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Vehicle tracking - insurance
Insurance PDF Print E-mail
Written by Administrator
Saturday, 24 January 2009 21:00

Insurance

vehicle tracking insurance

Minorplanet and Bluefin partnership...

Bluefin Insurance Services Limited is the independent insurance broker partner of Minorplanet Systems plc for insurance and risk management advice and is authorised and regulated to undertake insurance mediation activities by the Financial Services Authority.

Insurers continually strive to find the means to reduce the number and severity of claims by improving the insurance Risk Profile of the fleets they insure. Risk Management is the key to achieving this objective.

Bluefin recognises the benefits of the Fleet Management Reports produced by the Minorplanet Telematics system in so far as they introduce a far greater degree of Risk Management. The consequent reduction in claims potential may be reflected in reduced premiums offered by those insurers who have “bought in” to the benefits introduced by Minorplanet.

 

Fleet managers have long since specified vehicle management information (VMI™) systems to improve productivity and reduce fleet running costs. But it is the specific risk management elements built in to the latest systems which has led to the growing interest in telematics by insurers.

About Bluefin

Bluefin insurance brokers

Bluefin provides custom-made insurance and risk management solutions.

As one of the UK's leading insurance brokers Bluefin provides custom-made insurance and risk management solutions to many major UK companies and is the second largest independent provider of SME insurance. It's stature in the market enables it to achieve it's clients' objectives, without compromising on cost or the scale of protection it arranges. It also enables its qualified teams to provide a professional support service.

Bluefin Insurance Services Limited

Telematics and the Insurance Market

Insurers continually strive to find the means to reduce the number and severity of claims by improving the insurance Risk Profile of the fleets they insure.

Risk Management is the key to achieving this objective.

By using GPS tracking to generate an accurate driver performance feed, it is possible to build a proactive driver performance history that can direct the attention of fleet managers to poor driving behaviours and therefore provide an opportunity to manage them.

Certain insurers recognise the benefits of the Fleet Management Reports produced by the Minorplanet Telematics system insofar as they introduce a far greater degree of Risk Management. The consequent reduction in claims potential is reflected in reduced premiums offered by those insurers who have “bought in” to the benefits introduced by Minorplanet.

This partnership offers you the opportunity to obtain a quotation for your Motor Fleet insurance when Telematics is introduced to all, or part, of your fleet.

There are a range of fleet management reports produced by the system:

  • Journey
  • Idling
  • Service and Maintenance
  • Schedule Adherence
  • Excess Mileage
  • Fuel Utilisation
  • Time at Location
  • Driver Hours
  • Driver Exceptions
  • Driver Behaviour

Fleet managers can use these to improve the efficiency and effectiveness of their mobile assets (driver and vehicle).

The Fleet Management Reports produced by Minorplanet benefit insurers by introducing Risk Management controls:

  • Driving styles/behaviour – allows fleet operators to manage poor driver behaviour before it results in an accident
  • Hours driven – fatigue is a significant factor in the cause of accidents
  • Regular servicing – accidents caused by unroadworthy or poorly maintained vehicles can be mitigated
  • Crash information – aids post-accident analysis and the defence of third party claims
  • Decreased fraud – with more accurate information the insurer is more likely to establish where the responsibility lies
  • Asset protection – assists in stolen vehicle recovery and breakdown location assistance

The benefits of an improving risk profile can be summarised as follows:

  • Improved driver performance – hours, speed, style
  • Fewer accidents
  • Improved roadworthiness of the fleet
  • Crash information – using a crash buffer the last 5 minutes of the vehicle’s movement can be recorded
  • Decreased fraud
  • Asset recovery

In an insurer test of 19 fleets and 1,024 vehicles the driving performance amongst fleets fitted with Telematics improved significantly such that:

  • 70% of fleets achieved a reduction in claims
  • Speeding reduced by 80%
  • Fuel savings of 11% were achieved
  • Average premium reduction of 11%

This is the “Duty of Care” owed by an organisation to its employees and non-employees arising out of its business.

If somebody is driving on the organisation’s business then this comes within its “Duty of Care”.

Regardless of how many vehicles you operate, there is legislation that governs road safety, including the various Road Traffic Acts and Regulations supported by the Highway Code. In addition there are a number of related Statutes that are intended to safeguard road users. These include Regulations covering the construction and use of vehicles, Health & Safety legislation and Regulations covering the carriage of dangerous goods by road.

When vehicles are being used or driven on the highway by persons working for an employer under a Contract of Employment, the employer has a “Duty of Care” under the Health & Safety at Work Act 1974 together with a Common Law “Duty of Care”. This means that an employer must take reasonable care to protect employees from the risk of foreseeable injury, disease or death whilst they are at work.

It is important to note that the vehicle is considered to be a place of work.

The employer also is “vicariously liable” for the acts of its employees. Where the employee drives recklessly or breaks the speed limit it is the driver’s responsibility. However where speeding is due to inappropriate scheduling of appointments by the employer, liability could be joint, i.e. they could both be prosecuted.

Employers therefore have a responsibility to manage Health & Safety. There need to be policies, procedures and “safe systems of work” in place to reduce work-related risks, including the on the road activities of employees.

