With rising insurance premiums, successfully managing fleet risk should be a top priority as we enter a new year.
The Occupational Safety and Health Administration (OSHA) stated that most road related fatalities occur on highways where there are seat belt requirements and traffic laws, between the hours of 7 a.m. and 4 p.m. Additionally, the U.S. Department of Transportation National Highway Traffic Safety Administration (NHTSA) 2020 annual traffic crash data reported over 38,000 fatalities related to U.S. traffic crashes, and this creates a serious conundrum for insured and insurers alike.
Payouts related to vehicle repair or replacement, medical treatment, litigation and the impact of nuclear verdicts on companies have contributed to rising costs.
As a result, carriers are scrambling to do anything in their power to manage rising cost, and rightly so. But as the saying goes, change must start within. By looking at your fleet risk profile you may be able to identify areas where you can have a positive impact on your driving risk.
Managing Fleet Risk
Consider collaborating with an Insurance Risk Consultant who can tailor a plan to your specific business model. At INSURICA we call this our RM4U process, and managing fleet risk is a part of that strategic plan.
Prior to winter setting in organizations should review their fleet program. From a basic risk control level, it is a good idea to prepare your staff for the changing road conditions.
Companies should always have a strong driving policy. Make it practical. The policy should address things such as fatigue, load securement, maintenance, and technology use. Here is a great example advocating for a well thought out policy.
During my time in a safety leadership position for an energy company we identified that we were having a high frequency of backing accidents. After our policy update we instituted a first move-forward rule, and it had almost immediate success. The backing incidents were reduced drastically lowering or vehicle claim frequency.
Companies should ensure they are educating their employees on good driving techniques. The important thing to remember is to make it relevant. Company leaders should ensure a system is in place to address behaviors and show a commitment to company expectations.
There are many other items that would need to be considered such as running motor vehicle reports on drivers, creating a recognition program, developing a robust accident investigation process, or considering the use of telematic technology. Again, I cannot stress enough that making the program specific to your business is paramount.
Benefits of Telematics
Many businesses have started to equip vehicles with devices known as telematics. These devices can help reduce numerous fleet risks, improve efficiency and promote safe driving behaviors.
Common data collected by vehicle telematics software includes:
- Vehicle speeds
- Vehicle locations
- Diagnostics data related to fuel efficiency and vehicle performance
- Driving behaviors (e.g., braking intensity or acceleration frequency)
- Vehicle weights
- Movement patterns of a vehicle
- Distracted driving incidents (e.g., smartphone usage)
Telematics can be used in a variety of different commercial vehicles, tractor-trailers and heavy equipment. Many employers use this technology to monitor vehicle deliveries, determine routes, communicate with drivers, review employee driving practices and detect vehicle maintenance concerns.
What works for another company or business may not be a good fit for your organization. Consulting a professional can help make this process less stressful and will give you an opportunity to get some fresh eyes on your risk. For more ways to manage your fleet, contact INSURICA today.
This is not intended to be exhaustive nor should any discussion or opinions be construed as legal advice. Readers should contact legal counsel or an insurance professional for appropriate advice.