Van insurance explained

In this simple guide we'll explain the two main types of van insurance, the levels of cover you can expect to be offered, and some tips for lowering the cost of your van insurance premiums. Let's take a look.

Commercial insurance or private insurance?

Vans serve a wide range of purposes, and this has a bearing on your insurance options. Insurers will want to know if you intend to use the van for commercial purposes, or simply as a private vehicle. If you are planning to use your van for any aspect of your work, you will need to take out commercial insurance. This includes using your van to travel between different work locations, even if the van is not involved in the work itself.
If you require commercial insurance, there are two main types of cover to choose from. Carriage of your own goods insurance will cover the tools of your trade as well as any personal possessions you may keep in the van. It will cover either raw materials or finished products, as well as any waste materials that you may be transporting for disposal. If you are carrying goods on behalf of a company, you will need either haulage or courier insurance. These cover items in your van that do not belong to you. The difference between the haulage and courier categories is based on the number of drop-offs made during the journey. If you make more than three drop-offs a day, you are considered a courier for insurance purposes.

What are the main types of cover?

There are three main types of van insurance, each offering a different level of cover.

Third-party only

This is the most basic type of van insurance, and the minimum required by law. It covers you for any damage you might do to another vehicle, but it won't cover the cost of repairing your own vehicle. It also won't cover accidental damage, fire, theft, or loss of items within the vehicle.

Third-party, fire and theft

This is the same as third-party insurance, but it will also cover you in the event of fire or theft.

Comprehensive

Comprehensive van insurance gives you all the protection of third-party, fire and theft insurance, whilst also covering the costs of repairing your van if it is involved in an accident. Some comprehensive policies come with other extras such as breakdown cover and windscreen protection, but this is up to the individual insurer.

How can I get a good deal on my van insurance?

Van insurance is expensive - there's no getting around it. However, there are a few steps you can take to reduce your premiums.

Safety precautions

If you are insuring your van against theft, insurers will base your quote on the likelihood of it being stolen. This is partly out of your control as it depends on crime rates in your area. However, you can still reduce the likelihood of theft by keeping the van in a locked garage overnight and fitting it with an alarm or immobiliser. Taking these precautions should result in a cheaper insurance quote.

No claims discount

Building up a no claims discount is one of the most effective ways to save money on your van insurance. The longer you go without making a claim, the more you are likely to save.

Voluntary excess

The excess is the amount you agree to pay towards the cost of any claim. All insurance policies come with a mandatory minimum excess, but you can volunteer to increase this. This means that you pay more in the event of a claim, but the cost of your insurance will be lower.

Reducing your mileage

The more time you spend on the road, the more likely you are to be involved in an accident. Taking steps to reduce your vehicle's usage can result in lower insurance premiums.

Pay annually

Most insurance policies give you the choice of paying annually or in monthly instalments. Paying annually will save you money as you will not be charged interest on each instalment.