Why is Van Insurance More Expensive?
06/02/2024
From managing servicing and MOT appointments to securing the right insurance coverage and topping up the fuel tank, owning a van can be a costly endeavor.
Research conducted by Consumer Intelligence, a data analytics company, reveals that the average van insurance premium in the UK stands at £1,781, considerably higher than the £820 average for cars.
So, What Drives the High Cost of Van Insurance?
Vans typically boast more robust engines than cars, especially commercial vans that often spend extended periods on the road. From an insurance perspective, these factors elevate the risk of accidents and subsequent claims, thereby inflating premiums. Yet, engine size isn't the sole determinant of insurance costs. Let's delve into other factors influencing van insurance premiums and explore potential solutions.
Understanding Van Insurance Groups
Similar to cars, van insurance premiums are influenced by the vehicle's insurance group, determined by various factors such as engine size, part costs, vehicle weight, security features, and performance. Previously, vans were categorized into 20 insurance groups, with group one being the cheapest to insure and group twenty the most expensive. However, post-2016, there are now 30 insurance groups for newer vans, with group 21 being the lowest, offering more affordable premiums.
Navigating Class of Use Considerations
Vans predominantly used for business activities typically incur higher insurance costs compared to those used for private purposes. The increased mileage and time spent on roads associated with commercial vans elevate accident risks, warranting higher premiums. Moreover, certain business-oriented add-ons and policy features, such as goods-in-transit insurance for couriers, further contribute to premium escalation.
Impact of Signwriting and Branding
The effect of signwriting and branding on insurance costs varies among insurers. While some perceive vehicle modifications negatively and increase premiums accordingly, others view branded vans more favorably, assuming drivers exercise greater caution. Additionally, branded vans serve as effective theft deterrents, potentially earning policyholders discounts.
Exploring Driving Behavior Monitoring
Stickers indicating "how's my driving" can potentially influence insurance costs, signaling a commitment to safe driving habits. Although not all insurers offer discounts for such initiatives, research suggests that vehicles displaying these stickers are involved in fewer accidents, prompting some insurers to consider them during premium assessment.
Utilizing Car No Claims on Van Insurance
Transferring no-claims discounts from car to van insurance is feasible, albeit typically applicable to one vehicle at a time. Some insurers offer mirrored no-claims discounts, subject to specific eligibility criteria.
Tips for Cost-Effective Van Insurance
While securing comprehensive coverage is essential, reducing premiums can be achieved by:
- Paying annual premiums
- Installing additional security features
- Parking in secure locations
- Adjusting voluntary excess levels
- Comparing quotes from various providers to secure competitive rates
Ultimately, diligent comparison shopping is key to finding affordable van insurance that meets individual needs and budget constraints.
This article is designed to offer general advice and may not apply to every insurance, broker, insurer, cover or policy. You would need to check the individual policy benefits of each cover with your insurer or broker.
