Van insurance works similarly to a car insurance policy, insuring you against a plethora of different risks associated with your van. Vans aren’t often covered by your typical car insurance policy, particularly if you use it for commercial use or other business reasons.
Van insurance can cover third-party costs should you have an accident. It can also pay out to cover the costs of repair to your van. In some cases, it can cover you against filling up with the wrong fuel or even losing your keys, depending on your policy. Van insurance policies can cover most types of van, including:
- Box Luton vans
- Pickups
- Double or single cab vans
- Tippers
- Light vans.
What Van Insurance Covers
Van insurance can cover you against third-party costs if you are involved in an accident. Typically, van insurance can also pay out and cover the costs of repair to your van, and sometimes the replacement if it is written off or if you need a replacement vehicle while you wait for the repair.
Commercial van policies typically offer extended cover, sometimes related to the contents of the van or the purpose for which you use it. The events covered under your policy will depend on the type of cover you choose.
Key exclusions
Depending on the type of policy you go for, you can get cover for a whole host of risks associated with your vehicle. That said, most commercial van policies won’t cover you for any of the following, no matter your level of policy:
- damage resulting from wear and tear
- mechanical or electronic failure
- theft if you leave the keys in your vehicle
- theft of personal items or tools if you leave the van unlocked
- goods or stock you are carrying unless you add specific coverage for this (if you want to cover this, you’ll need to look into stock insurance).
Common Policy Types
There are several types of van insurance cover you can select when taking out a policy. The policy you opt for will depend on the kind of van you are insuring and the purposes for which you use it.
There are three principal types of commercial van insurance, which are:
- Carriage of own goods. This type of insurance is suitable for anybody who uses their van to carry tools and material to jobs, which is usually the case for tradespeople. Examples might include a joiner or a self-employed plumber who uses a van to carry their tools to and from their jobs. While tradespeople will be covered while taking their tools between jobs, the tools and materials themselves don’t tend to have cover under this policy. The same goes for any other contents in your van. If you are looking for protection for your materials or the contents of your vehicle, consider taking out a goods in transit policy, too.
- Carriage of goods for hire or reward. This type of cover is often suitable for anyone who delivers goods to multiple different destinations and along differing routes. The goods don’t belong to the driver, but rather the customers. Insurance for the carriage of goods for hire or reward also tends to cover the goods inside your van.
- Haulage cover. This type of cover is specific to delivery drivers who deliver single items/orders, typically over long distances, to a set location, such as expensive machinery. A haulage policy also tends to cover the goods you are delivering as well.
Once you’ve decided on the type of cover you need, you will need to determine what level of protection is suitable for your needs. Generally, the levels of cover are:
- Third-party only cover. This type of policy covers the cost of damages to another person, their vehicle or their property which is the result of you driving your van. An example might be rebuilding costs if you reverse into somebody’s garden wall or the cost of replacing somebody’s wing mirror if you knock into it while parking. The third-party only cover excludes any damage to your own vehicle.
- Third party, fire and theft (TPFT) cover. Third-party, fire and theft cover insures you for the same events as third party only cover, but it also covers the loss or damage to your own vehicle, provided the damage is caused by fire, lightning, self-ignition, explosion, theft or attempted theft. If you cause any accidental damage to your own van, this would not be included on TPFT cover.
- Comprehensive cover. This type of policy covers your van for any accidental damage, as well as third parties and their vehicle and property if you have an accident. Comprehensive cover tends to include any fire damage and can cover some of the costs if your van is stolen.
On top of these types of cover, many insurers offer more specific policies for other purposes. These types of insurance may be suitable for particular businesses.
Van Insurance for Young Drivers
Van insurance can be expensive, no matter how old you are or how much experience driving you have. However, those hit with the highest premiums are younger, inexperienced drivers, sometimes having to pay double the price of an experienced driver. According to the road safety charity Brake, 23% of motorists aged between 18-24 have involvement in a crash within the first two years of passing their test. These statistics mean that any type of vehicle insurance, but especially van insurance, is even more expensive for younger drivers.
Some insurance providers now offer specific policies tailored to younger drivers to help them find insurance at a reasonable price. Most insurance providers consider anyone under the age of 25 to be a young driver in the UK.
Fleet Van Insurance
This type of policy provides insurance for two or more vehicles owned by the same business. Fleet insurance is a handy type of insurance for business owners who want to deal with the insurance for their vehicles under one policy with a single renewal date and ensures a consistent level of cover for each vehicle.
Under this type of policy, you can usually insure different makes and models of van, provided you inform the insurance provider of the details of each vehicle. How many vans you can insure under a fleet insurance policy varies between providers, but can be up to the hundreds, or even thousands.
Business owners tend to opt for a fleet van insurance policy as it’s easier to keep track of all their insurance policies for multiple vehicles in one place. Aside from the convenience, fleet van insurance tends to be cheaper than insuring all the vehicles individually – particularly if a company has tens or hundreds of vans to insure. Not only that, but many fleet policies include coverage for any drivers, meaning any of your employees will be able to drive any van in the fleet, reducing the hassle for business owners. However, as the insurer has no information about the drivers they’re insuring, this typically boosts your premiums.
Most insurance providers will allow you to insure a variety of van types on a fleet policy, including:
- pickup vans
- tipper vans
- Box Luton vans
- light vans
- vans with single or double cabs.
Some providers even include an ‘any vehicle’ clause in their policy, which may mean you can insure commercial vans and cars under the same insurance. Another thing to note is that not all providers will allow you to have drivers under 25 on your policy, or over 70. Make sure you check with your provider so that you know the ins and outs of the cover provided before you consider a fleet insurance policy for your business.
