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Reading: Rising insurance costs inside M25 ‘stifling small operators’ growth’
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routeone > News > Rising insurance costs inside M25 ‘stifling small operators’ growth’
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Rising insurance costs inside M25 ‘stifling small operators’ growth’

Tim Deakin
Tim Deakin
Published: August 19, 2024
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Rising insurance costs for coaches and minicoaches based within the M25 are constraining the ability of small operators there to expand, such a business has said.

That worry has been aired by A to Z Minicoaches of East London. It bought a 19-seat Mercedes-Benz Sprinter to grow its fleet to three. Upon attempting to insure it, Director Aziz Aissa was quoted £14,000 for that minicoach alone via a broker.

Despite the vehicle having cost £120,000, it has now been sold because of being unable to secure a realistically priced policy for it. The minicoach was equipped with CCTV and a tracking device.

Quotes sat against a three named driver restriction. The broker informed A to Z that its location within the M25 is the primary reason for high figures, although Mr Aissa attaches no blame to the party giving that advice. The operating centre is secure and protected by security doors, alarms, and CCTV.

In addition, A to Z was told that its small size means that it is not classified as a fleet by some insurers, compounding the insurance difficulty.

“That left me with no choice but to sell the vehicle as the insurance was unaffordable,” says Mr Aissa. The operator currently pays £6,500 to insure two lower value minicoaches. It is now considering buying a further 16-seat Ford Transit, which can be added to an existing policy.

Mr Aissa says the approach to higher value vehicles within the M25 from large insurers “is making it increasingly difficult for small operators like me to grow,” adding that “the situation is compounded by the fact that, despite all the measures we take to ensure our vehicles are safe, insurance companies continue to raise premiums to prohibitive levels.”

He continues: “It is disheartening that unless you are a large operator, these insurance companies are unwilling to provide reasonable terms, effectively stifling growth and innovation in the industry.”

No clarification was received from insurance companies on why the operator is not classified as a fleet for coverage purposes, although A to Z has been informed by its broker that most insurers regard five vehicles as the minimum for that categorisation.

Mr Aissa believes that prohibitive insurance costs “deserve attention and discussion within our community” and he expects that other operators within the M25 will be facing similar issues.

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ByTim Deakin
Tim is Editor of routeone and has worked in both the coach and bus and haulage industries.
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