HGV trade insurance is mandatory by law and should be had by every driver who drives a Heavy Goods Vehicle (HGV). But the coverage can vary, and this is where you'll see a difference in costs.

The law mandates that your coverage should include third-party liability, which means any injury or damage to another person caused by your vehicle will be covered. This is to ensure that the injured person gets compensation from the accident, of course, provided that it is caused by you.

Besides this mandatory coverage, it is financial prudence to have a wider coverage that will cover the cost of damage to your driver and vehicle as well. Other than these two coverage types, there are also many add-ons that you can choose to have depending on the needs of your business.

What you choose and how much of coverage you take will determine the cost of your HGV trade insurance.

Some of the other factors that also have an impact on the overall cost are:

Value of your truck

The value of your truck will determine how expensive the repair charges will be, and in turn, your insurance premium for the same. It can also be calculated as the rate at which your truck will be sold if you were to sell it today.

Remember never to under-value your truck because your insurance provider may choose to reject your claim on this ground.

Age

A related aspect is the age of your vehicle. Insurance for a new truck will cost you less than an old one simply because the cost of repair will be much lower. For example, the possibility for a brand new truck to break down is much lesser than a truck that's about eight years old. This is why new lorries cost a lot less for insurance.

Nature of goods

Another factor that determines your cost is the nature of goods that you plan to carry in your lorry.That is, of course, if you have insurance to cover the contents of your lorry.

If you choose just to do basic insurance, obviously this doesn't come into the picture at all. But doing so would be suicidal in the event of an accident as you'll have to repay the entire cost of the goods to the owner.

On the other hand, if you choose to ensure the contents, the value of the goods will have a bearing on the cost. If you carry low-cost items like gravel, the insurance cost will be less when compared to high-value items like oil.

Location

The final destination also impacts the cost of your insurance. If you're likely to travel within your country alone, then the cost of insurance will be less. But if you plan to travel to international locations, the cost of insurance will go up.

Regardless of which of these options you choose, you need a provider like Total Insurance that takes into account what you want, will compare across different services and will give you the best possible rate.