social, domestic and pleasure only, then a standard car or van policy is perfectly adequate. But most van owners have a van precisely because they need it in connection for their job or business. Special Commercial Insurance or Business Insurance will cover you for all of those situations where you are using your van in the course of your work, such as making deliveries as a courier, driving to customers’ houses, or transporting goods back to a shop from the wholesaler.

Remember – having the right sort of insurance is a legal requirement. Even if your van is parked up and off the road for a substantial amount of time, unless you have formally declared it as off-road with the DVLA, it still needs insurance. If you opt for the often-cheaper standard policy and are involved in an accident while using your van on business, you won’t be covered and could be charged with driving without insurance too.

Types of Business Insurance for Vans

There isn’t just one type of business insurance for vans and other commercial vehicles. It’s your responsibility to make sure you have the right insurance for your vehicle, and for the activities you are using it for. The main categories of business van insurance are:

• Hire and Reward – this is the insurance policy for you if you are planning on moving goods which don’t belong for you. This covers furniture removal, or all manner of “man and a van” jobs where you deal with a range of customers and journeys.
• Own Goods – if all you’re doing is transporting your own tools to customers homes to carry out your trade, or buying stock at a cash and carry and using the van to take it to your shop, this is the ideal policy.
• Courier and Haulage – as the name suggests, this is the policy designed to cover haulage companies or vans which travel up and down the motorways with goods.

It’s also important to bear in mind that whatever type of insurance you take, you’re covering the vehicle only. You’re covered for the cost of repair if you have an accident. However, the goods being transported are generally not covered and you will have to arrange a separate goods in transit cover for that risk.

Optional Extras

A commercial van policy will cover the risks to other road users and if you take out a fully comprehensive policy, also the costs of fixing your van too. Most insurers also offer additional extras which you can choose to take or not. The most common add-ons offered are:

• Tools in transit – covers not only for damage to tools, but also theft.
• No claims protection – an additional fee which will protect your entitlement to no claims in the event of an accident
• Courtesy van – the insurer will arrange for you to have a similar van to use if yours is off the road for repair.
• Breakdown – roadside assistance if you break down while using your van
• Legal cover – this covers the legal costs which might arise if you are involved in an accident and the other driver starts legal proceedings against you.
• Misfuelling – this covers you if you put diesel into a petrol van, or vice versa.
• Belongings – you can pay for additional cover to protect your personal items (phone, jacket etc) if they are damaged or stolen in your van.
• Overseas use – if you take your van across the Channel into continental Europe for business purposes, then you should ensure you’re covered for overseas use.

Cost of a Business Van Insurance Policy

Insurance companies set prices based on risk, and your commercial policy is no different. Some of the things your insurer will look at when coming up with your quote price are:

• Voluntary excess – the amount of money you are prepared to put in when you make a claim. The higher your voluntary excess, the lower the price. Set it at a limit you are comfortable with in the event of a claim.
• Make and Model of van – in general, larger vans with more powerful engines pay more insurance.
• Business Sector – some areas of business are more risky, and this will mean additional premiums for businesses operating in those sectors.
• Number of Drivers – as with a car policy, you can have additional people insured to drive your van. Each additional person you add on will increase your premium.
• Claims – perhaps the biggest risk factor is how many claims you have made in the past. If you’ve made a lot of claims, insurers will assume you are a much bigger risk.
• Mileage – a very high annual mileage also means a higher premium to pay.
• Storage – vans locked away in a garage overnight will cost less to insure than vans left parked up on the street or outside your office.
• Alarm and Security – additional features such as an alarm or immobiliser should bring the cost of your premium down.

Shop Around for the Best Deal

Despite the recent court ruling making it illegal for insurers to offer better prices to attract new customers, it’s always good advice to shop around for a better deal when it comes to renewing your commercial vehicle policy. Internet sites are generally pitched at the domestic car user, but some of the bigger insurers and the comparison sites will let you compare prices for vans too. Alternatively, go through a local broker who can access prices from an even wider range of insurers. Although keeping costs down is obviously a concern, remember that the cheapest policy isn’t always the best value.