Tips to Lower Your Rates for Your Business Car Insurance

Lower your business car insurance rates doesn't have to be tricky. Just make sure you understand your business car insurance policy. Lowering your business car insurance tips include (1) hiring drivers with good records, (2) bundling your different policies, (3) comparing quotes from multiple companies, and (4) carefully select company vehicles.

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Zaneta Wood, Ed.S. has over 15 years of experience in research and technical writing bringing a keen understanding of data analysis and information synthesis to reach a wide variety of audiences. She studied adult education and instructional technology at Appalachian State University as well as technical and professional communication at East Carolina University. Zaneta has prepared technical p...

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Joel Ohman is the CEO of a private equity backed digital media company. He is a CERTIFIED FINANCIAL PLANNER™, author, angel investor, and serial entrepreneur who loves creating new things, whether books or businesses. He has also previously served as the founder and resident CFP® of a national insurance agency, Real Time Health Quotes. He has an MBA from the University of South Florida. Jo...

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Reviewed by Joel Ohman
Founder & CFP®

UPDATED: Jan 27, 2021

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Here's what you need to know...

  • Many factors are considered when determining your rate for business car insurance
  • You may find cheaper rates by doing some research and looking into policies from other insurance providers
  • Speak with a representative from your insurance company to find out if they have any advice for saving money on your policy

If you are the owner of a business, there are certain things that you can do to reduce your business car insurance rates.

Having coverage for your business vehicles is imperative but that doesn’t mean you should have to pay an arm and a leg for it.

If you can lower your premiums, you will have more money to spend on other things.

Start looking for cheap car insurance rates for your business by filling your ZIP code into the FREE quote space provided!

Shop Around

One of the easiest ways to reduce your insurance rates is to shop around.

Companies want to compete for your business, and as a business owner, you can appreciate this habit.

One way to compete is to offer rates that are competitive with other insurance providers.

You may have noticed that your insurance premiums have increased a bit each year, even though there doesn’t seem to be any good reason for it.

If you feel like you are paying too much for your policy, investigate policies with other providers. You may find that some are able to offer you lower rates for the same coverage.

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Hire Different Drivers

One big factor that affects what you pay for business auto insurance is the history of the drivers you hire.

  • If you are a small business owner and you are the only driver, it probably doesn’t surprise you that your driving record will be scrutinized
  • If you have multiple employees who will be driving your vehicles or their own, their records will also be looked at and factored in your rate
  • The age of the drivers in your employment will also be factored into your premium

If you have hired drivers with poor records in the past, this will have affected your premium.

To help your bottom line, consider some fresh faces in your business and make clean driving records a priority when conducting interviews.

Drivers between the ages of 35 and 55 are ideal in most situations, as they are considered to be the safest drivers.

If you have teenagers who are driving your vehicles, your rates will be higher automatically even if their records are clean.

Teen drivers are killed by motor vehicle accidents more than any other age group, and their chances of getting into an accident are fourfold compared to older drivers, so says the Centers for Disease Control and Prevention.

Drive a Safer Vehicle

If you drive a car or a van for your business, whether it is for deliveries or another reason, the features of the vehicle will be a factor when it comes to your insurance rate determination.

If you are thinking of purchasing a new vehicle or if you are just starting out in business, you will probably be able to reduce your rate if you buy a vehicle that has safety features.

Insurance companies reward you for features such as anti-lock brakes, traction control, airbags, and motion stability.

Visit SaferCar.gov to see the vehicles that have received the highest safety ratings from the National Highway Traffic Safety Administration.

These vehicles can help you avoid crashes and help keep you safer in the event of an accident, which help to reduce your rate.

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Bundle Your Policies

As with your personal car insurance policy, the more policies that you bundle together, the more money you will save.

If you insure your commercial vehicles with the same company as your personal ones, you will usually receive a discount on your policy.

As a business owner, you should also have a Business Owner’s Policy and/or a general liability business policy.

If you buy your business liability coverage with the same insurance provider as your business vehicles, you can sometimes save up to 15 percent off your premiums.

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Increase Your Deductibles

The deductible refers to the amount that you are responsible for before the insurance coverage kicks in. The higher the deductibles are the more your insurance rate will be reduced.

If you are looking to save money on your premium and you have enough money saved to cover a higher deductible, increase your deductible amount.

If you don’t have enough to pay a bigger chunk in an accident, then you should keep the deductible more affordable and comfortable to cover.

Do not try to stretch your business too thin.

Evaluate Your Policy Annually

Things change in your business over time. Your business may grow bigger or smaller, you may change employees or vehicles, and the number of assets you have will change.

If you do not revisit your policy when changes occur, then you should do so on an annual basis to try to save money.

Some insurance companies give discounts to experienced businesses, such as ones that have been running for three years or more, while others consider five years to be experienced.

If you are driving an older vehicle that is not worth very much, carrying coverage such as collision and comprehensive may be a waste of money.

Keep in mind that carrying liability coverage is a must in the majority of the states, so you need to have at least some insurance on your vehicles.

The Insurance Information Institute lists the states and what their requirements are for this type of coverage.

How Not to Reduce Your Rates

You may be tempted to decrease your liability limits in order to reduce your rates.

In the end, however, it will usually cost you more money because any amount above the limits on your policy is your responsibility to pay.

When it comes to limits, it is recommended that business owners carry at least $500,000 in liability.

This amount is usually enough to cover even serious accidents. Higher limits will cost more, but it will bring you peace of mind and provide adequate coverage.

Quickly compare car insurance rates by inserting your ZIP code into the FREE quote box!

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