How Much Does Commercial Motor Insurance Cost?

Commercial motor and fleet insurance in Australia may start from around $1,200 to $2,500 per vehicle per year for lower-risk business cars and utes. Delivery vehicles, trade vehicles, heavy vehicles and fleets can cost more, often from around $2,500 to $10,000+ per vehicle per year, depending on use, drivers, claims history and cover selected. These figures are indicative only. Your actual premium may vary by insurer, vehicle, postcode, driver profile, claims history, excess and policy wording.

If you are asking how much commercial motor insurance costs in Australia, the short answer is that it depends on the vehicle and the risk attached to it. Your premium is shaped by what the vehicle is worth, how it is used, who drives it, where it is kept overnight, your claims history, the cover level you choose and the excess you set. For an overview of what the policy covers, see our guide to what commercial motor insurance covers. For a broader look at the product, see our commercial motor and fleet insurance guide.

At a glance

• Lower-risk business cars and utes: from around $1,200 to $2,500 per vehicle per year
• Delivery, courier and high-kilometre vehicles usually cost more because they spend more time on the road
• Heavy vehicles and specialist machinery can exceed $10,000 per vehicle per year
• Fleets are priced on the vehicles, drivers, use, claims history and risk controls
• A higher excess can reduce the annual premium but increases your cost at claim time
• The only accurate way to price cover is to quote against your actual vehicles and business use

Commercial motor insurance cost by vehicle type

These ranges are indicative only and should be treated as budgeting guidance, not a quote. The same vehicle can fall into different price bands depending on how it is used. A van used for occasional client visits is different from a van used for daily courier deliveries.

Commercial motor insurance cost by business type

Business type matters because it changes road exposure. A consultant drives to meetings a few times a week. A courier is on the road all day. A landscaper tows trailers and parks at worksites. Insurers price those risks differently, so ranges overlap.

Why are premiums rising?

If your commercial motor premium has increased at renewal, several market-wide factors are contributing. Vehicle repair costs have risen across the board. Newer vehicles fitted with advanced driver-assistance systems (ADAS) such as lane-keep assist, autonomous emergency braking and parking sensors require specialist calibration after even minor panel damage. A small bump can be more expensive to fix on a newer vehicle if cameras and sensors need recalibrating. Electric vehicles face similar pressures: battery damage, high-voltage componentry and limited specialist repairers can push repair costs higher.

Beyond repair costs, the broader insurance market has been affected by weather-related claims, particularly hail, storm and flood events across parts of Australia in recent years. Insurers spread the cost of these events across their book, which means premiums may increase even for businesses that have not made a claim. Parts supply chain delays and rising labour costs for qualified panel technicians have also played a role.

None of this means your premium is fixed. The sections below explain what you can influence.

What drives your premium up or down?

Factors that may increase your premium:

• Higher-value or newer vehicles with expensive parts and sensors
• Courier, delivery, rideshare or other high-kilometre use
• Young or inexperienced drivers, particularly under 25
• Whether the policy restricts drivers to named individuals, applies age restrictions, or allows any licensed driver is allowed
• Postcodes with higher theft or accident rates
• Poor claims history or a high loss ratio at renewal
• Vehicles parked on the street overnight rather than in a secure location

Factors that may reduce your premium:

• Secure overnight parking such as a locked garage, fenced yard or monitored depot
• Clean claims history across the fleet
• GPS tracking, dash cams or telematics systems
• A higher excess (more on this below)
• Grouping vehicles under one fleet policy where the insurer offers a discount
• Documented driver training and vehicle maintenance programs
• Choosing third party cover instead of comprehensive for older, lower-value vehicles

How cover level and valuation affect cost

The level of cover you choose has the biggest effect on your premium after vehicle value and use.

• Comprehensive: broadest cover, highest premium. May cover your vehicle plus third-party damage from collisions, theft, fire, storm and hail. Comprehensive may cost two to three times more than third party property damage for the same vehicle, though the gap varies by insurer.
• Third party fire and theft: mid-range. Covers third-party property damage plus theft and fire for your vehicle. Does not cover collision or storm damage to your own vehicle.
• Third party property damage: often the lower-cost option. Covers damage you cause to someone else's vehicle or property. Does not cover your own vehicle. Often suits older vehicles where the market value is low.

