10 Factors that Affect your Business Car Insurance Rates


Most people are surprised when they hear how much their auto insurance would cost. The same goes for business owners that have to pay for their employee’s insurance. Business vehicles have to be protected at all times. Of course, all people would enjoy paying less money on insurance premiums. This is why they should get informed about the numerous factors that can affect how much one pays for auto insurance. These factors add up and influence the final value that you need to pay at the end of each month, no matter whether you own a business or you pay for your personal insurance:  


  • The type of car  

The vehicle’s type is the first factor that is going to influence how much you pay for auto insurance. In business, the vehicle’s type depends on the specifics of the tasks that the driver must complete. The cheapest vehicles to pay for are economical, smaller ones. Sports cars or bigger vehicles (mini-vans, trucks and so on) are more expensive in terms of insurance.  

  • The purpose of the car 

Secondly, the vehicles you purchase for your employees should be appropriate for the activities they engage in. This defines the purpose that the vehicles have. The more your drivers need the car and the more they engage in long-distance drives, the higher the premium you will pay for auto insurance. This happens because the odds of accidents are increased tremendously when a lot of driving is involved each day.  

  • The company’s location 

Your company’s geographic location will influence how much you pay for your vehicles’ insurance. The rates that influence how expensive auto insurance is in certain parts of the world are influenced by the criminality rate, the theft rate and so on. If your company is located in a safer area, the premium you pay for auto insurance might be lowered drastically.  

  • The age of the driver 

Depending on the age of your company’s drivers, you may need to pay more or less for auto insurance. Younger drivers will be costlier in terms of auto insurance because they are considered more prone to being part of an accident. If your drivers are mostly over 30 years old, you will pay less for the insurance premium.  

  • The marital status of the driver 

Even though it seems like this aspect wouldn’t normally influence the cost of auto insurance, it does. If your company’s drivers are married, you need to check the driver status for the driver’s spouse. If it is not perfect and the person was previously engaged in car crashes, the auto insurance rates for your drivers will go up. In some cases, auto insurance companies don’t require to specify the marital status of the drivers, which means you can get rid of this policy.  

  • The driving record of the driver 

As you may have presumed, the driver record of the persons who are going to drive your company’s vehicles will be relevant for increasing or decreasing your auto insurance rates. The driving experience of the person, as well as the history of tickets that the person received, will weigh a lot in determining how much the auto insurance will cost for your business.  

A person that has a clean driving record will require a much smaller auto insurance premium. Moreover, the longer a person drove in the past, the smaller the auto insurance premium. If your business is entirely based on driving, make sure to implement this as a condition when you hire new drivers – a clean driving record. It will make everything both safer and cheaper.  

  • The company’s claims history  

Whenever you claim a file as a business, the insurance company that you work with will lose money on its behalf. This loss will be reflected in how much money you pay at the end of each month on insurance rates. Keep in mind to file fewer claims if you want to get better rates on your business auto insurance. This is one of the trickier factors that influence the overall premium. In case you were wondering why is my auto insurance so expensive, this might be the hidden answer.  

  • The company’s credit history  

If your company has an overall bad credit score, then you might have to pay a lot more on your business auto insurance premiums. The reason why the company’s credit history affects how much money you pay on auto insurance is that paying bills to predict how risky you are as a client. For instance, if your company hasn’t paid a lot of bills lately or it is drowned in debt, the auto insurance company will see that and take it into account when assessing the risks which they are exposing themselves to. This is why you might pay more on your insurance premiums. Keep your company’s credit score positive to reduce your costs in the long run.  

  • The company’s past insurance coverage 

In case you want to work with an insurance company for the first time, they will try to dig into your past and find your previous experience with an insurance company. Because you own a business that is public, it will be much easier for insurance companies to find that sort of information. If your previous insurance coverage didn’t end well, you will have trouble with finding another company which can trust you and charges you normally.   

  • The type of coverage required  

Depending on the deductibles you want, your company may pay higher or lower premiums for auto insurance. As you may have guessed, you will pay more for an insurance type that covers both property damage and bodily injury and less for one that covers fewer types of damage. Keep in mind that insurance companies often give bigger companies with a lot of vehicles they need to ensure considerable discounts, especially if you set up a long-term contract between your company and the insurance one.