Just a week after the UK’s decision to Brexit the EU, the Freight Transport Association (FTA), on the 2nd of July 2016, identified what it called its top ten “crunch” issues likely to affect haulage contractors over the next few years and beyond as Britain prepares to leave the single market.
Amongst the many changes the haulage industry might face, is the question of insurance and the extent to which cover arranged in the UK continues to be recognised by the transport authorities in the EU.
It might be timely, therefore, to consider just what is haulage insurance:
- not just in the UK, but throughout the EU, there is a legal requirement for any vehicle – including lorries used for haulage – to have a minimum of third party insurance;
- the rationale for these laws is simple and straight forward – they are designed to ensure that anyone injured or who has their property damaged as the result of an accident involving the HGV is assured if receiving the financial compensation to which they are entitled;
Safeguarding the vehicle
- haulage insurance is not just for the protection of third parties however;
- typically, it also extends to the protection of the vehicle itself against theft, fire and accidental damage;
- because of the high value of the majority of haulage vehicles, these are likely to have the protection of fully comprehensive insurance, against the risk of any accidental damage and cover sufficient to replace the lorry in the event of a total loss;
Keeping the wheels turning
- any haulage operation is only earning money if its vehicles continue to circulate;
- a broken windscreen, breakdown or other roadside emergency has the ability to produce costly holdups for the haulage operator;
- therefore, insurance policies may also have the option of including cover for windscreen replacement, emergency roadside assistance and breakdown recovery;
- different levels of such cover might be offered, depending on the package chosen and the amount paid in insurance premiums;
Public liability insurance
- it is not only whilst the vehicle is moving along the road that accident may happen;
- if a member of the public, a visitor to your yard or one of your customers suffers an injury or has their property damaged as a result of your operations – whilst you are loading or unloading, for example – you may be held liable;
- these types of claim may assume significant proportions and it is common for such public liability insurance to provide a minimum of £1 million of cover;
Employer’s liability insurance
- if you employ others to help run your haulage business – whether as drivers or in some administrative capacity at your depot – the law requires that you hold employer’s liability insurance against their risk of personal injury, sickness or some other medical condition contracted as a result of working for you;
- the law currently requires that you have a minimum of £5 million against such risks and you may be fined up to £2,000 a day if you have failed to arrange such protection.
It remains to be seen, of course, how Brexit might affect insurance for British haulage operators – but there is little doubt that protection against risks such as these continue to be needed.