Business on wheels? Ask these 10 questions before buying commercial vehicle insurance

It is a fact that many businesses in the Philippines rely on transportation to run day-to-day operations. Mainly, you deal with arrears related to deliveries, logistics, repairs, and rentals - continuous vehicle movement is involved. In such a case, if you choose to operate without insurance or the right coverage, even a single accident could lead to severe consequences like

Major operation delays
Loss of cargo or goods
Expensive repair
Business downtime
Damage to reputation

Remember, a well-chosen insurance policy will protect your drivers, customers, cargo, and business finances.

Common risks faced by commercial vehicles

Compared to private cars, commercial vehicles experience greater exposure to the road. They end up facing risks like -

Collision (animal and other vehicles)
Fire
Theft
Natural disasters (earthquakes, typhoons, volcanic eruptions, and landslides)
Vandalism, riots, strikes
Driver negligence
Third-party liability

With so many risks on its head, a business owner must choose the right commercial vehicle insurance.

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Also Read: Top 7 risks covered by truck and commercial vehicle insurance

Top 10 questions to ask before buying commercial vehicle insurance

What type of commercial vehicle insurance coverage is usually recommended for business owners?

Commercial insurance coverage usually depends on the type of business operation. A few common options are -

CTPL (Compulsory Third-Party Liability) insurance: CTPL insurance is required by law and covers third-party bodily injuries or death.

Comprehensive insurance: Optional but highly recommended for its broad coverage.

Third-party property damage: It offers coverage against damage to another person’s property.

Fleet insurance: It is recommended for business owners with multiple vehicles.

It is necessary to understand each coverage option to avoid being under- or over-insured.

Also Read: Why every truck business needs Comprehensive Truck Insurance in the Philippines

What risks are excluded under a commercial vehicle insurance policy?

When buying an insurance policy, make sure to enquire about the inclusions and exclusions. Do not hesitate to ask even the most basic questions or to resolve multiple queries.

Your insurance plan includes roadside assistance, Acts of God coverage, collision, and cargo coverage. As for exclusions, the following claims are usually not entertained: overloading, unauthorised drivers, drunk driving, and illegal or unannounced modifications.

How much should I spend on a commercial vehicle insurance policy?

The cost of your insurance policy will depend on several factors, including vehicle type & model, usage (ride-hailing, cargo, delivery), location, route, driver’s profile, and risk level involved.

Tip: Don’t choose the cheapest plan to save money. Instead, go for a cost-efficient policy.

How fast and efficient is the claim process?

It is essential to enquire about the claim process beforehand, as a slow one might negatively affect your business operations. Get information about the average claim approval time, availability of 24/7 customer service, online claim filing, and a list of accredited repair shops.

Also Read: Don't panic after an accident — Here's how to file a comprehensive claim

Is Act of God coverage necessary for my business?

Give it some thought, and discuss with agents and peers the benefits of Acts of God coverage. We’d say the coverage is essential if your vehicle passes through flood-prone areas, typhoon paths, and landslide zones.

You see, given the country's extreme climate conditions and frequent visits by uninvited guests, Act of God coverage seems extremely practical.

Are drivers eligible for Personal Accident coverage?

Yes, your drivers are eligible for Personal Accident coverage. It is one of the most popular and recommended add-ons, as it ensures no workforce disruption, medical expenses, or legal issues.

Usually, Personal Accident coverage is quite affordable and is a good policy inclusion to consider.

Should I be concerned about the insurance provider’s reputation?

The answer is a big YES. You must choose a well-known, reputable, and Insurance Commission (IC) certified provider. This would ensure the following benefits: reliable financial backing, a fast claims process, good customer support, and the availability of numerous accredited repair shops.

Tip: Check the provider’s reputation through online ratings, customer reviews, and years in service.

What documents are required to file a commercial vehicle insurance claim?

The requirements to file commercial vehicle insurance claims vary from one provider to another. Usually, the following documents are asked for -

Vehicle’s OR/CR
Driver’s license
Police report (in case of a significant accident)
Photos of the damage and the incident scene
Insurance policy
Claim form

Note: Having this knowledge will help avoid delays and ensure timely settlement.

