Fleet Insurance for Construction Companies: The Complete UK Guide
Key Takeaways
- → Construction fleet insurance must be rated for carriage of own goods; standard fleet policies for cars or vans are not the same product.
- → Third Party Working Risk is excluded from all standard fleet motor policies; plant vehicles used as tools of trade need a separate endorsement or CAR policy.
- → CHAS and SafeContractor accreditation can positively influence underwriting terms with specialist construction fleet insurers.
- → Hired-in plant and subcontractor vehicles are not automatically covered; each requires explicit declaration.
- → Site parking risk, overnight security, and multi-site operations all affect your premium more than most construction business owners realise.
- → The construction sector is among the highest-risk categories for fleet underwriters; specialist brokers with dedicated construction panels produce meaningfully better results than general comparison sites.
Construction companies operate some of the most demanding fleets in the UK. A typical mid-size contractor might run a mix of panel vans for tradespeople, tipper trucks for spoil removal, flatbeds for materials delivery, supervisor cars, and specialist plant, all with different risk profiles, different driver pools, and very different insurance requirements depending on what each vehicle is actually doing at any given moment.
This guide covers everything a construction business needs to know about fleet insurance, from the cover types that are genuinely required (and those that are often misunderstood), to the specific exclusions that catch contractors out, to the practical steps that reduce what remains a consistently expensive line item on any contractor’s accounts.
Why construction fleet insurance is a specialist product
Fleet insurance for a sales team and fleet insurance for a construction company are fundamentally different products despite sharing the same generic label. The core reasons are: the nature of the vehicles, the way those vehicles are used, and the environments they operate in.
For a standard commercial fleet, the primary risk is road traffic, collisions, third party liability, theft. For a construction fleet, those risks apply equally, but they are layered on top of site-specific hazards that standard fleet underwriters are not equipped to price: vehicles operating in uncontrolled environments, reversing near excavations, loading and unloading heavy materials, parking overnight at exposed sites, and in many cases operating as working plant rather than pure transport. The construction sector consistently records the highest workplace fatality rate of any UK industry, a reality that specialist fleet insurers factor into their underwriting.
The practical consequence is that construction businesses need to work with brokers and insurers who understand the sector. A policy designed for a fleet of company cars will contain exclusions that leave a construction fleet dangerously underinsured, sometimes without the business realising until a claim is declined.
What vehicles does a construction fleet typically include?
Construction fleets vary considerably by contractor type and scale, but the vehicle categories that insurers encounter most frequently are:
If your fleet spans more than one of these categories, you are almost certainly operating a mixed fleet. The underwriting approach for a mixed construction fleet is more complex than for a uniform fleet, and it is important that your broker submits a complete vehicle schedule with accurate descriptions of each vehicle’s use rather than a simplified summary.
Cover types construction businesses need: what they actually mean
Construction fleet insurance is not a single policy but typically a combination of covers. Understanding what each element does, and crucially what it does not, prevents the gap that leads to declined claims.
| Cover type | What it covers | Construction relevance | Included as standard? |
|---|---|---|---|
| Fleet motor (comprehensive) | Vehicle damage, third party liability, fire and theft while vehicles are in transit or parked on public roads | Core requirement for all road-going vehicles | Yes, this is the base policy |
| Carriage of own goods | Materials, tools, equipment, and plant belonging to the business while in transit | Essential for all construction vehicles transporting materials or tools | Must be declared as vehicle use type; not automatic |
| Third Party Working Risk (Tools of Trade) | Third party liability when a vehicle is operating as a tool: excavating, lifting, compacting | Critical for any plant vehicles that operate on site | No; excluded from all standard fleet policies |
| Contractors All Risk (CAR) | Contract works, own plant, hired-in plant, public liability during construction operations | Broader site cover; fleet motor does not replace this | Separate policy; not part of fleet motor |
| Goods in transit | Loss or damage to goods, materials, or equipment while in transit | Required if materials have significant value in transit | Optional extension; must be requested |
| Employers’ liability | Claims from employees injured as a result of their work | Legally required for all employers; not part of fleet policy | Separate policy; legally mandatory |
| Public liability | Third party injury or property damage from business activities | Fleet motor covers road traffic incidents; public liability covers site activities | Not part of fleet motor; separate or included in CAR |
⚠️ Common misunderstanding
Many construction businesses assume their fleet policy covers all activities associated with their vehicles. It does not. Fleet motor insurance covers road transit and parking. Once an excavator starts digging, or a telehandler starts lifting on site, the fleet policy is no longer responding to that risk. Third Party Working Risk or Contractors All Risk cover is required. This is one of the most frequently misunderstood coverage gaps in the construction sector.
