September 2012, TruckingInfo.com - Feature
Your customers rely on you to deliver, and by keeping your vehicles on the road, your business will be more profitable. Simply stated, time is money. Within the world of commercial auto insurance, we've found that there are some common misconceptions that could cost your business time and money.
To help you clear up these misunderstandings, we've collected some of the more common "myths," along with suggestions of what to consider when thinking about buying a policy that fits your company's needs.Myth:
If cash flow for my business is tight, there's nothing I can do to lower insurance costs.
Fact: There are a couple of options to look into. First, request a policy review from your insurance agent or carrier to make sure your truck value and premiums are up-to-date. They'll work with you to adjust your coverage limits if applicable.
Another option to investigate? Payment plans. Rather than paying your policy premium in one annual payment or quarterly installments, you may be able to spread your premium over monthly payments, helping your insurance bill fall in line with your cash flow.
Myth: When my trucks are out of use or in storage, I should cancel the insurance policy. There's no need to insure my truck if it isn't on the road.
Fact: Consider moving to a storage or comprehensive-only policy during temporary down time. This will protect your truck from things like theft, vandalism and fire while it's in storage, while also keeping continuous coverage, which can keep your overall insurance bill lower.
Myth: When it comes to my truck, if it isn't broken, don't fix it.
Fact: Regularly checking your brakes and not overloading your truck is a very proactive approach to keeping your insurance premiums low. To put it in terms of dollars and cents, a pattern of equipment violations could cost a trucker an additional $300 to $2,000 in annual insurance premium. The routine maintenance pays off long-term.
Myth: All insurance companies handle their own claims with employed claims representatives.
Fact: Some insurance companies use third-party claims representatives. Check if your insurer has representatives specially trained to handle commercial auto claims. The better your claims service is, the quicker you'll be back on the road.
Myth: The economy is rough, so I should consider canceling my coverage all together, or at least lower to minimum liability, just until profits rebound.
Fact: Don't do it. Here's why:
1. Going without minimum liability insurance is illegal in many states and should only be an option if you are temporarily putting your vehicle out of service.
2. Dropping your insurance now means you'll pay more to get a new policy later since most insurance companies want to see proof of continuous coverage to get the best rate.
3. You might not be the only one looking to save money, and if your truck is hit by an uninsured or underinsured driver, you could be left paying for damages.
Myth: All insurers offer 24/7 claims service.
Fact: Not necessarily. Some commercial auto insurers may have limited hours, which could affect your ability to get back on the road fast.
Wonder if one of your perceptions about vehicle insurance is myth or fact? Talk to a local independent agent. He or she can answer those questions and help you determine which coverages are right for your business. Independent agents can offer multiple coverage packages, prices and service levels because they represent a variety of companies.
Progressive, in business since 1937, offers a wide range of coverages, including non-trucking liability coverage, cargo insurance, refrigeration breakdown endorsement and general liability insurance.
Read more about saving on insurance and other business expenses in HDT's May 2012 cover story, 10 Ways to Cut