Motor Fleet
To appreciate how introducing Risk Management techniques operate to reduce
the insurance costs of your fleet it may be useful to have a basic understanding
of how a fleet underwriter approaches the rating process.
Motor insurance is very statistical, in short underwriters will calculate
the average cost in terms of claims paid and outstanding over a three year
period against the average number of vehicles insured. To this figure they
will add a percentage to cover the cost of administration, commissions and
an element of profit. Insurers will also consider accident frequency against
the number of vehicles insured.
The main complaint when considering introducing Risk Management techniques
to control the number of accidents is that the rewards can take up to two
years to materialise in terms of a reduction in the insurance cost per vehicle.
Insurers require evidence that the procedures introduced are having an effect
on the claims frequency. But consider this. The cost of an accident is not
restricted to the ‘bent metal’ cost. The average cost of repairing
a damaged vehicle is £700. The true cost is between 4 and 32 times
this amount. That’s costing a minimum of £2,800!
In addition to experiencing a reduced accident frequency and in time companies
that operate a Risk Management programme experience:-
• Reduced wear and tear costs
• Less vehicle down time
• Better fuel efficiency
• Enhanced Company image
• Increased driver awareness of cause and effect
• Improved Health & Safety culture
Company Directors, managers and the nominated Health & Safety officers
are personally accountable for the risk and safety of all of their employees
by law. Yet the risks your driver faces on a daily basis is often overlooked.
A few facts to consider.
• 10 drivers die on Britain’s roads every day
• 30% of all serious road injuries and fatalities involve someone
driving
in connection with work
• 95% of all accidents are caused by human error
• A driver averaging 25,000 miles per annum has a similar risk of
occupational fatality as a coal miner or construction worker
In conclusion, every fleet is different and has its own problems. The key
to keeping costs down is controlling accidents and taking a proactive approach.
We can help manage this with you.
