Commercial Car Insurance: Costs & Benefits

Commercial motor insurance for own goods carriage and general cartage, comprehensive and third party only including personal accident cover, goods in transit and other addons

Car insurance is a mandatory requirement for all vehicles to operate on the road in Kenya as mandated by the Kenyan law CAP 405.There are 3 main classes of classes – private, commercial and passenger service vehicles (PSV). In this article, we take a look into commercial vehicle insurance cover both Third Party Only (TPO) and comprehensive insurance. The total premiums for car insurance for 2017 totalled to KSh 36 Billions and commercial vehicle insurance premiums accounted for KSh 23.2 Billions of that. Let’s look at the two types of vehicle classes under the commercial category and find out the insurance covers offered.

Own Goods Carriage

This is the most common class of commercial vehicles on the road. These are typically pickups, lorries and other small trucks that are owned by the insured for the transportation of the insured’s own goods.

Comprehensive Insurance

This will cover the motor vehicle insured from all risks including accidental and malicious damage, fire, theft, natural hazards like storms, flooding, earthquake, thunder, riots and civil commotion. It is charged at a rate of 4% of the value of the insured vehicle subject to a minimum premium of KSh 20,000 – 25,000.

In addition, there are two popular options recommended with this cover:

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Excess protector for Own Damage

This is very popular for all classes of comprehensive motor insurance. In case of an accident to the insured vehicle, an excess of 5% of the vehicle value applies subject to a minimum of KSh 20,000. This means the insured has to contribute towards the cost of repairs. Check out our article on how excess protector works to get a more detailed understanding.

This add-on therefore protects the insured against these expenses provided the total repair costs are above the minimum excess amount.

The excess protector for own damage option is charged at 0.25% of the value of the car subject to a minimum premium of KSh 2,500.

Political Violence and Terrorism

Damage or loss from any event of a political violence or terrorism (PVT) nature is a complete exclusion in most insurance policies worldwide. The PVT is a standalone add-on to be added to an existing policy. For commercial comprehensive car insurance in Kenya, it is charged at a rate of 0.25% of the value of the vehicle subject to a minimum of KSh 2,500.

Third Party Only

This is the most affordable cover for this class of vehicles and is also the minimum insurance requirement for vehicles to operate on the road in Kenya. It covers third party property damages and bodily injuries. It is important to remember that it does not cover damage, loss and theft of the insured vehicle. It is charged based on the tonnage of the insured vehicle. The below table gives typical rates charged for this Third Party Only cover.


Tonnage Basic Premium (KSh)
0-3 7,500
4-8 12,000
9-10 18,000
11-20 20,000
21-30 25,000

The below table also shows the coverage on a typical insurance policy with the liabilities covered and their respective limits.

Benefit/Liability Limit (KSh)
Emergency medical expenses 30,000
Third Party Property Damage 20,000,000
Third Party bodily injury per event Unlimited
Passenger Liability – per person 4,000,000
Passenger Liability – per year 20,000,000
General Cartage Vehicles

From the coverage for the own goods carriage vehicles in the above section, the policy for general cartage is very similar. This is commonly taken by transport companies that offer their services for reward. Some of the popular transport companies include DHL, Multiple Hauliers, etc.

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Comprehensive Insurance

This is charged at a rate of about 4.5% of the value of the vehicle subject to a minimum premium of KSh 25,000. This rate applies for a single vehicle, most customers have a fleet of vehicles and they are likely to enjoy additional discount on the price. The other recommended add-ons like the excess protector for own damage and the political violence and terrorism cover are charged at a rate of 0.3-0.5% of the value of the vehicle

Third Party Only Insurance

This is more common than the comprehensive insurance for this class of vehicles. This is because the insured vehicles are large trucks, lorries and trailers. In case of an accident on the road, they don’t suffer much damage due to their big size and robust construction and body. Instead it is other vehicles on the road that suffer damage. For this reason, owners of these general cartage vehicles prefer to take out third party only insurance instead of the comprehensive cover which is also much more expensive. The price for this cover starts at KSh 12,500 per annum from most insurers subject to fleet size.

Personal Accident Insurance cover

This is another common add-on for commercial insurance policies in Kenya. It is a life insurance policy that covers death, Permanent Total Disability (PTD), Temporary Total Disability (TTD), Emergency medical expenses in case of accident for one driver and one loader for events suffered in the course of duty. Limits can be all the way up to KSh 500,000 but various options are also available from as low as KSh 100,000. This is a very affordable cover starting at KSh 1,000 per annum per person covered.

Loss of Income / Loan repayment

This is an extra add-on that is common with insurance for commercial vehicles. In the event that the insured vehicle is involved in an accident, it may be off the road in the garage for some time. Most of the vehicles on this category are financed by loans from banks and other financial institutions. Therefore this add-on helps the insured to continue repaying the bank loans as the vehicle is being worked on in the garage. Many insurance companies give up a maximum of 3 monthly repayments to be covered, which allows ample time for the vehicle to be repaired and back on the road earning.

Goods In Transit (GIT) Insurance

This GIT policy offers protection against loss, destruction, or damage to goods whilst they are in transit – from the time of leaving the insured’s premises to final delivery point. This is common with clients who possess vehicles that they use to ferry their goods from premises to customer locations or branch to branch for example.

The policy also protects the insured from liability during loading and unloading of the goods, and temporary housing in the course of transit.

Carrier’s Liability Insurance

This is a common add-on used mainly by transporter companies who do general cartage on behalf of clients.

This policy covers and indemnifies a carrier against their legal liability for actual and physical loss of or damage to goods or merchandise directly caused by fire and or accident to the insured vehicle whilst such goods or merchandise are actually transported in the said vehicle on condition that:

– Fire or accident has arisen
– Such damage or loss has been caused due to negligence or criminal acts of the insured’s servants.
– Vehicle is damaged by fire or explosion or accident.
– That a claim in respect of the motor vehicle thereof is admitted under motor comprehensive insurance policy covering the vehicle.

The rate charged for this is normally an average of 0.35% of the value of the goods being carried.


If you are shopping around for a motor insurance for your commercial vehicle or fleet, it is wise to compare quotes from multiple insurers in the market to get a good deal. Compare up to 10 quotes online and save up to 30% on your premiums, visit

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