For medium to large commercial vehicle fleets, the single biggest factor in determining their insurance premiums is their claims history, usually taken over at least three years. Insurers will be particularly looking at the frequency, number and total cost of your claims. For small fleets, they tend to look more at individual driver records, especially their age and experience. For all fleets, overall mileage is a key factor. It is in your obvious interests, therefore, to keep your claims history as low as possible.
Thankfully, there are a series of tried and tested measures you can take to attempt to reduce risk and improve your accident history, thus improving premiums. Their effectiveness depends very much upon your operation, your management, your insurance company and to an extent, your drivers, but they all work. Different insurance companies can take a different view on the level of risk in your fleet and reflect that in your premiums, which is why it is so important to shop around.
So, the key interventions to look at when attempting to reduce your insurance costs are:
1) Camera Technology – cameras have probably been the insurer’s number one technology favourite for many years, primarily as a weapon against the rising tide of fraudulent claims. Forward facing cameras provide valuable data for promptly defending claims or swiftly settling at-fault claims. Rearward or side facing cameras are particularly effective at reducing the costs of damage claims.
2) Driver training – Insurers really like to see evidence of effective and targeted driver training programmes, especially defensive driver training. It is best to monitor training in parallel with your incident records to measure how effective the training has been. Telematics will greatly aid and support the whole driver training process which will also give additional benefits by reducing fleet fuel consumption.
3) Risk Management – it pays to work with your broker and your insurer to assist in analysing your claims history in order to highlight areas for improvement. Carry out risk assessments of where incidents have happened in the recent past and produce a plan of how to reduce the risks of future incidents. .
4) Young Driver Risk Management – The shortage of commercial vehicle drivers in the UK means that many organisations have to accept drivers of all ages. However, insurance companies take a dim view of young drivers, purely due to their poor claims statistics. Work with your insurance provider to find ways to restrict your use of younger drivers until they reach 25 years. Perhaps use them on smaller, lighter weight vehicles until they reach a stated number of years’ service with you, or maybe use additional tracking and a top speed limit.
5) Limited Top Speed – some organisations have elected to take a few mph off the legal limited top speed including a number of van operators, mainly to save fuel. However, operators with such a policy often report their drivers are more relaxed when driving and thereby reduce incidents, which insurers like.
6) Telematics – Insurers like the fact that vehicles are constantly being monitored. Using Telematics fully to monitor and improve driver behaviour will considerably reduce incidents with resulting reductions in premiums. This technology is often combined with cameras, so the telematics can often pinpoint infringements and the cameras provide suitable evidence.
7) Increased vehicle security – for high value vehicles or loads it may be worth looking at specialised security trackers which are hidden and have back-up batteries and more than one method of transmission to help find stolen vehicles. Consider fitting additional alarms if vehicle theft is a specific problem for your operation. If your location is an issue, try improving the security of your depot and parking, such as better fencing or lighting – work with your insurer to find out which interventions have the greatest financial effect.
Whatever the size and composition of your fleet, never think that there is little you can do to reduce your insurance premiums. All the above techniques have been shown to work well on reducing costs, they just need some perseverance and someone to keep a constant eye on the statistics.
David Wilson
8 May 21
