'A fleet manager who previously used to work on construction sites once described how the local project manager would overcome obstacles during construction, such as pipes and cables, by simply cutting through them.
He said it was cheaper to pay the £250 excess on the insurance claim from the council or utility company, than re-routing the whole construction project as the insurance company would pay the rest of the claim.
The same principle applies to fleet insurance claims. Fleet managers are now all too aware of the direct link between claims and future premiums, which is why there has been a 'call to arms' to keep down insurance costs.
One solution has been to charge employees if they have accidents to reduce the number of damaging claims. On this principle, the construction project manager would be forced to pay the total cost of claims from his budget.
The general school of thought is that this measure will have a significant impact on the fleet manager as well – and bonuses for their staff. This creates a clear focus on managing accidents and associated costs. But, as always, there are two sides to every coin.
Although penalising drivers can lead to increased responsibility behind the wheel, any noticeable impact will be lost if a company fails to implement a wide-ranging risk management and safety initiative. Many of the drivers responsible for accidents are highly paid, high mileage drivers and a small penalty is a mere drop in the financial ocean, which will rarely change driving habits. Then there is the problem of how to manage a fining policy. A fixed penalty could never be fair given that cars don't have the same accident costs. For example, a Mercedes C-class needing a new front wing would have different costs to a Ford Mondeo requiring similar repairs.
The alternative to fixed fines is a penalty scheme based on a driver's fault. The only flaw being, drivers will suddenly become inventive and misrepresent the cause of damage. The number of mysterious accidents in car parks while drivers are in meetings will suddenly go up and the fleet manager will be no better off.
Worse still, drivers will stop reporting accidents, which could have severe consequences if a third party is involved. The third party's insurer will not deal with the claim until a claim form has been submitted by the company driver and in the interim the cost could escalate.
Ultimately, unreported claims could potentially leave the company explaining to a court its failure to comply with the civil procedure rules.
Effective risk management is the best way to create a crash-free culture. Occupational road accidents are a major health and safety issue for businesses and require more than simple driver training.
Only by implementing a clear safety policy across the company can driver attitudes be changed. Policies, practices and procedures must be designed to support the expected changes in driving habits and the new safety programme has to be driven from the top.
Provide drivers with a culture that encourages them to put safety high on their agenda.
For instance, companies can implement policies that minimise the number of driving hours and the need to drive at night, as well as controlling drivers' rest breaks. Concentrate on driver selection to ensure that only drivers with appropriate attitudes, competence and experience are employed.
Think about introducing regular medical checks such as eyesight tests. Through effective, well thought out strategies, company driver attitudes can be enhanced and fleet managers will benefit from healthy staff and healthy premiums. Driver penalties can work in reducing accident numbers, but it is always better to take a company-wide approach.
By focusing on risk management and safety, businesses can change the culture and shift the drivers' attitude from one of 'the insurer will pay' to 'we will all pay'.'