Lease Plan commercial director Steve Dunn said the average cost of incidents resulting in claims had dropped over the last couple of years. The typical cost of an incident for which Lease Plan handled dropped significantly between 1995 and 1996. VELO said more and more companies were looking at taking on a higher level of insurance risk, rather than relying on insurers to do it for them, and it was paying off for many firms.

Leading insurance companies, however, said many companies were better served by comprehensive cover. Eagle Star assistant commercial motor manager Ron Munro said the Lease Plan figures did not reflect the company's experience, which showed the average cost per claim had risen over the past year. However, Dial Assure general sales manager Sue Branston said: 'Brokers will say the market place is very soft, but in our experience if you have the right risk management control in place by opting for third party, which tends to be the trend for larger fleets anyway, you can control costs.'