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Fleet Management

What To Include In Your Company Vehicle Policy

Every business that owns and operates even one car, truck, or van needs a company vehicle policy. Learn what to include in yours for maximum benefits.

company vehicle policy

Regardless of the size or type of business you run — and the number of cars, trucks, or vans you own and operate — creating and enforcing a company vehicle policy pays dividends down the road.

In this article, we discuss why a company vehicle policy is so important and give you suggestions for what to include in yours.

Table Of Contents

Why A Company Vehicle Policy Is Important

company vehicle

A company vehicle policy (or CVP for short) is a set of rules, guidelines, and procedures that govern how employees use the cars, trucks, and vans in your commercial fleet.

Many first-time owners wonder, though, “Why do we need such a policy?” and, “Why are these guidelines so important?” Read on for the answers.

Protects Your Assets

You invest a lot in your fleet vehicles, and you want those assets in service for a long time. Implementing a CVP that encourages safe driving habits helps preserve both the appearance and the mechanical integrity of all your rolling stock.

Protects Your Drivers

A comprehensive company vehicle policy also protects the drivers who get behind the wheel every day. A dent, ding, or mechanical damage to a work truck can be fixed. But an injury of any kind to the driver can last a lifetime.

Enforcing the CVP helps reduce the risks associated with piloting a vehicle and helps prevent the types of injuries that can dramatically affect a person’s life.

Protects Your Business

Regardless of the CVP you put in place, accidents will likely occur. That’s just the nature of driving these days.

But negligence on the part of your business can make what happens after accidents much worse.

Without a company vehicle policy, damages, legal costs, and medical liability can skyrocket to the point that bankruptcy is the only option.

Protect your business — and everyone who works for you — by creating a CVP of your very own and training your employees to abide by it.

Pays Cultural Dividends

A strong company vehicle policy can even pay cultural dividends for everyone involved.

When your employees follow the rules and your business expresses concern for everyone’s safety, it creates a sense of camaraderie and strong bonds that results in happier team members and better work overall.

What To Include In A Company Vehicle Policy: Legal

company vehicle policy being signed

CVP Overview

Every company vehicle policy should start with an overview that outlines the basics of the document, including:

  • What qualifies as a company vehicle
  • To whom the policy applies
  • When the policy is in force
  • Where the policy is in force

The overview may even mention — but not go into detail on — the other parts of the CVP discussed below.

Driver Eligibility

A big part of any CVP is the section on driver eligibility.

There, your business can describe the process for gaining permission to drive a company vehicle, including steps such as:

  • Fill out the requisite paperwork
  • Submit a copy of a driver’s license
  • Allow the business to check your driving record

Be sure to include language that gives your business the right to assign and revoke access to company vehicles at its discretion and at any time.

Acceptable Use

A good CVP will also define acceptable use for each car, truck, SUV, and semi in the fleet.

No two businesses are the same, so the way you define acceptable use may not be the same as someone else defines acceptable use. If you base your CVP on a template of some kind, be sure to alter the use section so that it fits the way your business operates.

Company Responsibilities

Man driving a company vehicle

Another important section of a CVP is the responsibilities that your business accepts when it fields a fleet of commercial vehicles.

These often include:

  • Providing insurance
  • Registering the vehicles
  • Scheduling regular maintenance
  • Ensuring business vehicles are safe
  • Acquiring/retiring vehicles as needed

It’s also a good idea to include language that indicates what the business is not responsible for, including, for example, paying fines that drivers receive and posting bail for drivers who are arrested while driving company vehicles.

Penalty For Violation

Every company vehicle policy needs to, at least, mention the penalty for violation of said guidelines.

Most often, this is a revocation of the employee’s right to drive fleet assets but may also include fines and other sanctions if the violation is serious enough.

What To Include In A Company Vehicle Policy: Procedural

street light

Accident Procedures

In this section of your CVP, set clear protocols that all employees must abide by should an accident occur.

