South Africa’s notoriously dangerous road system poses a myriad of
risks to any business dependent on mobility. Given the enormous financial and
logistical ramifications faced as a result of the loss or theft of a commercial
vehicle, it’s vital that local enterprise owners understand their specific
insurance needs and ensure they have a solution in place that adequately meets
their needs.
When it comes to commercial vehicle insurance, many insurers offer
standardised packages, along with optional extras, such as Roadside Assistance
and Towing & Recovery.
But not all commercial vehicle operations are created equal - the
roadside assistance needs of a truck owner differ greatly from those of a fleet
owner, and businesses covering shorter distances face significantly less risks
than their long-haul counterparts. As such, it’s important that you understand
what kind of cover your business needs so as to avoid unnecessary excess
payments, stock deterioration and loss of revenue.
Here are a few handy tips to help you pick out the perfect insurance solution for your operation:
Opt
for a flat excess rate
Many insurance companies apply something known as percentage excess, whereby the first amount payable by a client is often astronomical, given the high value of the vehicle. In order to make budgeting easier and to avoid any cash flow crises, rather opt for a flat excess, which makes budgeting in a time of loss far more manageable.
Plan
ahead
You never know when an employee might find themselves incapacitated or unable to work. Rather than losing out on potential business or risking sending an uninsured driver onto the roads, opt instead for an insurance option where the individual drivers do not need to be named or specified on the policy, thus reducing the risk of complications down the line.
Choose
deposit cover
Even though your insurance company might pay you out in full in
the event of a vehicle being stolen or written-off, the potential loss of
revenue while you wait can be devastating to your business. As a result, it’s
wise to opt for deposit cover, which allows you to claim a cash amount of up to
10% of a vehicle’s value, thus enabling you to get back on the road far
quicker.
Like-for-like car hire cover allows you to rent a similar vehicle and keep your business operational while your claim is assessed and processed and your vehicle repaired. As an alternative, vehicle-loss-of-use cover pays a daily allowance towards the rental of a similar commercial vehicle while your vehicle is being repaired.
Plan
your routes
If your business endeavours takes the insured vehicle out of the country from time to time, it’s important to make sure that your insurance policy covers you in full for any incidents that might take place outside the country’s borders. It’s also critical that you specify the times of day you’re planning to be on the roads, as premiums and cover levels differ between day and night driving.
Pay
as you go
If your business operation extends no further than the boundaries of your immediate metropolitan area, you shouldn’t be paying the same premium as a fleet owner transporting goods between Johannesburg and Cape Town on a daily basis. As such, make sure to specify the nature of your commercial vehicle business, as well as the parameters of its operation, so as to ensure that you receive a fair premium price.
Protect
your stock
Transporting perishable goods presents an additional risk for commercial vehicle owners, as a breakdown or unforeseen incident can compromise large quantities of stock. As such, it’s always wise to invest in Deterioration of Stock cover to avoid unnecessary losses. In some instances, it also benefits you to link the cover of your goods in transit to a specific vehicle, as this can substantially lower the premiums you pay.
Manage
your exposure
Those little optional add-ons offered by your insurer might seem unnecessary at the time, but they can have an enormous impact down the line. Lock and key cover and comprehensive roadside assistance etc. can help you to manage your risk more effectively by creating less inconvenience in difficult situations.
Article first appeared in: 
http://www.autoforum.co.za/View-News-Article.aspx?News=10707
