Posted on 09/14/2011, by Jeremy Edsall
Is Going “Green” Right for Your Fleet?
With the ever-rising cost of fuel, alternative fuel vehicles are a popular choice to help save long-term fleet costs, as well as reduce company environmental impact. Alternative fuel options are available in a number of vehicles including sedans, SUVs, vans, pickup trucks, dump trucks, carts, forklifts and more. But what do “green fleets” mean for fleet risk?
Some insurance carriers are now offering discounts on covering alternative fuel and hybrid vehicles. However, the premiums for alternative fuel vehicles tend to be higher to begin with.
The more expensive premiums for alternative fuel vehicles are due to higher expected costs of repairs for the more complex technology that alternative fuel vehicles contain.
When exploring alternative fuel vehicle options, be sure to consider the following:
• Higher initial investment – Alternative fuel and hybrid vehicles usually cost more to purchase because of their advanced technology, but they also often include “luxury” options like GPS systems.
• Alternative fuel supply – More and more alternative fuel stations are becoming available across the country. However, if vehicles travel, fuel availability needs to be examined.
• Increased insurance cost –Alternative fuel vehicles are still relatively new so fewer mechanics are educated and equipped to repair them currently. This causes an increase in insurance premium costs because of higher potential repair expenses. Although, cost differences should level out as alternative fuels become more common.