This usually involves contacting the employee’s immediate supervisor and what documentation to provide to authorities upon request. You may also define who covers any damages, fines, and legal costs that result from the accident.

Rules

1) Conduct Pre-Trip And Post-Trip Inspections

The Department Of Transportation (DOT) requires that all fleet drivers conduct a pre-trip inspection of the vehicle before getting underway. Doing so ensures that the vehicle is in good working order and is safe to operate.

Post-trip inspections aren’t required by law but are a good idea for tracking damage and wear and tear on company vehicles.

2) Obey All Laws

Including a section that makes it plain that drivers must obey all laws helps protect them and the business — both physically and legally — should an accident occur.

Among other things, this part of your CVP can mention:

  • Observing the posted seat belt
  • Wearing a seat belt at all times
  • Obeying all traffic signs and stop lights

This section is also a good place to outline the penalties for breaking the law while in a company vehicle.

3) Document Driving Expenses

Fleet vehicles that travel across state lines and into Canada must abide by the International Fuel Tax Agreement (IFTA).

Remaining in compliance means tracking fuel expenses along the way so that fleet managers can forward the necessary funds to the proper authorities.

If your business also agrees to pay for other trip expenses — food, lodging, supplies, and repairs — make sure that drivers understand that they need to document these purchases and provide receipts.

4) Track Mileage

car speedometer

Sometimes, tracking mileage is included as part of the pre-trip and post-trip inspections. If it’s not, and your business needs these numbers, set up a process that drivers can use to record the beginning and ending mileage of their trip.

The simplest option is a paper form or record book that stays in each vehicle, although other options include mileage-tracking apps and data from telematics.

5) Monitor Systems While Underway

Another good rule to include in your CVP is one that requires drivers to monitor systems while underway.

Most drivers will pay attention to fuel levels while they’re on the road, but encourage them to also check fluid levels — e.g., oil, transmission, and windshield wiper — as well as tire pressure once or twice throughout the work day.

Doing so can prevent a small problem from becoming a big (and expensive) issue.

6) Report Damage Immediately

Make it mandatory that all drivers report damage to the home office immediately.

Most minor cosmetic damage from regular use gets reported on the pre-trip and post-trip inspections, but if a driver notices that the vehicle has been scratched while parked in a parking lot, for example, they should contact their manager to report it.

Establishing such a procedure in your CVP makes it easier to track driver behavior and stay on top of maintenance and repair issues.

7) Do Not Drive While Impaired

This rule should be as specific as possible and include language that refers to all types of impairment, including those caused by:

  • Illicit drug use
  • Alcohol use
  • Prescription drug use
  • Fatigue

Also, establish the penalties inherent in breaking this part of the CVP.

8) Do Not Use A Phone While Driving

company vehicle policy on hands free driving

The dangers of texting and talking on the phone are well-established. Ohio has even gone so far as to make initiating phone calls and answering texts illegal while a vehicle is in motion.

Include a rule that explicitly prohibits drivers from using their cell phone while operating fleet vehicles.

9) Do Not Smoke In Any Company Vehicle

Smoking while driving can be just as dangerous as using a cell phone. In addition, the smoke can permeate the cab and seriously reduce the resale value of the vehicle.

Make it clear that smoking in company vehicles is strictly prohibited.

10) Do Not Allow Unauthorized Drivers To Use Company Vehicles

Most CVPs and insurance policies only cover drivers that are employed by the business.

If an unauthorized driver hops behind the wheel — except in certain emergencies — it can pose serious legal risks.

Help For Fleet And Fuel Management

Help For Fleet And Fuel Management

One of the best ways to enhance your company vehicle policy — and reduce business expenses in the process — is to include fuel management procedures as part of your driver training.

The Coast fleet and fuel card can help.

With a Coast card, you can set policies that help streamline fuel management procedures. Coast also provides real-time expense tracking and a powerful online management platform that puts your entire fleet in the palm of your hand and provides full visibility of every dollar spent.

For more information, visit CoastPay.com today.