
By Darren Willetts ,
UK Corporate Sales Leader, Marsh
07/07/2025 · 4 minute read
Managing a large fleet of vehicles is a challenging job and if the unexpected strikes, you need a policy that can protect your operation, liabilities and assets.
The motor fleet insurance market presents unique challenges that can significantly impact your bottom line and with motor insurance premiums on the rise, it’s crucial to stay informed and proactive in navigating this landscape.
Managing costs is crucial for the success of any fleet operation. While the overall insurance rates in the UK have seen a reduction of 6%, motor insurance has largely defied this trend. In fact, during the first quarter of 2025, motor insurance premiums increased on average by 10%, which can lead to considerable cost increase for large fleet operators.
This increase has been driven predominantly by an increase in the cost of vehicle repairs.
Understanding how insurers calculate premiums is essential for effective fleet management. Typically, the composition of an insurer's premium includes various factors such as:
Despite the average rate increase in the fleet insurance market, there are still opportunities for well-managed fleets to secure competitive premiums. Here are some example strategies to consider:
As outlined earlier, the cost to transfer fleet risk to the insurance market is approximately 50% more than claims costs alone (when you include Insurance premium Tax (IPT) at 12%). This is an expensive method to deal with claims, however it does remove uncertainty and provide peace of mind for large catastrophic losses.
However, where claims costs are predictable, supported by high quality data and analytics, there is opportunity to consider a different approach that allows large fleet operators to remove:
This can be done is a controlled fashion, after reviewing balance sheet strength, risk tolerance analysis and risk appetite discussions.
There is also the opportunity to recover the VAT (20%) on own damage repairs/replacement vehicles.
If the rising cost of your motor fleet insurance is becoming an issue then our experts are here to help you understand the intricacies of your insurance needs and identify opportunities for improvement or alternative strategies (such as the above) to support future cost savings.
By leveraging our insights and resources, you can position your fleet for success in a challenging market.
Contact your usual Marsh representative, or contact our team today to discuss how we can support you in optimising your fleet insurance strategy. Together, we can ensure that you stay on the right side of the market and achieve the best value for your fleet.