Fleets need to take a holistic view of telematics data in order to implement long-lasting and effective risk management policies.

Experts at the Insurance Telematics Europe conference in London said that companies who lay the blame for poor driving solely at the door of their drivers could be missing the root cause of the problem, for example the driver’s manager or the general business culture.

For telematics to help deliver a successful risk management solution, it has to be used alongside a range of other measures.

“Telematics is a great medicine, but it’s not the magical cure,” said Steve Stock, head of motor underwriting at Zurich.

“What it needs to be allied with are robust, tried and tested risk management policies and procedures, along with some in-vehicle immediacy.”

Insurance companies like Zurich and Aviva have recognised telematics can help drive down risk. But, while in the past the business model would have seen insurers collecting the data, today it is simply based on recognising and encouraging a fleet’s use of the technology.

Focus on driver safety as part of whole solution

Martin Otter, insurance development manager at Trimble, which is one of Zurich’s telematics partners, believes driver safety is one part of a comprehensive solution rather than a means to an end in its own right.

And Andrew Price, European motor practice leader at Zurich, told delegates, that what is needed from fleets is a “holistic approach”.

He said: “The first and fundamental part of any risk management programme is to assess, analyse and understand the risks.”

There are four areas of risk associated with fleets, according to Price:

• Organisational risk – the risks that arise out of an operation’s everyday practice and procedures
• Driving risk – risks which have already resulted in a collision and require analysis
• Theoretical risk – that the driver will be involved in an accident at some stage, which requires a risk profile of the driver, the journeys they’re making and the vehicle they’re driving
• Dynamic risk – how a vehicle is being driven at any given time.

When it comes to organisational risk, Price stresses that it’s not just what fleet safety policies and procedures are in place, but how they dovetail into operating practices and procedures.

“Often you need to change the way a fleet operates to allow a driver to drive safely, rather than just having a fantastic fleet safety policy,” he said.

“That’s the fundamental part because that creates an environment in which drivers can drive safely.”

The danger is that if a fleet focuses its attention on using telemetics to identify drivers’ training needs, but the environment in which they are driving is still unsafe, there will still be collisions.

It’s therefore about putting control measures in place, but Price warns that fleets need to avoid using the telemetry data to blame the driver.

“A harsh braking event could be down to the driver being a bad driver, or it could be they are displaying these behaviours because their manager is putting undue pressure on them to make some sort of business objective,” he said.

“To assume that a poor outcome from a risk assessment, a collision or bad behaviour when driving is down to the driver, is missing a trick because there could be another root cause.”

For example, Price says that when he has analysed the data of larger fleets that has been split between departments, a trend sometimes develops where a whole department appears to have bad drivers.

“The truth is it’s probably the manager that is bad,” he added.

The business as a whole has to buy-in to the risk management approach, while maintaining, monitoring and reviewing its effectiveness.

“When you develop that culture, any training you do is much more likely to be effective,” said Price.

“I would never recommend somebody just put telemetry into the first risk management intervention and then do some driver training, whether that’s e-learning or in-vehicle.

“It is unlikely to be effective and in the long run will be a waste of money.”

Embed safety culture first

That sort of driver development should take place “further down the line” when the safety culture is embedded, according to Price.

He added: “There has got to be the leadership, the ownership and the management commitment to be successful.

“When those things are in place we can work with the customer to help address their total cost of risk, but if that safety culture is not there it’s not going to work.”