How can I legally reduce my commercial vehicle insurance costs?

It is a good idea to know how to reduce your premium costs - there’s nothing better than enjoying optimum protection at an affordable price. Here are a few practical tips: choosing higher deductibles, availing fleet discounts, maintaining a clean driving record, and installing safety devices.

What add-ons will help protect my business?

Having a good understanding of commercial vehicle insurance add-ons will help you choose the best and most effective policy. Usually, the following coverages are recommended -

Opting for the above-mentioned add-on coverages will not only strengthen your policy but also minimise financial losses.

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Also Read: Truck/Commercial Vehicle Insurance 101: What Filipino business owners need to know

Essential tips for first-time commercial vehicle owners & insurance applicants

Checklist before buying a policy -

Compare at least two to three insurance providers
Identify the risky routes
Ask about discounts
Verify repair shop partners
Make sure the insurer is IC (Insurance Commission) certified
Review the provider’s claim process and conversion rate

Common mistakes business owners must avoid -

Choosing cheap insurance over the best value policy
Skipping essential add-ons like Acts of Nature/God
Ignoring policy exclusions
Forgetting to update the provider about the vehicle modification
Not reviewing the claim process

Bottom line

Are you a business owner operating with commercial vehicles such as trucks, delivery vans, or motorcycles? If so, the importance of commercial vehicle insurance cannot be denied. Getting your work vehicle(s) insured is not just a legal requirement but an investment that promises peace of mind, smooth business operations, and no unexpected financial burdens.

Remember, with the right coverage, business owners can operate confidently on the road, knowing their business is protected against unexpected losses.

FAQs

Q1. How often should I renew my commercial vehicle insurance policy?
Ans. Most providers require commercial vehicle owners to renew their policies annually or as required under the policy terms.

Q2. What are the consequences of missing the policy renewal date?
Ans. A missing policy renewal date will lead to cancellation of the insurance plan, leaving your vehicle uninsured. No claims will be honoured post-cancellation.

Q3. Can commercial vehicle insurance be renewed online?
Ans. Yes. Most insurance providers today offer digital services to their clients, allowing them to renew policies, pay premiums, file claims, and more.

Q4. What documents are needed to file an insurance claim?
Ans. You need the following documents to file a commercial vehicle insurance claim in the Philippines: vehicle’s OR/CR, policy copy, driver’s license, photos of damage, and police report.

Q5. Do insurance premiums increase at the time of renewal?
Ans. Your premium might increase at renewal due to factors such as claim history, vehicle age, modifications, etc.

Q6. Will the insurance claim get rejected if the driver is not listed in the policy?
Ans. Yes. Most insurance providers require the vehicle to be driven only by authorised drivers.

Q7. Does commercial vehicle insurance cover cargo damage?
Ans. Yes, cargo damage is covered, given that your policy includes this particular add-on.

Q8. How long does commercial vehicle insurance take to process?
Ans. Most insurance providers take 7 to 14 days to process the claim.

Q9. Are mechanical breakdowns covered?
Ans. Commercial vehicle insurance will cover mechanical breakdown if the policy includes that coverage.

Q10. Will my claim get denied if the vehicle was overloaded?
Ans. It is a strong possibility, as overloading is a sign of negligence on the part of the driver/vehicle owner.

Q11. Do ride-hailing vehicles require commercial insurance?
Ans. Yes, ride-hailing vehicles require commercial coverage, as personal vehicle insurance does not apply to such units.

Q12. Does commercial insurance cover personal use?
Ans. Not necessarily, it is advisable to check the policy terms with the provider.

Q13. What attributes should I look for when selecting a commercial vehicle insurance provider?
Ans. Look for providers with strong claim service, a vast repair network, prompt customer service, and roadside assistance.

Q14. Can I transfer my policy if I sell my delivery pick-up van?
Ans. Yes, you can. However, it is necessary to update the provider.

Q15. What are the common reasons for claim rejection?
Ans. Some common reasons for claim rejection include incomplete documentation, late reporting, policy exclusions, and unauthorised drivers.