When looking at your company’s budget, insurance premiums likely stick out as a large expense. Everyone wants to cut costs and create a more favorable budget, but the premium for your commercial auto policies often can feel like a huge expense you can’t do anything about. Why are these premiums so high and what can you do to change them?
What Makes Commercial Auto Insurance Expensive?
Some of the reasons premiums are rising are out of your control. Many insurance companies are factoring in new state laws and more natural disasters into their calculations. However, some factors are within your control.
Lawsuit settlements paid by commercial auto policies in California and across the nation are rising. For preventable accidents, these settlements can be in the tens of millions: $39 million for a driver unprepared for icy conditions or $54 million caused by a driver with a history of major driving violations.
What Can I Do To Lower My Premiums?
Many of these large settlements happen over preventable accidents. Distracted and inexperienced drivers are two of the leading causes of accidents for commercial businesses. By prioritizing safety, offering driver training and hiring experienced drivers, you can make fewer claims and get lower premiums.
Commercial auto policies are an essential part of doing business for many companies. Fortunately there may be ways to lower your premiums and make these policies more cost-effective.