For a full breakdown of what each level covers, see our coverage guide.

Agreed value vs market value also affects your premium. Agreed value means you and the insurer set the vehicle's insured amount when the policy starts, and that's what you receive if the vehicle is a total loss. It costs more in premium but gives certainty. Market value means the insurer pays what the vehicle was worth at the time of the loss, which may be less than you expected. It costs less in premium but the payout is not locked in.

Choosing the cheapest premium is not always the lowest-cost decision. If the vehicle is essential to your work, saving on premium may not help if you cannot afford to repair or replace it after an at-fault accident.

How excess affects your premium

Excess is the amount you pay out of pocket when you make a claim. A higher excess usually means a lower annual premium. A lower excess means less cost at claim time, but a higher premium throughout the year. A business with three vehicles and frequent small claims may prefer a lower excess. A business with a clean claims history and strong cash flow may choose a higher excess to reduce annual costs. The right balance depends on how often you expect to claim and how much cash you can set aside per incident.

Some policies also apply additional excesses for younger drivers, inexperienced drivers or specific vehicle types. Check the policy schedule for any age-based or vehicle-based excess conditions.

Does fleet insurance cost less per vehicle?

Sometimes. Insuring multiple vehicles under one fleet policy can reduce administration costs and may attract a discount compared with separate individual policies. Fleet policies also mean one renewal date and one set of documents.

However, the per-vehicle premium still depends on the same factors: vehicle type, value, use, drivers, location and claims history. A fleet of high-risk courier vans will still cost more per vehicle than a fleet of low-kilometre sedans, regardless of any fleet discount. The biggest benefit for small fleets may be simpler administration rather than a lower premium for every vehicle.

Insurers generally define fleets starting from two to five vehicles, depending on the provider. Larger fleets with 15 or more vehicles may be rated based on the business's own claims experience and risk management practices rather than standard market rates.

Why the cheapest quote may not be the right fit

The lowest premium can look attractive, but it may come with a higher excess, narrower declared vehicle use, lower sub-limits or fewer optional extras. If your vehicle is essential to earning income, check what happens after an accident, theft or breakdown before choosing on price alone.

Before settling on a quote, compare:

• The cover level (comprehensive, TPF&T or TPPD)
• The excess and any age-based or vehicle-based excess loadings
• Listed drivers and any restrictions
• Declared vehicle use and whether your actual activities are covered
• Hire car or downtime options
• Whether tools, trailers or goods are included or excluded
• Claims service and repair arrangements

How to reduce your commercial motor insurance cost

These steps may help reduce risk and make your business easier to underwrite, but they do not guarantee a lower premium. For most businesses, the highest-return steps are securing overnight parking, maintaining a clean claims record, and choosing the right excess.

• Declare vehicle use accurately so the policy matches the actual risk
• List correct driver details and disclose any relevant claims history
• Keep vehicles in secure overnight parking where possible
• Maintain vehicles to a documented schedule
• Fit dash cams, GPS trackers or telematics if your insurer recognises them
• Review fleet size and cover levels at each renewal rather than auto-renewing
• Consolidate vehicles under a fleet policy if the numbers support it
• Remove vehicles no longer in use from the policy
• Keep records of driver training, maintenance and incident reviews so you can show insurers how risk is managed
• For older, lower-value vehicles, consider third party cover instead of comprehensive

How to get an accurate quote

Indicative ranges can only take you so far. The more accurate your details, the more accurate your quote, and the less likely you are to face problems at claim time because the vehicle use or driver details were wrong. To get a quote based on your actual business, have these ready:

• Business name and ABN
• Vehicle make, model, year and insured value for each vehicle
• How each vehicle is used (client visits, deliveries, site work, haulage)
• Whether vehicles are owned, financed, leased or employee-owned
• Usual overnight parking location
• Annual kilometres per vehicle
• Driver ages, licence types and claims history
• Preferred cover level (comprehensive, third party fire and theft, or third party property damage)
• Preferred excess
• Whether you want agreed value or market value
• Any optional extras such as hire car, tools of trade, windscreen or trailer cover

Get a quote for commercial motor and fleet insurance

How upcover can help

upcover arranges commercial motor and fleet insurance for Australian businesses using cars, utes, vans, trucks and fleets for work. upcover can help you compare options based on your vehicle type, business use, driver profile, fleet size, preferred excess and cover level, so you can move from broad price ranges to quotes based on your actual risk.

