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Differences Between Small and Large Fleet Insurance

Differences Between Small and Large Fleet Insurance

by Priya Agarwal

There are many things required to manage fleet businesses for a better run like having proper fleet management software and ensuring a great insurance plan is among one them.

An insurance plan brings a ray of hope and safety by bringing back support to your capital and other investments in case of any unfortunate accident or other damages. 

Insurance plans are designed by insurance companies for the needs of both large and small fleet companies. These plans are specific and tailor-made according to the needs and problems of the fleets and play a greater role as a supporting cushion. 

If you are confused about whether you should go with small-scale fleet insurance plans or large-scale plans. This guide will help you to understand the key differences between them both.

Life Insurance Coverage

Life insurance coverage is the most important thing when it comes to picking up any insurance policy for your fleet. If you go on comparing insurance for large and small fleets there is not a major difference between them. 

Both small fleet and large fleet insurance coverage help in bearing the cost of much destructive loss in case of an accident. The coverage in case of small and large fleets include- 

  • In case of physical damages during an accident
  • Loss due to bad weather or vandalism 
  • Saves your fleets in case of robberies 

 Charges for Life insurance

You need to pay some amount on a periodical basis to continue your insurance term policy for your fleets. This amount is also known as insurance charge and it is different for both small fleets and large size fleets.

In the case of a small fleet having one or two dashcam trucks, the charges are paid on a term basis and on a per fleet basis. It suits the small fleet’s business and helps them keep their costs in check.

Large-size fleets have many plans to opt for when it comes to selecting the right kind of insurance charge. One of the first is the Mileage charge insurance plan. 

The mileage-based insurance plan charges an amount on the basis of distance traveled in a single day. It can be traced down easily with the help of a fuel monitoring system

The benefit of Mileage based plans is that it allows the addition of more fleets without any change in the insurance terms. Mostly these plans are generally accessible to fleets having more than 20 vehicles. Smaller fleets can not subscribe to these plans.

The second option that large-size fleets can opt for is the policy of the gross revenue. In the gross revenue policy, you need to pay a monthly basic charge. 

The charge depends upon the monthly revenue generated by your fleets. This method is more simple and allows the window of expansion without thinking much as the premium does not change with the addition of new fleets.

Factors to consider for selecting a premium

There are some factors that you must keep in mind before going for a premium plan. Some of these are-

  • You must select a plan as per the number of vehicles in your fleet.
  • If you are thinking of expanding the size of your fleet go for a plan that allows expansion without change in the premium.
  • It is important to look out at every factor before deciding the right plan for you.

Policy as per the Drivers

There are two kinds of policies depending upon the size of the fleets. As small fleets are not much systematic the drivers are randomly selected and are not professionally registered. 

In the case of bigger fleets, the drivers are officially registered and have a skilled license.

Random Driver Policy

Random driver policy is mainly made for small fleet companies as it allows the freedom of driving any vehicle to a single driver. Giving you more flexibility in terms of driver usage and work commitments. 

These policies are ideal for small fleets and help in saving a lot of costs by reducing the workforce. 

A dashcam truck loaded with other facilities like fleet management software and fuel monitoring system can receive better premium plans as compared to an ordinary fleet without a proper vehicle tracking system and route optimization software.

Registered Driver Policy

Registered Driver Policy curates to the needs of large-sized fleets. As these fleets have different types of vehicles that required a special skill set for operation, the drivers are assigned on the basis of skills. 

In registered driver policy, the driver is allowed to drive only a particular vehicle.

Both policies have different connotations as any driver policy allows some sort of freedom but in cases of accidents, the premium increases on every other vehicle and hence increasing the cost manyfold. 

It is advised to small fleet owners to adopt the practice of assigning specific drivers and to sign a registered driver policy for better returns.

Summing it up

Managing fleets involves a lot of factors like having a proper vehicle tracking system, proper GPS tracking system for trucks, route optimization software, dash cams, and adapted insurance plans.

Getting the right insurance policy for your fleets is not an easy task. You need to look at the various aspects of your business and compare the different policies of different companies. 

The important thing to keep in mind before signing for any insurance plan is to keep in check your needs and then see which plan suits your needs the most. 

Small size fleet insurance and large size insurance both have their merits and demerits both. 

Study them carefully before getting one.

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