As a DSP owner, it is important to understand what factors may be impacting how your insurance premiums are calculated for your business. Commercial Auto insurance covers your business for dents, dings tows and other vehicle-related property and injury. Discover the four factors that contribute to your how your premium is calculated.
Loss Experience
Your prior accidents are reviewed with a focus on two key factors: frequency and severity.
- Loss frequency represents how often you experience losses relative to your time on road and fleet size
- Loss severity represents the average financial value of a loss
If your loss activity has increased at a faster rate than would be expected for your fleet or if losses are larger than expected, you may experience a premium increase. Premium increases based on loss experience can be mitigated by maintaining a better than expected loss record and operating safely. DSPs with better than expected loss frequency and severity should not receive premium increases based on loss experience.
Changes to Fleet
Have you reported all autos in your fleet to Marsh or are you operating using autos that have not been endorsed to your insurance policy? Your auto renewal will be based on vehicles currently in use as captured in Fleet Tool. For an apples-to-apples premium comparison, we recommend that you report all vehicles and compare premium against the total expiring fleet cost on an annualized basis.
Station Changes
Insurance rating uses the DSP’s station location(s) in rate calculation. If you moved stations or added any new locations, these changes may play a factor in increasing or decreasing your insurance premium.
Tenure
If you have been a DSP for three years or more, your prior loss experience is considered more credible and predicable than that of a new business. Positive driving experience is valued over the course of a DSP’s tenure with Amazon and calculated into insurance rating to develop loss expectations and trends.
Marsh is here to be your one-stop-shop for managing all your DSP business insurance needs. Looking for Safety Training resources for your business? Contact Marsh today to get started.