• 70,000+ businesses covered across Australia
• 4.9/5 customer rating
• 80+ insurance partners
• Instant Certificate of Currency on policy confirmation

upcover Pty Ltd ABN 17 628 197 437 is a Corporate Authorised Representative (CAR 1299211) of Experience Insurance Services Pty Ltd ABN 41 657 596 506, AFSL 539078.

Frequently asked questions

How much does commercial motor insurance cost in Australia?

Commercial motor insurance may start from around $1,200 to $2,500 per vehicle per year for lower-risk business cars and utes. Higher-risk vehicles such as delivery vans, trade vehicles and heavy trucks can cost from around $2,500 to $10,000+ per vehicle per year. These are indicative ranges and your actual premium will depend on your circumstances.

Why has my commercial motor insurance premium gone up?

Premiums across the Australian market have been rising due to increasing vehicle repair costs, the complexity of repairing newer vehicles with ADAS sensors, EV-specific repair expenses, weather event claims and rising reinsurance costs. Even businesses with clean claims records may see increases because insurers spread market-wide cost pressures across their book.

Is fleet insurance cheaper than insuring vehicles separately?

It can be. Insuring multiple vehicles under one fleet policy may attract a discount and offer simpler administration compared with separate policies. The per-vehicle cost still depends on each vehicle's risk profile, so the saving varies.

Does the type of vehicle affect the premium?

Yes. A sedan used for client visits is generally less expensive to insure than a heavy truck used for haulage. Vehicle value, repair costs, intended use and exposure to theft or damage all influence the premium.

Does adding tools cover increase the cost?

Usually, yes. Tools of trade cover is typically an optional extension or a separate tools of trade policy. The additional cost depends on the value of tools declared and the security arrangements in place.

How does excess affect commercial motor insurance cost?

A higher excess can reduce the annual premium, but it increases what you pay if you claim. The right setting depends on your cash flow and claim frequency.

Does claims history affect my premium?

Yes. Claims history is one of the strongest factors at renewal. A business with frequent or high-value claims will typically pay more than one with a clean record. For fleets, the overall loss ratio across all vehicles influences pricing.

Can I reduce my commercial motor insurance premium?

The highest-impact steps for most businesses are secure overnight parking, maintaining a clean claims record, and choosing the right excess for your cash flow. Accurate use disclosure, driver training, telematics and reviewing cover levels at renewal can also help over time. These steps do not guarantee a lower premium.

Does comprehensive cost more than third party?

Yes. Comprehensive is the broadest level of cover and may cost two to three times more than third party property damage for the same vehicle. Third party fire and theft sits in between. The right level depends on the vehicle's value and how much risk your business is prepared to carry.

Is CTP included in commercial motor insurance?

No. CTP is arranged separately through state or territory registration schemes and covers personal injury liability. Commercial motor insurance covers vehicle damage and third-party property damage, depending on the policy. They are separate products.

Can I insure one business vehicle under commercial motor insurance?

Yes. Commercial motor insurance can apply to a single business vehicle as well as a fleet, depending on insurer acceptance. You do not need multiple vehicles to arrange commercial motor cover.

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_{The information in this article has been prepared without taking into account your individual needs, objectives or financial situation. It should not be relied upon as personal advice. All insurance products arranged through upcover are subject to the terms, conditions, limits and exclusions contained in the relevant policy wording and Product Disclosure Statement. Before deciding whether a particular insurance product is right for you, please read the relevant PDS and consider your personal circumstances. upcover Pty Ltd ABN 17 628 197 437 is a Corporate Authorised Representative (CAR 1299211) of Experience Insurance Services Pty Ltd ABN 41 657 596 506, AFSL 539078. upcover arranges insurance products with selected insurers and underwriters and does not compare all general insurers or insurance products available in the market.}