Business insurance costs and cutting back on auto insurance

The economic conditions for business of all sizes is particularly tough, particularly because it’s a real challenge to raise capital. This means the only way of keeping the business on a sound footing is to trim costs. It’s the usual suspects in reducing the number of employees, holding down pay, or getting more productivity for the same pay, finding ways of reaching your customer base on a smaller marketing budget, and so on. One area to investigate is whether you are getting the best value from your fleet of company vehicles and the commercial auto insurance cover. The review starts with who you hire to do the driving. Before you confirm the hire, ask for full disclosure about his or her driving record and/or do a background check.

It will add substantially to your premium rates if you employ drivers who have a bad track record of accidents or convictions for more serious offenses. Similarly, young drivers cost you more. In an ideal world, all your drivers will be very experienced with excellent, trouble-free records.

Now you should think about installing GPS transmitters in all your vehicles. If you are unlucky and someone steals a vehicle, you improve the chances of recovering it. More importantly, you can also monitor where your employees take the vehicle. Although you may think monitoring your staff’s movements is a little underhand, it helps with a productivity plan if you know they obviously take long lunch breaks or divert to shopping malls when they are supposed to be making deliveries elsewhere. With more detailed mileage counts on each vehicle, you can also negotiate for better rates. The more information you collect, the better your chances of being able to earn discounts.

The intention, of course, is to generate savings that can be diverted to different budgets. Think carefully about the limits on the business insurance policies you have. In a commercial auto policy, this means thinking about the amount of medical and bodily injury cover, and the total for liability cover. Small business insurance is all about getting the best value for money at every point in your business operation.

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