Introduction of Continuous Insurance Enforcement (CIE) could dramatically increase risk management solution demand in relation to grey fleet - employees who drive their own cars on business - and could fuel company car growth.

Additionally, entrepreneurial leasing companies may see the law change as an opportunity to build fleet insurance into the lease rental so they ‘take control’ of the whole administration burden introduced as a consequence of CIE.

Very few employees who drive their own cars on business are likely to be aware of the law change and the MID - checks to see if vehicles are recorded on the MID can be carried out free of charge online at www.askmid.com

Jon Gilbert, ING Car Lease’s director of customer service, says CIE should act as a further wake up call to the public and private sector to ensure they have comprehensive grey fleet documentation checks in place.

“We are using CIE as a pitch to encourage the take up of our Risk Assist product,” he said. “There are thousands of grey fleet vehicles in use in the public sector and I don’t think the segment is as robust in its management checks as it needs to be. We have also seen an increase in our corporate customers undertaking more checks as part of their grey fleet responsibilities.”

Nick Hardy, sales and marketing director at Ogilvie Fleet, said: “There are an increasing number of reasons why running a grey fleet is not the right answer for organisations and the introduction of CIE adds to that list.

“Employers must make sure that vehicle documentation checks are carried out - even though any fine will go to the drivers - but I would suggest the majority of customers we have that operate a grey fleet are trying to get employees out of that situation.

“However, some employees have a contractual right not to have a company car; but there is increased pressure on grey fleet drivers to get into company cars.”

Multi-marque European leasing company Alphabet is believed to be one of the very few contract hire companies that already offers insurance-inclusive contract hire in the UK. It offers premiums, fixed for up to four years, on virtually all makes of car, paid as part of the monthly rentals in contract hire or purchase agreements.

Alphabet says that premiums are worked out on the basis of each customer’s actual fleet loss ratio, so it’s not just a question of ticking a particular box on a contract agreement at signing time.

However, if a business prefers to run its vehicle budget on a ‘set it and forget it’ basis as far as possible, so it can concentrate on its core business, insurance inclusive contract hire puts insurance into the inclusive, known-cost benefits of the contract hire funding bundle, especially if the customer’s loss ratio/premiums don’t usually vary much year to year.

Although popular in some European countries where insurance is provided as ‘standard’ with the vehicle, it has yet to take off in the UK with Mr Hardy believing such a move would be complicated and could only work via a sole supply agreement.

He said: “Packaging insurance into an agreement would seem a sensible solution. But I think it would mean customers having to commit to sole supply otherwise the administration burden would increase.”

Nevertheless, while not providing insurance, leasing companies spoken to by Fleet News that have full outsourcing agreements in place with fleets already manage MID reporting on their behalf.