Construction Fleet Insurance: Key Facts
- ✓ Standard fleet motor policies exclude Third Party Working Risk on all plant vehicles without exception.
- ✓ Carriage of own goods must be explicitly declared as the vehicle use type; it is not assumed by default on a standard fleet policy.
- ✓ Fleet motor and Contractors All Risk are separate policies that must be coordinated to avoid gaps between road transit and site operations.
- ✓ Hired-in plant vehicles must be individually declared to your insurer to be covered during the hire period.
- ✓ Tipper trucks, flatbeds, and low loaders over 3.5 tonnes require an operator licence, which must be disclosed at policy inception.
- ✓ CHAS or SafeContractor accreditation, combined with clean claims data and telematics evidence, produces the best renewal outcomes with specialist insurers.
Third Party Working Risk: the exclusion construction businesses must understand
Third Party Working Risk, sometimes referred to as Tools of Trade Risk, is the liability that arises when a vehicle is being used as a working tool rather than as transport. It is not an obscure niche exclusion; it is a standard, universal exclusion in every fleet motor policy written in the UK market.
The exclusion exists because fleet motor insurers are pricing road traffic risk. The risk profile of an excavator digging a trench next to a gas main on a live construction site is categorically different from the risk of the same machine being driven on a low-loader to reach that site. The former is a construction liability risk; the latter is a transport risk. Different underwriters, different pricing models, different policy wordings.
The practical implication for your insurance programme is that you cannot rely on your fleet motor policy alone if you operate any form of plant. Your broker needs to map your vehicle activities against the correct policy types and ensure there are no gaps between your fleet motor and your fleet insurance and Contractors All Risk cover.
How fleet insurance and Contractors All Risk interact
Contractors All Risk (CAR) is a project-based policy that covers physical loss or damage to contract works, own plant and equipment, hired-in plant, and third party liability arising from construction operations. It is not a vehicle insurance policy and it does not replace fleet motor, but it overlaps with fleet motor in ways that require careful coordination.
The key areas of interaction are plant vehicles and public liability. When a tracked excavator causes damage while operating on site, the question of which policy responds depends on whether the vehicle was in transit (fleet motor) or working (CAR or TPWR endorsement). When a vehicle reverses into a site boundary wall and damages a third party’s property, the question is whether the vehicle was on a public road (fleet motor) or on private land (CAR public liability). These distinctions sound straightforward in theory; in practice, incidents happen in the grey zone between the two policies, and a claim can fall between them if the policies are not properly coordinated.
🔍 Broker insight
Where possible, place your fleet motor and Contractors All Risk with insurers whose wordings are written to work together without gaps. Some specialist construction insurers offer package policies that include both elements under a single contract, which eliminates the grey zone problem entirely. This approach typically produces better value than buying each element separately and is worth asking your broker about specifically.
Subcontractors’ vehicles and hired-in plant
Two vehicle categories cause consistent confusion on construction fleet policies: vehicles owned by subcontractors working on your sites, and vehicles hired-in by your business for project use.
Subcontractors’ vehicles
Your fleet policy covers only the vehicles that belong to your business or are formally declared to your insurer. A subcontractor’s van, truck, or plant is the subcontractor’s own responsibility to insure. It will not be covered by your fleet policy, and any damage to or caused by that vehicle falls to their insurer to deal with.
What you are responsible for as the principal contractor is verifying that subcontractors operating on your sites hold appropriate insurance before they start work. This is a duty of care obligation under HSE driving at work guidance and a standard requirement in most main contractor subcontractor agreements. In practice, this means requesting certificates of insurance as part of your subcontractor onboarding process and checking expiry dates at renewal.
⛔ Critical risk
Allowing a subcontractor to operate on your site without verifying their motor insurance is in force creates a direct liability exposure for your business. If an uninsured subcontractor causes injury or property damage on site, your public liability insurer will look closely at whether you fulfilled your duty to check. Always obtain certificates of insurance before any subcontractor vehicle or plant arrives on site, and diarise renewal dates to catch lapses mid-contract.
