How to Cut Fleet Insurance Costs
Did you know your fleet is exposed daily to massive risks? These risks influence how much you’re paying for fleet insurance for your business. Risks can come from exterior sources or from the drives themselves.
More than 14,000 South Africans died in road accidents in 2016, and since 2013, the accident fatality rate has picked up by over 18%! Accidents affect your bottom line and the cost of insuring your fleet. Most accidents are caused by human error and poor driving behaviour. This is good news for your budget, because it means you can do something to reduce claims and costs related to your fleet’s insurance.
Reducing the amount of claims you make is just one way to save on expenditure for insuring your fleet. We’ve found the top five ways you can save on insurance premiums for your fleet.
Five Ways to Get Lower Premiums for Your Fleet
1. Carry Out Risk Assessments.
Any successful operation understands the value of frequent risk assessments. A risk assessment is best carried out by senior members of the business, with input from members actively involved in the operation being assessed. When assessing the risk profile of your fleet, inspect accidents and insured incidents in detail.
You can list each accident, its cause, and its financial impact on your business. Next, assess the efficacy of your accident claims process and the way your fleet is managed. You can look at statistics and industry standards to identify areas of high risk. You can then identify weaknesses in your processes to improve.
Many insurance providers may reduce your monthly premiums if you can demonstrate you are equipped to monitor incidents and take effective action when required. Some companies may not have the capacity to carry out risk assessments in-house. Thankfully, some insurance providers have their own risk assessment departments and can work with you.
2. Use Vehicles that Are Cheaper to Insure
A vehicle that is cheaper to insure may not be a vehicle that is cheaper to purchase. Insurers often offer lower premiums for cars that are less likely to be stolen. If your cars feature the latest in safety features, it could lower personal injury claims. For this reason, insurers often offer lower premiums for safer cars.
Newer makes and models often sport innovative fuel efficiency technology that reduces CO2 emissions and other technological features that make driving, maintenance, and parking safer and more accurate. These features may contribute to lower premiums, and they will also lower your costs for breakdowns, repairs, and fuel.
It’s important to check vehicles before driving if your company cannot afford to purchase the ideal vehicle for lower premiums. By doing this, you can save on premiums because you will lower accident claims. Maintenance and repairs should also be kept up to date.
3. Give Drivers Driving Training.
From distracted driving to aggressive behaviour on the road, bad driving can affect your accident rate. It also affects your premiums and increases your fuel costs by an average of 15%! View your drivers as long-term investments and offer them driving training courses to hone their skills. Ultimately this contributes to lower premiums by lowering your claims.
Meet with drivers regularly to pass on the latest in safety standards and measures. You can also reinforce your company’s commitment to safety and good driving by rewarding the drivers with the best safety records. Incentivise their good driving to motivate them.
Drivers’ training can be outsourced or conducted in-house. From advanced drivers training to intensive defensive driving courses, there are a variety of options available. You can also train each river in your company’s accident protocol.
4. Employ Drivers with “Clean” Licenses.
Choose to only employ drivers with excellent driving records, and you can reduce your fleet insurance costs. Bad drivers will cost your business much more than being temporarily short-staffed. Inspect records of drunk driving, speeding, and previous claims for accidents. Insurance providers will also look at these reports when assessing your fleet to determine your premium.
Coordinate your in-house safety regulations with a zero-tolerance bad driving policy to decrease damages due to accidents. Each driver should be thoroughly aware of expectations and the contents of the policy. You can include it in their contract or have the policy signed by each employee. Include your stance on the following behaviours in this policy:
- Alcohol and Drug use
- Road Rage
- Aggressive Driving
- Reckless Driving
5. Use Telematics and Reward Systems.
Fleet telematics is technology that helps you better manage driver behaviour and performance. The results are good – lower accident rates, reduced loss ratios, and increased productivity. With telematics, you can offer your insurance provider in-depth insight into the individual risk profile of each of your drivers.
The insurer is then able to tailor your premiums and evaluate claims faster. With the data provided, they can assess accident scenes and reconstruct events more accurately. Telematics often takes the form of a small device installed into the car paired with digital programs that collect data.
You can take these steps to save on your fleet insurance once you have found your preferred fleet insurance provider. To get the most out of your fleet insurance, compare what different providers offer. Look at things like risk assessment, added benefits, and their reputation for processing claims. Your fleet can then enjoy protection from risks while you enjoy lower premiums.
DISCLAIMER: The information provided in this article is meant for informational purposes only and should not be construed as legal, medical, or financial advice. Facts stated in this article are correct at the time it was published.
Sources: Concordia; cartrack; discovery;