Ensure You’re Not Under Covered and Overpaying for Auto Insurance

Author, Casey Craig, Account Executive, Rancho Mesa Insurance Services, Inc.

Image of adult male driving car.

Auto insurance prices are continuously rising. What is the reason for this and what can be done to cut back on the cost? There are many factors that lead to the carriers needing to increase their rates. We are going to discuss exactly what some of the reasons for the increases are; and more importantly, what business owners can do to offset price increase as much as possible while receiving adequate coverage.

Distracted drivers are causing more claims every year. Repairing a vehicle has become more costly as newer models have technology features such as sensors and back-up cameras. People using their cell phones while driving can cause them to have a diminished reaction time, which is leading to more severe high impact accidents. This is pushing medical costs up at a rapid rate, leading to an increase of claims dollars. Implementing a “No Phones While in a Vehicle” policy could reduce claims drastically and keep your employees safe.

There are many ways that carriers can get out of covering a loss, and employees driving their vehicles to and from job sites can really come back to haunt you if they do not have adequate coverage limits. Make sure that you have Hired and Non-Owned Coverage! Hired and Non-Owned is the coverage needed for the carrier to cover losses on vehicles that are not on the company’s policy, such as rented or employee owned vehicles. Employers need to make sure that employees have adequate personal auto insurance limits. The California minimum coverage limits of $15,000/$30,000/$5,000 can get exhausted very quickly in a serious accident, and lawyers are getting very good at finding grey areas to drag the employer in. You should consider reimbursing your employees to offset the increase in premium for them. Some carriers will apply subjective credits to your company auto premium if they know your employees need to have higher limits to drive for you.

One of the biggest gaps that brokers see when they audit policies for prospects is they are using the wrong symbols, thinking they are covered for a claim, and end up not having correct coverage. Most reputable carriers will offer Symbol 1 for your liability insurance and it is imperative that you use Symbol 1 vs. Symbol 7. Symbol 7 only covers vehicles described in the declaration and leaves limited coverage for vehicles acquired after your policy begins.

Rancho Mesa Insurance Services is a National Best Practices Agency 13 years in a row. We strive to make sure that our clients are without gaps in their coverage. Call (619) 934-0164 to ask about Rancho Mesa’s proprietary programs that help maintain clients’ safety and get them the lowest premiums possible. Register here for the free Fleet Safety webinar to learn how to increase vehicle safety, control vehicle accidents, safeguard long-term profitability, and ensure that your fleet safety & accident prevention programs are up-to-date.