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Insurance is one of the top three expenses of operating a chauffeured transportation company. A savvy operator must master how to shop for insurance to get the best rates, coverage, and service.

“Insurance is one of those things that can and usually does cause tension and it really doesn’t have to,” says Phil T. Brun of Kiely, Hines & Associates based in Louisville, Ky.

There is clearly a process in buying insurance for a chauffeured vehicle company. Insurance can seem like a maze, with types such as general liability, auto liability, workers’ compensation, property insurance, and specialized insurance such as sexual harassment not generally covered under other policies. There is also disability insurance and health care insurance for you and your employees.

Step No. 1: Determining Your Coverage Needs

The type of insurance coverage you need is based on many parameters such as whether you have employees or not, whether you own or lease the building that houses your business, state requirements for public transportation, whether you have health care coverage from another source such as a spouse, and whether you desire to provide health care insurance for your employees.

Once you have determined what type of coverage you need, then you must decide how much you need in the form of policy limits or the maximum amount your carrier will pay on your behalf. It is important to determine your needs before shopping for an insurance agency or agent since not all agencies offer all types of insurance and you may need several agents to meet all your needs, including those who specialize in the chauffeured transportation industry.

Carol Bean of TWIW Insurance, a full-service insurance company based in Bakersfield, CA, offers an explanation of some types of insurance that may be beneficial to you (See table on next page).

Step No. 2: Finding an Agent

This is perhaps the most important part of shopping for insurance, says Mark Freeark of Transportation Insurance Brokers, the nation’s largest transportation broker in the passenger transportation industry.

Freeark represents such popular carriers as Lancer and Northland and recommends an agent that is familiar with state, airport, and municipality filings, all of which can be complicated. In some cases, an airport may want a “wet signature” as opposed to a rubber stamp signature on certificates naming the airport as “Additionally Insured.” An experienced agent can cause weeks of delays if a document is not prepared correctly the first time, Bean says.