Hong Kong is a city where space is at a premium. As such, it has one of the best public transportation systems that the world has ever seen. A concerted effort has been undertaken as the population of the city has ballooned over the years to reduce the number of cars on the road and get as many people into the city’s trains and busses as possible. This is for a number of reasons, but perhaps the biggest and most pragmatic one of all is simply that space needs to be saved as much as possible in such a densely populated urban area. By keeping the overall number of vehicles in Hong Kong low, and keeping the roadways as clear as possible, we keep traffic moving and reduce the amount of pollution the city sees.
Of course, not everyone is able to only utilize public transportation for all of their needs. In particular, businesses need to have vehicles on Hong Kong’s roads delivering their wares and bringing shipments to their locations. The economy of Hong Kong depends on businesses having their vehicles able to move about the city freely. As such, the economy of Hong Kong also relies on commercial vehicles in the city being legally insured, per local motor insurance laws. Here, Kwiksure looks at what it actually takes to obtain insurance with some commercial auto insurance tips.
Tips for your new car insurance policy
1) Know your desired level of coverage
As with individual private car insurance, commercial car insurance policies also largely are based on two types of plans: third party liability insurance and comprehensive insurance.
For those that don’t know, third party liability insurance will provide coverage for any damages caused to third party people or property by your company’s vehicles. This means the costs incurred others will be met by your insurance. Any damage to your own vehicles will be up to your business to address, as third party liability insurance provides no benefits for damages to insured vehicles.
If you do want your insurance to cover repairs to your vehicles after damages caused by your own drivers, you will want comprehensive car insurance. This type of insurance will pay for such damages while also including third party liability coverage
It is also worth mentioning here that, while individual private car insurance will have a minimum annual third party property damage limit of HKD 2 million, this limit for commercial auto insurance can be as low as HKD 1 million. The more cautious of you may want to consider securing a plan with a higher limit to make sure you are not left to pay any damages out of pocket.
2) Know your fleet
When you apply for any type of commercial auto insurance, you will need to inform any potential insurance provider of exactly what type of vehicles they will be insuring. They will need to many details about all the vehicles covered in your commercial fleet, including:
Vehicle accident history
Your particular insurer may ask for information on your vehicles in addition to that listed above.
You will also likely need to know want your vehicles’ permitted gross vehicle weight (PGVW) will be. This PGVW will be the maximum weight that your insurance policy will allow your vehicles to carry while still maintaining coverage. The rule of thumb here is that the higher the PGVW, the higher your premium will be. This means you will want to your listed PGVW to be as low as it can be while still making sure that your vehicles never go over it. Vehicles that are found to be over the PGVW when it is in an accident may see any claims stemming from the accident denied.
3) Know your routes
What you drive certainly matters when you are securing commercial auto insurance, but so does where you drive. Believe it or not, the routes, or lack of routes, that your commercial vehicles are likely to take can have a impact on your car insurance premiums.
If your vehicles are expected to take the same route every time they are driven, that lessens the potential risks that they are exposed to in the eyes of insurance companies. Likewise, if you have a delivery vehicle that may end up going anywhere and everywhere in Hong Kong and beyond, that raises the level of risk.
Be sure that any declared permanent routes are adhered to with your commercial vehicles, though. Deviation from the agreed upon route could end you up in hot water with your insurance provider, and claims made for accidents that happen outside of a route may be denied.
4) Know your discount
If your company and drivers have a good driving record, you may be eligible for what is called a No Claims Discount (NCD). In other words, if enough time goes by without you making any claims against your commercial auto insurance policy, you may end up saving money on your annual insurance premiums.
The discounts provided by an NCD become greater overtime, so while you may only get a 5% NCD after a year of safe driving, this discount could rise to as much as 30% off after 5 years of safe driving. Ask your insurance provider for their specific policies regarding No Claims Discounts.
5) Know your details
When you apply for commercial auto insurance, you will need to supply the insurance provider with all of the relevant information they require. On top of the vehicle details listed above regarding vehicle information, you will also need to provide information relating to yourself, your staff, and your business.
For the owners of your business, this means providing personal details such as:
Date of birth
For your business, this means providing:
Type of business
Years in operation
Number of vehicles owned
Number of drivers
For your drivers, this means providing:
Number of claims made in previous years
Names of drivers
Driver license numbers
Of course, specific insurers may ask for additional pieces of information, and you will also want to be clear about the types and levels of coverage that you require when you make your application.
Get in touch
Now that you have all of our tips on what is needed to secure commercial motor insurance for your business, it’s time to find the best plan for your needs. The problem is, there are many different motor insurers in Hong Kong, and each one has a number of different plans and benefits to choose from. So how can you quickly and easily identify your best options? One great way is to partner with an experienced licensed motor insurance broker like Kwiksure!
Our agents have the knowledge necessary to answer all of your Hong Kong car insurance policy questions, and we won’t just sell you cheap car insurance. We’ll sell you car insurance that gives you the best value while still providing all the benefits you need. Contact us today for your free plan comparison and price quote!