Hired-in plant and vehicles
Vehicles hired-in by your business, whether under a short-term daily hire or a longer contract hire arrangement, can be added to your fleet policy, but they must be declared. Many hire agreements include a clause requiring the hirer to hold comprehensive motor insurance covering the hired vehicle during the hire period; your fleet insurer needs to know the vehicle exists to provide that cover.
For plant hired under a contract that includes Hired-In Plant insurance on the hire company’s policy, clarify with your broker exactly which risks you are responsible for and which remain with the hire company. Duplication is less of a problem than gaps, and hired plant disputes at claim time are a well-known source of friction between construction businesses and their insurers.
CHAS, SafeContractor, and how accreditation affects your premium
CHAS (the Contractors Health and Safety Assessment Scheme) and SafeContractor are the two most widely recognised health and safety pre-qualification schemes in the UK construction sector. Both are SSIP (Safety Schemes in Procurement) members, meaning accreditation to one provides mutual recognition across other SSIP schemes, reducing duplicated assessment in the tender process.
From a fleet insurance perspective, CHAS or SafeContractor accreditation is not a direct premium discount mechanism; there is no standard tariff reduction for holding an SSIP certificate. However, accreditation serves as evidence of something that specialist construction fleet underwriters do care about: a formal, documented health and safety management system. Businesses that can demonstrate structured risk management are statistically better risks, and experienced construction fleet brokers know how to present this to underwriters in a way that translates into better pricing.
The premium benefit is most pronounced when CHAS or SafeContractor accreditation is presented alongside a clean claims record, documented driver licence checking, telematics data showing measured driving behaviour, and evidence of toolbox talks or driver safety training. No single factor moves a premium significantly on its own; the combination of all of them does.
📌 Key rule
CHAS and SafeContractor accreditation demonstrates a formal health and safety management system. It does not automatically reduce your fleet premium. The premium benefit comes from your broker presenting accreditation as part of a structured risk submission, alongside claims data, telematics evidence, and driver management records. Accreditation alone, presented without context, will rarely move the needle.
💡 Pro tip
If your business holds CHAS or SafeContractor accreditation, ensure your broker explicitly references this in the fleet submission document and provides supporting evidence. Underwriters reviewing a submission that simply lists vehicles and drivers will not go looking for accreditation status. You need to put it in front of them with the rest of your risk presentation.
What drives construction fleet premiums: how to reduce them
Construction fleets attract higher base premiums than equivalent non-construction commercial fleets for well-documented reasons: higher mileage, more adverse environments, higher average driver turnover, and a sector claims frequency that underwriters have measured over decades. Understanding the specific factors within your control is the starting point for managing costs.
Vehicle mix and vehicle age
A fleet dominated by high-value specialist vehicles, newer HGVs, modern plant carriers, tipper trucks with significant replacement values, will always attract a higher premium than an equivalent fleet of standard panel vans. However, older vehicles can also push costs up if they lack modern safety technology. Cameras and telematics fitted across the fleet are now treated as positive underwriting factors regardless of vehicle age, and fleet telematics consistently delivers 8–15% premium reductions for construction fleets at first renewal after fitting, with further improvement in subsequent years as data accumulates.
Site parking and overnight security
Construction vehicles parked overnight at live building sites are among the highest-risk assets for theft and vandalism claims. A transit van left outside a Canary Wharf office block at night carries very different theft risk to the same van left at an unlit construction site on the urban fringe. Insurers want to understand where your vehicles park overnight and what security measures are in place. If vehicles are parked at sites during active phases of a project, documenting the site security arrangements, fencing, lighting, CCTV, immobilisers, will support your underwriting submission.
Driver profile and turnover
Construction businesses typically have higher driver turnover than other industries, particularly those that rely on seasonal labour or subcontract trades. High turnover makes driver management harder and pushes insurers towards any driver cover with its associated premium loading. Where the workforce is stable enough to name drivers, named driver cover will almost always be cheaper. If seasonal workers or subcontract drivers are the norm, plan for the any driver loading in your budget and look at whether telematics can offset part of it.
