Fleet vs. Individually Rated Commercial Auto Insurance

Fleet Insurance vs. Individually Rated Commercial Auto (IRCA) Insurance?

There are 2 categories of insurance for vehicles registered in a company name:

Fleet and Individually Rated Commercial Auto (IRCA).

Fleet insurance is typically defined as any policy with 5 or more vehicles registered in a company name. Pricing for fleet insurance varies and is negotiated by the insurance broker and insurance underwriter on a fleet by fleet basis based on a number of factors including the loss ratio, vehicle usage, geography, driver history, CVOR if applicable etc.  Fleet policies can include a variety of types of vehicles ex. Private Passenger, Light & Heavy Commercial. Some fleet insurance policies may include a fleet insurance endorsement like the 21b in Ontario that automatically covers all vehicles registered in the company name helps reduce the administrative workload and potential for gaps due to timing, reporting or human error that can be associated with managing insurance for a fleet.

In contrast individually rated commercial auto(IRCA) insurance functions almost identically to personal lines auto policies where each vehicles is rated based on a rating matrix that is consistent and inflexible based on various risk factors.  Individually rated commercial auto departments are separate from fleet insurance departments and some insurance companies will write fleet insurance, but choose not to write  individually rated commercial auto insurance.

Another resource to better understand automobile insurance is the Financial Services Commission of Ontario of the provincial equivalent

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