Retailer’s Guide To Commercial Van Insurance


The home delivery market has boomed in recent years for a number of reasons, but one of the biggest reasons is that today’s consumers have become accustomed to more immediate results, from online banking and minute-by-minute news updates to one-click job applications and instant messaging. 

This also applies to retail, with online businesses, in particular big-name retailers like Amazon, offering delivery in as little as 12 hours! This has led to an increased need for commercial vans so that businesses and couriers alike can offer delivery and meet their customer needs. 

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So whether you’re a retailer about to start offering home delivery or whether you’re currently relying on couriers and hoping to branch out on your own, you might be considering getting your own van. In any case, you’re going to need van insurance, which is where we come in. 

In this guide, we’re going to offer a retailer’s guide to commercial van insurance so you can take your business to the next level. 

What is a commercial van?

Before we start looking at commercial van insurance, let’s first just determine what classifies as a commercial van. 

The official classification under HMRC is that a commercial vehicle is one that weighs in excess of 3.5 tonnes or is capable of moving a payload of more than one tonne. Because of this, the umbrella term also includes lorries, tractors, vans, pick-up trucks and car-derived vans. Of course, in the case of retail, it’s most likely to be a small van, 3.5-tonne van, pick up or box van. 

Commercial vans are also classified as being used for business purposes only. This is because your van’s tax status, as well as your insurance and MOT responsibilities, will be different if it’s for business, not personal use. 

However, if after this you’re still unsure whether your van classifies as a commercial vehicle or not, you can check online or with an insurance provider for more details. 

What is commercial van insurance?

Keeping all of the above in mind, if you’ve got a commercial vehicle, you need to make sure you’re ticking all the right boxes, including getting the right insurance. Commercial van insurance is a specific policy, unlike a standard vehicle insurance policy, which is why it’s so important to know the difference. 

A commercial policy is designed to cover your van for business usage, but as every business is different, these policies have been broken down into three different types: 

  • Carriage of own goods: This covers your van to transport business-related goods or tools, for example, if you’re a self-employed gardener or plumber
  • Carriage of goods for hire or reward: This is when you have to transport goods for other people, to multiple locations
  • Haulage: This type of insurance differs from above as although it’s transporting goods for others, it’s a single delivery over a longer distance

In the case of retail, carriage of goods for hire or reward and haulage are going to be the best options, though which you choose will depend on the nature of the goods you’re shipping.

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You can also get the usual different levels of cover, including third-party only, third-party, fire and theft and fully comprehensive. 

What does commercial van insurance cover? 

Your commercial van insurance can be as basic or as comprehensive as you want, but in most cases, this will cover you for breakdown, damage, accidents and theft. If you really want to protect your business, there are some additional extras you should consider too, and these include: 

  • Windscreen cover 
  • Misfuelling cover
  • Trailer cover
  • A courtesy van
  • Lost keys

These extras might cost more on a monthly or yearly basis, but they can definitely save you money should a problem arise. For example, should the van break down when you have deliveries to make, in order to keep your customer happy, you want to get back on the road quickly. 

Similarly, should your van get stolen with goods still inside, you can get back some (if not all) of the money to replace these goods. 

How much does commercial van insurance cost?

At this point, you might be wondering how much commercial van insurance is going to set your retail business back. Unfortunately, there is no one answer. The cost will depend on the type of cover you choose, but it will also depend on: 

  • The type of van you have
  • How many vans you have in your fleet 
  • Your business activities 
  • Your claims history 
  • Any additional drivers 
  • Milage and estimated journeys 
  • Whether it has additional security features 
  • Where your van is kept overnight 
  • Whether you pay monthly or annually 

You will need to take all of this into account when choosing your insurance provider. The good news is, you can compare policies before settling on the one that’s right for you. 

How to compare commercial van insurance

Nowadays, comparing insurance of any kind has never been easier. Firstly, you can go directly to multiple insurers to see what deals and policies they’re offering if you prefer to do it that way. 

But even easier than that, online comparison websites make it easy to compare policies from lots of companies all at once, providing you with the best price and cover. 

Just be sure to take into account what vehicle you have, the type of cover you need and how comprehensive you’d like the policy to be.

Do I really need commercial van insurance?

Finally, as it’s likely that commercial van insurance will be more expensive, you might be asking yourself, ‘do I really need commercial insurance?’. 

Put simply; the answer is yes. 

By law, you must insure your van, and if you don’t have the right kind of insurance, you might be shooting yourself in the foot later on. After all, without the right commercial insurance, your retail goods might not be covered should a problem arise. 

So, although legally, you could get away with a standard van insurance, this could come back to haunt you if something happens. So it’s always best to have the right insurance for your retail business.