Vehicle insurance is one of the biggest expenses for truck owners. If you want to be smart about it, avoid these 11 mistakes made by many light truck policyholders.
Mistake #10: Not Knowing What You Insured
A car or an SUV? If you have to ask, your insurance company might not either. But if you don’t know how much weight your truck can carry on a standard auto policy before it moves into the commercial category – which typically doesn’t earn you discounts – then your insurer might understate the amount of coverage.
Mistake #9: Assuming Your Policy Covers Everything
Vehicle insurance typically covers three things: property, liability and medical payments. But not everything is covered. That’s why you had to list all of your belongings on your policy application. If there are things that needed coverage but weren’t listed, they’re not insured.
Mistake #8: Not Checking Your IDV – or Understanding the Coverages
Insurers set a maximum amount to repair your vehicle. But what if you want to replace with something nicer? Many companies now offer option-to-purchase agreements. That allows you either to buy a replacement vehicle of a certain type and quality, or a cash settlement. Your carrier will charge you for the new vehicle based on its condition.
Mistake #7: Assuming Your Truck is Fully Covered for Hired/Non-Owned Vehicle Use
This is an extension of the ‘assumed covered’ mistake above. If you assume your policy covers everything but it doesn’t, what happens if you hire somebody to drive your truck?
Mistake #6: Not Understanding Your Deductible Amounts
Deductibles – the amount of a claim that you’re responsible for – are an area where carriers often look to offer discounts. But they need to be understood in order to earn the savings.
Mistake #5: Assuming Your Personal Auto Policy Covers Your Truck When You’re Home
Insurance companies usually require trucks to be insured for commercial use when they’re on the road, but that doesn’t mean they always need to be insured when they’re parked at home.
Mistake #4: Not Changing Your Insurance Company When You Change Insurers
Stajcar says many people have insurance through their employer. That’s fine, but if you get a new job and your policy is no longer being paid automatically from your paycheque, you need to contact your insurer. Otherwise, they will consider you as a new client and start your policy at the beginning.
Mistake #3: Claiming on Your Truck Insurance Instead of Your Auto Policy
This is an area where truck owners can be confused. Some carriers will offer to remove the truck from your auto policy and then insure it as a commercial vehicle instead (a higher premium).
Mistake #2: Assuming You Can Afford Your Insurance
If you can’t afford insurance, your truck will become your problem. Having no policy is fraud, and fraud comes with very stiff fines in Canada.
Mistake #1: Failing to Read Your Policy Documents
Carriers do a lot of things differently, so it’s a good idea to sit down and read the policy documents. The only way to know what your policy covers is to read it.
What Is Light Truck Insurance?
It’s coverage for light trucks based on weight. A standard auto insurance policy covers them up to 10,000 pounds or 4,500 kilograms. Anything heavier requires a commercial vehicle policy.
What is the difference between car insurance and light truck insurance?
A standard auto insurance policy covers them up to 10,000 pounds or 4,500 kilograms. Anything heavier requires a commercial vehicle policy.
What happens if I hire somebody to drive my truck?
This depends on how often and for how long you do this. If it’s only every so often and for a short time, then there shouldn’t be a big problem. If it’s a regular, constant job and the driver is using your truck for his business, then this would be considered commercial use and may be covered by a commercial vehicle policy.
Does my personal auto policy cover me when I’m home?
It depends on how you use the truck. If it’s only used around the work site or within 50 kilometres of your home, then no. But if you take it to the grocery store or head out of town, your personal auto insurance policy should cover you.
What if I get into an accident and the damage is less than my deductible?
You pay your deductible but don’t claim it from your insurer. It may not be a good idea to drive without insurance, though. If you’re caught, the consequences of driving uninsured include a possible fine of up to $2,000, six demerit points against your licence and a suspension for up to two years.
What are the consequences of not being insured on my truck?
It’s fraud, and it comes with very stiff fines.
By And By
What are your thoughts on these 11 mistakes? Have you made any of them before in the past when it comes to light truck insurance, or do they sound like something that could happen to someone else? Let us know by leaving a comment below. We’d love for you to share your most interesting stories about how you found yourself making one (or more) of these big mistakes with your light truck insurance!