Key Risk Management Areas

There are three key Risk Management areas that employers need to give attention to:

  • Driver
  • Driver vetting and selection
  • Induction procedures
  • Licence checks
  • Accident reporting procedures
  • Vehicle
  • Vehicle Suitability
  • Vehicle Maintenance and Inspection
  • Vehicle Security
  • Journey
  • Journey planning
  • Managing driver fatigue
  • Speed management
  • Journey type

The Health & Safety Executive (HSE) has an occupational road risks (ORR) publication. A copy of the “Driving at Work” leaflet can be downloaded at http://www.hse.gov.uk/pubns/indg382.pdf.

Persons found guilty of breaching Road Traffic Law can be subject to a wide range of penalties including prison for serious offences. Directors may be liable if it can be shown that their negligence contributed directly to an injury.

Corporate Manslaughter

The Corporate Manslaughter and Corporate Homicide Act 2007 received Royal Assent on 26th July 2007. It came into effect on 6th April 2008.

Previously, to convict an organisation of manslaughter following a work related death it had to be proved that someone senior in the organisation, often referred to as the “directing mind” was also guilty of manslaughter. This made prosecuting large organisations difficult.

The new offence does away with the requirement to prove the guilt of a directing mind. From now on an organisation will be guilty of corporate manslaughter if death is caused by a gross breach of its “Duty of Care” that is substantially due to senior management failure. Thus the failures of a number of senior managers can be aggregated to prove the case

The jury will be asked to consider how serious the organisation’s failure was and how much of a risk of death it posed. The jury may also take into account the “attitudes, policies, systems or accepted practices” of the organisation relevant to the failure (in other words the organisation’s “safety culture”) and relevant Health & Safety guidance. From a general Health & Safety point of view this would include HSE’s Successful Health & Safety management (HSG65) and specifically for Occupational Road Risks (ORR) HSE’s Driving at work: Managing work-related road safety (HSG382).

The Police will investigate with the assistance of the Health & Safety Executive (HSE).

An updated edition of the Police’s Road Death Investigation Manual will be published shortly and will have a section on corporate accountability for road deaths.

The Police will consider how ORR has been managed.

The starting point will be HSGindg382. This considers the three elements of ORR to be:

  • the vehicle (i.e. was it roadworthy?)
  • the driver (i.e. was he/she fit to drive or was he/she competent?)
  • the journey (i.e. was he/she asked to drive too great a distance in the time available?)

The fact that an employee has taken a cash option in place of having a company car does not mean the organisation can “contract out” of its “Duty of Care”. This issue is whether the driver was driving on the organisation’s business.

Expect the way in which an organisation manages ORR to be compared with the way it manages Health & Safety risks in other parts of its business. A further significant issue is likely to be how the organisation monitors, audits and reviews ORR. For example checking an employee’s driving licence, ensuring roadworthiness and following procedures for monitoring schedules, driver hours/distances and driver behaviour.

As with a breach of HSWA a convicted organisation will face an unlimited fine.

However expect the fines to be much larger. The starting point will be the level of fines imposed for serious breaches of HSWA where the organisation’s failure is found to have caused or contributed to the death.

Mistakenly, people believe the new law means there will be no prosecutions of directors or senior managers.

However senior individuals can still be prosecuted under the existing Law for manslaughter (which is not altered by the Act) and Section 37 HSWA (i.e. if the Health & Safety failure is caused by the consent, connivance or neglect of a director).

An individual convicted of work-related manslaughter is likely to receive a custodial sentence of around two to three years. Last year a Managing Director was fined £75,000 and ordered to pay costs of £103,500 for a breach of Section 37 HSWA.

The Court of Appeal has ruled in a recent case that a director can be guilty of breaching Section 37 HSWA through neglect even if he/she did not have direct knowledge of the relevant failures that led to the incident but ought to have done so.

Conclusion

The value of Telematics lies not only in cost savings from improved efficiency and reduced insurance premiums.

It can also play an invaluable part in putting into place practices and procedures to provide an audit trail in relation to the “Duty of Care” responsibilities of an organisation and its senior management. The “Duty of Care” reporting available through Minorplanet’s Fleet Management Reports will alert fleet operators to poor driving behaviour, excessive journey times or driver hours and service and maintenance information. Identifying and managing the risk through appropriate remedial action will enhance the organisation’s day to day operational capacity and efficiency as well as allowing it to comply with its “Duty of Care” responsibilities.

Links

VMIgreenlight™ vehicle tracking system
GPS Vehicle Tracking system

Fleet Management Reports
Highly informative and easy to understand reports that are designed to save you and your drivers time and money

Duty of Care
Every employer has ‘Duty of Care’ obligations to meet in respect of the welfare of employees whilst at work

Driver Benefits
Improved efficiency and peace of mind

Service & Maintenance
Plan your servicing in advance to enable minimum downtime and maximum productivity

Asset tracking
GPS asset tracking for trailers, assets and valuable plant

Phone Dialler
Control over the numbers called, control over cost

Driver ID
Ensures the correct identification of drivers where vehicles are frequently driven by different people

Last Updated on Wednesday, 10 March 2010 17:32
 

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