Row of white commercial vans parked on a wet pavement, viewed from the front side angle.

Commercial Fleet Management: 15 Auto Insurance Red Flags to Avoid

August 20, 20252 min read

5-Minute Guide on Commercial Fleet Management - Commercial Auto Underwriting Red Flags

Intended Audience:

Business Owners, Fleet Managers & Organizational Maintenance Personnel.

Commercial Auto Insurance Requirements:

  •   All 50-states require commercial auto liability if:

    • The vehicle is specifically titled to a business entity.

    •  It is used primarily for business operations.

    • It is driven by employees for work-related purposes.

  •  Commercial Auto Comprehensive Insurance can be required when:

    • The vehicle is leased or financed.

    • Required by a contract such as for the delivery of valuable goods.

    • Required for compliance with a corporate risk management program.

    • Needed for travel across the Canadian or Mexican borders.

15-Commercial Auto Underwriting Red Flags:

  • Entities that have had their commercial auto policies cancelled or non-renewed.

  • Incomplete or inaccurate insurance applications.

  • High risk business groups like long distance trucking and delivery services.

  • Excessive claims history to include crashes, theft & vandalism.

  • Poor DOT compliance history.

  • No, or inadequate fleet safety program.

  • Inadequate new driver hiring process. 

  • Multiple drivers with poor driving records. 

  • A high percentage of relatively inexperienced drivers.

  • A greater than 50% driver turnover rate with a non-long haul fleet.

  • No telematics or dash cam use for driver monitoring.

  • Older or poorly maintained vehicles.

  • The use of business vehicles for personal use without proper controls.

  • Poor garaging location making vehicles susceptible to theft or vandalism.

  • No claims management or incident response capabilities.

The Bottom Line:

  • Commercial auto insurance premiums can vary by as much as 400% between what underwriters consider as “good risk ” versus “bad risk” accounts.

  • “Bad Risk” accounts may have to pay up to $15,000 in annual premiums on just one vehicle.

For Additional Information or questions on this Subject, Contact Centurion’s Loss Control Manager, Rob Brooks, at:

(606)434-0739

[email protected]

Disclaimer:

  • This publication is intended for general educational purposes only, and is not to be considered as business, financial or legal advice.

  • Readers should consult with appropriate professionals before making any decisions based on the content of this newsletter.

  • Some of the data &/or statistics referenced within were obtained using artificial intelligence.

  • Centurion Insurance Services and the writer make no guarantees or warranties of any kind, express or implied, about the reliability, completeness or suitability of the information contained herein.

  • We will not be liable for any losses or damages arising from the use of the information provided.



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