How to read your commercial insurance quote?

March 30, 2023 Commercial Truck Insurance

If you are worried about not understanding your truck’s commercial insurance quote and need to know the correct way to read it, at Preventty, we teach you how to do it.

Below we share our recommendations to read it correctly to avoid headaches; your right is understanding what you pay for.

 

Main items to pay attention to in a quote

First, quotes may vary from one insurance company to another and will not always have the same format. However, any proposal for commercial trucking insurance can not omit the following:

 

  • Full name of the person insured
  • Address of the person insured
  • Policy effective date
  • Business type (Commodities)
  • DOT (With some exceptions. For example, if you are starting your company, and you still have not processed your DOT)
  • Type of coverage you request to quote and the limit (amount for the coverage requested)
  • The annual cost of the policy

 

When you receive the quote, you must be very rigorous in reviewing all the data because if there are errors, you may have difficulties if you need to use your coverage in the event of an accident.

The name of the person insured must be correct, and the period the insurance company is quoting has to correspond to the period you need (in general, the policies have valid coverage for one year, it is very unusual to find coverage for a longer term). Verify that the amount covered in the proposal is the amount you need for your business;  you must be clear about what you request if you are independent (if you transport your own cargo); also, review what coverages the Freight  Broker you are planning to work requests. It is also essential to define the commodities, that is, the types of cargo you will transport; this is important because the prices of the coverages can vary according to the kind of cargo.

Be careful with the information about the drivers, vehicles, and trailers. First, you must include all the drivers’ names and be very careful with their spelling; verify their spelling is correct since any error will affect the activation of the coverage in case of an accident. If your company has several commercial vehicles, you must include them all within the policy plan since the insurance companies require this. Keep in mind that if you leave a truck outside your coverage plan in the event of an accident, the policy will not be able to cover any damage caused; on the contrary, they can cancel it since it was your responsibility to include all the vehicles in the plan to be able to operate commercially.

Ideally, when activating the policy, your insurance advisor should give you clarity and explain in detail what coverages you have available and in what cases you can use each one.

 

How to know you are getting a good price on the offer?

When analyzing the prices of the policies, you must consider several factors. Insurance companies categorize your profile depending on your financial record; in the face of a bad record, the policy may be more expensive since there is a greater risk.

Prices may vary depending on the state where your company operates. The final price depends solely on insurers’ risk assessments of your trucking company and the client’s needs.

 

What to consider when comparing quotes?

Make sure that when requesting quotes, you provide the same information to the providers; for example, if you asked your first provider for coverage to operate in all states, this same information is what you must provide to the second or third provider because if you change the data, the values ​​of each quote will vary significantly.

When comparing two or more quotes, make sure that the coverage limit they are offering is the same, the number of vehicles included in both quotes is the same, the number of drivers matches, also, the commodities you need, and in general, the conditions of both trucking insurance quotes are the same.

 

Financing plans

Once you have accepted the terms of the quote, you will receive the financing that you had already chosen according to your budget. A financing plan is a strategy that seeks to use and optimize economic resources to develop a project or investment. In this case, it would be the payment of your policy. Usually, you must make an initial payment called Downpayment and continue paying the remaining policy value in monthly installments.

  • First installment: validate the date of the first payment. It must be exactly one month after the effective date; for example, if your policy became effective on March 27th, you must pay the first installment on April 27th. If you have two financings, two independent charges will be made, not a single transaction to cover both coverages.
  • Read the terms & conditions: check the insurance company you choose to work with and make sure the policy is effective; do not forget to carefully read the fine print of the contract since there you will find information of interest to you, such as clauses or consequences for non-payment or late payment. Although all financing contracts are different, all must have this information.
  • Monthly installments and payment dates: remember the amounts and dates of each monthly installment. If your payments are up to date, you will avoid possible penalties. Generally, a limit of up to 10 monthly payments is handled. Financing plans are made annually. It is very unusual for them to be made by semester.
  • Check the insurance agency receipt: finally, if you purchased your policy through an insurance agency, remember to review and validate the agency receipt that is sent to you once the affiliation process is complete. In this receipt, you can corroborate all the insurance information about the payment you made.

 

In summary, 

When requesting insurance quotes for commercial trucks, you should carefully review the conditions of each quotation and not be guided solely by the difference in prices. This way, you will avoid being surprised if you suffer an accident and discover that you did not have all the necessary coverage.

On the other hand, you must keep in mind the insurance companies rates, that is, the rating they have in the insurance market; this will also help you make the right decision. Get advice on the company’s experience within the industry and if they are reliable and have the services you require for your company. It is always better to carry out these processes with professionals and expert advisers who can accompany you to make the best decision. If you need help, contact us at help@preventty.com, and we will advise you at no cost.