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In the private sector, almost everyone knows how to insure a car – with mandatory third-party liability insurance, non-compulsory partial or fully comprehensive cover and a package of additional insurances that can be tailored to one’s needs. Companies, however, often own several vehicles. Although each may be insured individually, it is usually impractical as the number of cars constantly changes, and they are often used by different people. Fleet insurance is by far a more sensible solution, which not only saves time and administrative effort but also money. The fleet insurance premium usually is a significantly lower cost than the sum of individual insurance premiums.
If your business owns five or more vehicles, they can be insured under a fleet policy, which is automatically adjusted if the fleet increases or some cars are taken out of service. You don’t need to worry about any of this and can concentrate on running your business.
In principle, fleet insurance includes (almost) the same elements as private car insurance. Third-party liability insurance is compulsory for all vehicles on the road. Company vehicles are not excluded from this regulation. Other components are optional but often strongly recommended.
Compulsory third-party liability insurance protects against any financial consequences of damages caused to others by your company vehicle, regardless of whether the person driving it is you or your employee. That policy covers property damage, personal injury, and injuries inflicted on animals.
Following the example of the private sector, partially comprehensive fleet insurance protects against the financial consequences of damage for which neither you nor other drivers are responsible.
Typical cases covered by partially comprehensive insurance:
A fully comprehensive car policy includes all the benefits of partially comprehensive insurance, supplemented with coverage of damage that you or your employees may cause to the company vessels. It doesn’t matter if you hit a pole with the back of your van while parking or if you cause a collision.
The extent of benefits is tailored to individual needs. Coverage for collision damage is always included. In the event of total damage, the actual value or an addition to the actual value will be paid, depending on the purchased insurance policy. In the case of partial damage, only the repair costs are paid.
Mandatory third-party liability combined with partially or fully comprehensive insurance provides thorough coverage. However, business practice in many industries shows that additional insurance is a useful option in numerous cases.
Below we describe some examples.
This insurance covers damage caused to a parked company vehicle by unknown perpetrators. This damage is not covered even by fully comprehensive insurance, so a supplemental cover is required to protect against costs incurred in such a manner.
Partially comprehensive insurance covers damage to car windows, but not rear-view mirrors, headlights and bulbs. Supplemental insurance covers these parts as well, according to the options purchased.
It includes roadside assistance for vehicles up to 3.5 tonnes (often also for vehicles over 3.5 tonnes) – indefinitely in Switzerland and usually up to 90 days abroad. The insurance company also provides a replacement vehicle if you cannot continue your journey due to a car malfunction. In addition, the driver and passengers are entitled to medical assistance under this insurance.
Once you have purchased supplemental insurance, all items transported by you and your employees remain covered, be they work-related objects or personal belongings. You can opt for coverage of work objects, personal items or both.
Running a red light resulting in an accident is considered gross negligence and usually increases the insurance premium – unless you have taken out additional insurance against a premium increase due to gross negligence. In such a case, the insurance company waives its right of recourse.
The addition to the actual value was discussed above – it applies to the total loss. The addition can be, for example, 20% of the effective actual value of the vehicle and is paid by the insurance company, together with other due compensation.
The key factor in calculating the insurance premium is, of course, the scope of benefits. Depending on whether you want only mandatory third-party liability insurance or a whole package, premium amounts can vary significantly. Other criteria include, for example, the number of vehicles, the fleet’s claims history over the last few years, the company’s activity and vehicle characteristics (age, type, engine displacement and power, car value).
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