Driving schools are quite a lucrative business in South Africa, with many requiring driving lessons to get their license. Budget Insurance reminds driving school owners that they need specialised insurance, such as business car insurance, to protect their business from risk or loss caused by accidents, injuries, or property damage.
What type of insurance do driving schools need?
Insurance can protect the driving school financially in the event of a financial loss or legal action resulting from a driving-related incident. There are several types of insurance to consider when it comes to driving schools in South Africa. Some of these include:
- Public liability insurance. This type of insurance will protect the driving school against claims of alleged negligence or other liabilities that may arise due to accidents or injuries during driving lessons. This is particularly important for driving schools, as they may be held liable for accidents or injuries that occur while students are operating their vehicles.
- Business car insurance. This coverage will protect the driving school’s vehicles in case of accidents, theft or other damage. It is important to make sure the vehicles are adequately insured, including third-party liability coverage.
- Professional indemnity insurance. This type of insurance is important for driving schools because they provide professional services in the form of training and assessment. It will protect the company against claims of professional negligence or errors and omissions.
- Business interruption insurance. This coverage will provide financial protection if the business is forced to close down temporarily due to a covered event, such as a fire or natural disaster.
Remember that the specific types of insurance for driving schools will depend on the nature of its business and its specific risks.
What isn’t covered by insurance for driving schools?
Like many other types of insurance, driving school insurance in South Africa will have exclusions, which are events, actions or circumstances that are specifically excluded from coverage under the policy.
Some examples of typical exclusions in driving school insurance policies include:
- Damage caused by war or acts of terrorism
- Damage caused by pollution or contamination
- Damage caused by pre-existing conditions or wear and tear
- Damage caused by criminal acts committed by an employee or student of the school
- Loss or damage caused by failure of power supply or other utilities
- Loss or damage caused by the failure to maintain the vehicles
It’s important to carefully review the exclusions of the policy and ensure that they are acceptable to you. If any exclusions are particularly important to your driving school, you may want to consider adding endorsements to the policy to provide coverage for those specific risks.
Benefits of insurance for driving schools
Having a good business insurance policy in place comes with many benefits. Take a look at these examples to understand how insurance for driving schools would assist in the following scenarios:
Example 1. A student driver, under the instruction of the driving school, is involved in a fender bender while driving one of the school’s vehicles. The driving school’s liability insurance would cover the cost of the third-party medical expenses and any legal fees associated with the incident, protecting the school from financial loss.
Example 2. A heavy storm caused severe damage to the driving school’s office, causing significant damage and forcing the school to temporarily close down while repair work was done. The business interruption insurance will allow the school to continue operating by covering the loss of income during the closure period.
Example 3. One of the driving school’s vehicles is stolen. The school’s business car insurance policy would cover the cost of replacing the vehicle, minimising the impact on business operations.
Example 4. A student driver under the instruction of the driving school instructor, had a car accident and was found to be at fault. The driving school’s professional indemnity insurance policy would cover the cost of the legal fees and any compensation awarded to the third party, protecting the school from financial loss. So, it’s a bit like having insurance for driving instructors.
Understanding business vehicle insurance
A driving school needs business car insurance[1], which is different from personal vehicle insurance. Business vehicle insurance is important for a driving school because it offers protection against financial loss. A driving school’s vehicles are a significant investment. Without proper insurance coverage, the school could face significant financial loss in the event of an accident, theft, or other covered events.
In addition, it’s important to note that any vehicle used for commercial purposes, like a driving school, must have business car insurance. If a driving school only has personal vehicle insurance, the policy will not pay out in the event of an event, like theft or damage. It’s also a legal compliance in South Africa. All vehicles used for commercial purposes are required by law to have valid insurance coverage. This includes vehicles used for the transport of goods or passengers, as well as any vehicles used by a company or organisation in the course of its operations.
Get insurance for driving schools with Budget Insurance
Insurance for driving schools is critical for the business because it provides financial protection, legal compliance, and protection for student drivers, third-party and driving instructors. It’s always a good idea to consult with one of our Budget Insurance brokers to understand what specific insurance cover is advisable, otherwise, you can apply for a business car insurance quoteonline.
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Disclaimer: The information in this article is provided for informational purposes only and should not be construed as financial, legal, or medical advice.
