There are various things to consider when leasing a vehicle for business travel, and it’s important to purchase the best insurance policy for both your business and your employee while driving. Here are just 5 handy tips to help you pick the correct insurance policy as well as save your business some unnecessary expense in the long run.
Business lease agreements are required to be in the company’s name
When purchasing a business lease agreement with your insurance provider, it’s important that your company name – rather than the driver’s – is on the insurance certificate. This can be either the name of the company itself or director’s name.
It should also be noted that the insurance provider may request an official letter to establish that the employee is authorised to drive the vehicle on behalf of the company. So, when do you need business car insurance? Also, what type of cover do you need?
When do you require business car insurance?
Business car insurance differs from standard insurance as well as commercial car insurance that covers delivery vehicles or taxis. You will need business car insurance if you are a vehicle owner who uses their vehicle for both business and pleasure.
Therefore, if you’re using your car to commute to work or many different office sites or business locations, you will need business insurance. Similarly, if you require numerous employees to use the company car for business reasons, then business insurance will be necessary.
Business insurance can be more expensive than standard car insurance
Drivers who use their vehicles both for business purposes and in their day-to-day errands are considered riskier drivers. In light of this, your business insurance policy may charge higher premiums than those of standard policies.
You may see purchasing a standard car insurance policy as a loophole in the system; a means to maybe get a cheaper premium. However, failing to disclose your vehicle for working use is a criminal offence – and, if you are found guilty, your insurance could be invalidated.
Choosing the correct vehicle can lower your business premiums
Like with all sorts of car insurance, your premiums are higher or lower depending on a number of different variables. One of these variables is the type of car your drive. Insurance providers group vehicles into 50 groups to help decide the most suitable insurance for each customer.
Obviously, a Ferrari is deemed to be riskier than a smaller vehicle, so this should be taken into account when you are purchasing your business lease vehicle. Do you really need a diesel engine? Would a smaller, more economical vehicle instead suffice for your business?
Commuting falls under the remit of business car insurance
Under the guidelines of business car insurance, commuting to work is considered part of the package. Therefore, if you are involved in an incident during your commute with standard car insurance, you may not be able to benefit from the same significant payout.
However, there are lower premium packages available that cover both social and commuter travel, allowing drivers to purchase other packages rather than the higher premium packages of business car insurance.