Pickup Insurance
For most insurance purposes, pickup trucks are categorised as vans. If you use your van for business purposes, whether that’s for using it to transport goods over long distances, carrying your own tools between jobs or delivering products that don’t belong to you in return for money, you will need a business pickup insurance policy.
Pickup van insurance works in the same way as a regular van insurance policy, meaning you can choose your level of cover from third party only, third party, fire and theft, or a fully comprehensive policy.
Modified Van Insurance
You must declare any modifications you make to a vehicle to your insurance provider. This makes sure that the policy you have taken out matches the van insured so that you retain your cover in all eventualities. While modifications in cars tend to come in the shape of a performance upgrade, such as a turbocharger or a spoiler, modifications in vans tend to be more practical in nature. You might add new seating, beds, storage or other features which make it fit for your business needs.
Although a modified van shouldn’t put you at a higher risk of having a crash, insurers tend to consider modified vehicles as higher-risk owing to their heightened appeal to criminals and the potential for higher risk of fire. Modified vans tend to come with higher premiums, which is why many insurers are now offering dedicated modified van insurance policies. What’s more, if you fail to declare your modifications under your regular van insurance policy, your insurance may be invalidated, which would leave you liable in the event of an incident.
Examples of modifications generally include the following:
- Cosmetic changes such as adding spoilers or body kits
- Racking and storage
- Adding or removing seats or windows
- Adding different power supplies
- Alloy wheels
- Refrigeration, common for food delivery businesses
- Tippers
- Lifting equipment
- Permanent jet washing equipment
- Permanent catering equipment
- Audio or entertainment upgrades.
Calculating Cost
Generally, van drivers can expect to pay significantly more than they would for standard car insurance. There are several reasons for this:
- Vans have larger engines, and are therefore more expensive to repair should things go wrong.
- Vans are larger generally, meaning they can also cause more damage in an accident
- Vans tend to carry more valuable cargo, such as tools, materials and equipment.
How much you pay will largely depend on the level of cover for which you opt. Third party only cover is typically the cheapest option. However, many insurers consider this a low level of protection, and may not be suitable for everyone.
What you use your vehicle for, and where, are also significant factors which play into the cost. If you operate in urban areas with high crime rates, your insurance is likely to be more than if you work in a more rural area. All these factors increase the risk for the insurer, which is why they bump up your price. Other factors which affect the cost are similar to those that have an effect on a regular car policy. Younger, inexperienced van drivers will pay more than their older counterparts, as they have a statistically higher risk of having an accident and needing to make a claim. As vans are larger than most cars, those new to van driving are also at a higher risk of having an accident, which may also mean they pay more.
Final Thoughts and FAQs
Whether you’re a sole tradesperson or a business owner with hundreds of vehicles, insurance is a legal requirement for any vehicle on the road. You must have valid commercial van insurance if you use your van for business purposes, as many people mistakenly think that their private van insurance policy, or even their car insurance policy, can cover them.
Inadvertently invalidating your insurance could lead to costly claims and payouts, or even legal action. Taking out a good van insurance policy can help keep your business on the road when something goes wrong. Still have questions about van insurance? Check out answers to some of the most common queries, below.
- Do I Need Car Insurance or Van Insurance? – If you aren’t sure whether your vehicle constitutes a car or a van for insurance purposes, you can check your V5C vehicle log book. A vehicle categorised as M1 requires car insurance. An N1 or N2 vehicle requires van insurance.
- What Are Van Insurance Groups? – Every van is assigned to an insurance group based on its risk factor, with the cheapest being level one. Factors affecting the group include the size, weight and performance of the van, as well its current market value and how much it will cost to carry out repairs. Van insurance groups are a significant factor contributing to the price of your policy, as many insurers use the insurance group to determine their premiums. Opting for a van in a lower insurance group might help keep your premiums lower, though bear in mind that other factors such as where you park your van, how many miles you drive and whether van has been modified will also have a knock-on effect on the price.
- What About Van Contents Insurance? – If you use your van for business purposes, there’s a good chance that you’ll have some tools, equipment, merchandise or other materials in your van that are expensive to replace. If you are concerned about loss or damage to items that you store in your van, you will need to add contents to your insurance policy. Most providers will offer van contents as an optional extra, though some comprehensive policies may include this as standard. Covering items in your van will increase your premium, so it may be worth taking your tools out of your van at night.
- Can I Get Short-term or Temporary Van Insurance? – Yes, it is possible to buy short-term van insurance. Typically, a short policy ranges from 1 to 28 days, but some providers can offer short-term plans for up to six months at a time. Short-term insurance is usually available for people aged 19 to 75 for light commercial vehicles and vans up to 3.5 tonnes. It can be useful if you’re hiring a van for a day, to move house, for example, or to carry out a job that requires a bigger vehicle if you use a van for work. Short-term van insurance can also be a cheaper option for those who work part-time or only in certain seasons.
- Can I Take My Van Abroad for Business? – Many commercial van policies do include cover for business abroad, but this may not come as standard. In some cases, you may have to add this cover to your existing policy for an additional cost. Make sure you speak to your insurer directly if you are going to take your van abroad for business purposes, to see if the policy covers your destination country. You may want to consider European breakdown cover if you are driving your van abroad, which you can either take out separately or add onto your current policy.
- Can I Get My Company Van Insured Under My Business’ Name? – If the business owns the van, then you can usually find an insurance provider who will insure the van under the name of your business. However, not all providers are willing to do this, in which case the main driver must be the policyholder and the owner of the vehicle.
- Can I Transfer My No Claims Discount From My Car to My Van? – Unfortunately, most providers do not allow you to transfer a no claims discount built up on a car insurance policy to a van policy. You would have to build up a no claims discount on a van insurance policy if you wanted to transfer them to a new policy or a new provider.
