Van Insurance In Depth

What is Van Insurance?

Van insurance is a specialized form of auto insurance that is designed and offered specifically for owners of vans. This form of insurance is primarily purchased by shipping, transportation or service companies who frequently use vans to execute their day-to-day business model.

Auto insurance, in the United States, is a compulsory product; all owners, meaning to whom the car is registered, must obtain car insurance before using the nation’s public highways and roads. As a result of this mandate, all owners of vans, particularly those aforementioned business industries, must acquire an active van insurance policy before operating the vehicle.

Similar to car insurance products, a van insurance policy will fluctuate, in regards to what is covered, the premium, the deductible and the rates, based on a case by case circumstance. Furthermore, van insurance policies can be personalized and tailored to meet a van owner’s specific wants.

How much does Van Insurance Cost?

Van insurance, in most cases, is more expensive than car insurance; this statement, becomes affirmed when a party insures a can used strictly for commercial purposes. That being said, the cost of van insurance is based on a pricing model used to evaluate all insurance products.

Van insurance rates, like so many forms of insurance policies, are delivered following an evaluation or assessment of the applicant’s risk. As a general statement, if the prospective insurance purchaser is more likely to get in an accident than a normal driver his or her van insurance rates will be higher than average.

To evaluate the riskiness associated with the driver, meaning the probability that he or she will get in an accident and thus require a claim, the insurance company will observe the driver’s basic information (age, occupation and credit score) his or her driving record (number of speeding tickets, traffic violations and accidents) and the value of the goods to be insured.

In addition to an assessment of risk, insurance rates for the majority of insurance policies are also calculated by considering the cost of the underlying car or van. If the van is more expensive than average the price of repairing the vehicle will invariably be higher. As a result of this increase cost, the insurance company will charge a higher premium—similar to the buyer, the insurance company is attempting to mitigate risk through the delivery of an appropriate pricing model.

Types of Van Insurance:

The majority of insurance companies will offer separate policies for personal and business van use; the separation is applied simply because the two vans are used differently. Vans that are used for business purposes typically rack up more miles than a van solely dedicated for personal use.

In addition to the extended miles, business vans will also carry heavy equipment as well as multiple people—both of these characteristics greatly alter the insurance company’s risk assessment. Furthermore, a business van typically has visibility, as well as stability issues given the nature of the company; both of these represent safety concerns for the insurance provider.

Van insurance is also typically available to those individuals who rent vans, regardless of time frame or intended use. The majority of personal insurance policies will cover individuals driving rental vans; however, coverage in this sense is severely limited. Rental van insurance can provide additional protection to the drivers, as well as the passengers, of rented vans.

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