Claims management and excess strategy
The single most effective lever for managing construction fleet premiums over the medium term is claims frequency. Frequent small claims, reversing damage, kerb strikes, minor scrapes, accumulate on the policy and drive renewal premiums up in the following year and beyond. Some construction businesses find that self-funding minor damage (effectively running with a high informal excess for cosmetic damage) and reserving their policy for significant claims produces a better three-year premium average than claiming every knock. This strategy needs to be costed properly against actual damage costs; your broker can help model the breakeven point. See our guide to reducing fleet insurance premiums for a full breakdown of this approach.
💼 Real example
A civil engineering contractor with 18 vehicles had a claims frequency of 7 incidents in year one, mostly minor reversing damage on site. At renewal the insurer applied a 34% premium increase. The contractor fitted rear-view cameras across the fleet, introduced a formal incident reporting process, and agreed to a higher excess. By year three, claims had dropped to 2. The premium recovered to below the original year-one figure despite additional vehicles being added. The camera investment paid for itself in the first renewal cycle alone.
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Construction fleet scenarios: who needs what
The right policy combination varies considerably by contractor type. These scenarios illustrate the most common configurations encountered in the construction sector.
What your insurer needs when you apply
Construction fleet submissions require more detail than standard fleet submissions, and incomplete information is the most common reason for inaccurate initial quotes that subsequently increase when full details are provided. Prepare the following before approaching brokers or comparison services.
Construction Fleet Submission Checklist
- ✓ Full vehicle schedule: make, model, year, registration, value, and primary use for every vehicle
- ✓ Accurate vehicle use classification: carriage of own goods, plant, tools of trade, supervisor use, mixed; be specific
- ✓ Driver schedule (if named driver): full name, licence number, years held, three-to-five year claims and conviction history for each driver
- ✓ Any driver age threshold (if any driver cover): minimum age to propose and whether DVLA licence check process is documented
- ✓ Claims history: five-year confirmed claims experience from your current insurer — see our fleet documents guide for how to request a loss run
- ✓ Overnight parking locations: addresses or site types where vehicles are stored or parked after hours
- ✓ Security measures: alarms, immobilisers, trackers, dash cams, site fencing/CCTV at parking locations
- ✓ CHAS, SafeContractor, or other SSIP accreditation certificates if held
- ✓ Description of hired-in plant or vehicles: frequency, typical values, hire agreement structure
- ✓ O licence number if operating goods vehicles over 3.5 tonnes; see gov.uk operator licence guidance
- ✓ Telematics data summary if fitted; 12 months of driving behaviour reports carry real weight at renewal
The more structured your submission, the stronger your position with underwriters. Construction is a sector where the quality of the risk presentation genuinely influences terms; underwriters who can see a professionally managed fleet will price more competitively than those presented with a bare vehicle list. Your broker should be building this submission for you; if they are not, consider whether a specialist fleet management approach and a different broker might produce better results.
HGVs, tipper trucks, and operator licences
If your construction fleet includes any goods vehicle over 3.5 tonnes gross vehicle weight, and most tipper trucks, flatbeds, and low loaders fall well above this threshold, you are operating under the terms of an operator licence (O licence). This has significant implications for both your fleet insurance and your legal compliance.
Fleet insurers underwriting HGVs will require confirmation of O licence status and may ask for your DVSA earned recognition status or OCRS (Operator Compliance Risk Score) if available. A poor OCRS score, reflecting a history of vehicle defects, driver hours infringements, or improvement notices, will be a negative underwriting factor. A clean compliance record demonstrably reduces fleet risk and, over time, premiums. Our HGV fleet insurance guide covers operator licence obligations, tachograph requirements, and the full range of cover considerations for goods vehicles in detail.
⚖️ Legal obligation
Operating a goods vehicle over 3.5 tonnes without a valid operator licence is a criminal offence under the Goods Vehicles (Licensing of Operators) Act 1995, carrying fines of up to £5,000 per vehicle. It also invalidates any fleet insurance policy written for those vehicles. If you are unsure whether your tipper trucks or flatbeds exceed the 3.5-tonne threshold, check the gross vehicle weight (GVW) on the vehicle registration document, not the kerb weight. Most site tippers are well above 7.5 tonnes GVW.
Frequently asked questions
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