In today’s world, vehicles play a vital role in both personal and business activities. Whether it is buying a new car, transporting a commercial fleet, or moving a vehicle from one location to another, having the right insurance coverage is essential. One such important yet lesser-known type of coverage is Driveaway Insurance. This type of insurance is especially useful for businesses and individuals who regularly move or deliver vehicles over long distances.
What is Driveaway Insurance?
Driveaway Insurance is a specialized type of motor insurance designed for companies or drivers involved in transporting vehicles from one place to another. Unlike standard auto insurance that covers a car owned and driven by an individual, insurance covers vehicles that are being delivered, relocated, or moved on behalf of customers or businesses.
For example:
- A dealership moving cars from the manufacturer to the showroom.
- A driver delivering a purchased car to the buyer’s home.
- A company relocating a fleet of vehicles across states.
In such cases, the driver does not own the vehicle but is responsible for transporting it safely. Insurance ensures that both the vehicle and the driver are protected during this journey.
Who Needs Driveaway Insurance?
Driveaway insurance is particularly important for:
- Car Dealerships – Moving vehicles from auctions, manufacturers, or between branches.
- Transport Companies – Businesses that specialize in delivering vehicles nationwide or internationally.
- Individual Drivers/Contractors – Professional drivers who transport vehicles for companies.
- Private Individuals – Someone who hires a driver to deliver their newly purchased or relocated car.
What Does Driveaway Insurance Cover?
The coverage of insurance can vary depending on the provider and policy. However, common protections include:
1. Third-Party Liability
Covers damages or injuries caused to other people, vehicles, or property during the driveaway process.
2. Collision Coverage
Pays for repairs or replacement if the transported vehicle is damaged in an accident while being driven.
3. Driver Protection
Some policies also include medical expenses and personal accident coverage for the driver.
4. Short-Term or Temporary Cover
Insurance is often flexible, offering daily, weekly, or monthly coverage, depending on the job.
Benefits of Driveaway Insurance
- Financial Protection – Covers high repair or replacement costs in case of accidents or damage.
- Peace of Mind – Both the vehicle owner and driver feel secure knowing that risks are covered.
- Business Security – Protects companies from liability claims and ensures smooth operations.
- Flexibility – Policies can be customized for single trips or long-term contracts.
- Legal Requirement – In many regions, liability insurance is mandatory for anyone driving vehicles they don’t own.
How Driveaway Insurance Works
The process of getting insurance is straightforward:
- Apply for Coverage – The driver or business provides details about the trip, the vehicle(s), and duration.
- Choose Policy Type – Select between short-term, annual, or fleet coverage.
- Premium Calculation – Costs depend on factors such as vehicle value, distance, type of transport, and driver history.
- Policy Activation – Once purchased, the policy covers the vehicle for the specified time or trip.
Cost of Driveaway Insurance
The cost of driveaway insurance depends on:
- Distance and route (longer routes carry higher risks).
- Driver’s age, license type, and driving history.
- Duration of coverage (short-term vs. annual policies).
On average, insurance is affordable for businesses and is often cheaper than traditional auto insurance since it is temporary and job-specific.
Difference Between Driveaway Insurance and Standard Auto Insurance
| Feature | Driveaway Insurance | Standard Auto Insurance |
|---|---|---|
| Ownership | For vehicles not owned by the driver | For owned vehicles |
| Duration | Short-term / Temporary | Long-term (annual) |
| Purpose | Delivery, transport, relocation | Daily personal or business use |
| Coverage Type | Flexible, per trip or per job | Ongoing, regular use |
Conclusion
Driveaway Insurance plays a crucial role in protecting vehicles, drivers, and businesses involved in vehicle transportation. It ensures that vehicles are covered during transit, reducing risks for both owners and delivery companies. Whether you are a car dealership moving stock, a professional driver delivering vehicles, or a transport business managing fleets, insurance provides essential peace of mind and financial protection.
In a world where vehicle mobility is increasing, investing in the right insurance, such as driveaway coverage, is not just an option but a necessity.