When running a private car, if you make no claims on your insurance policy for 12 months, you are generally rewarded with a discount off the following renewal premium of that policy.
With a fleet, things are a little different, due to the sheer number of vehicles that may be covered on a single policy.
With a big enough fleet containing many vehicles, the chances of making no claims over a policy year are very slim. The larger the fleet, the less likely a year will be claim free, so instead a different system is used – the ‘claims experience’.
A claims experience is basically a record of how many vehicles there are on a fleet, the number of claims made, when the incidents they relate to happened, whose fault the incident was, and how much was paid out by the policy holder’s insurer.
This information is used by the insurer to determine several ‘weighting’ factors they use when deciding your fleet insurance premium.These factors generally take the following forms:
- Number of vehicles on the fleet
- Number of claims
- Frequency of claims
- Total amount of money paid out for all claims
- Ratio of claims to loss (money paid out), sometimes called the ‘loss ratio’.
Obviously, the fewer claims, and the less money the insurer has to pay out, the better, so a well managed fleet with well trained drivers should cost less to insure than a similar sized fleet with more and/or bigger claims.