Crash costs spark safety crusade
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Crashes totalling £41,670 – more than £1,200 per incident – in 12 months prompted Chelmsford Electrical to introduce a driver awareness programme...
Peter Locke – “The impact that the half-day one-to-one on the road driver training had for each driver was remarkable.”
Operating a fleet of 30 light commercial vehicles and 12 company cars, the electrical company with a turnover now approaching £10 million was told by its insurer to take action to stem its ‘poor’ claims record. Company secretary Peter Locke, who is in charge of the fleet, said: “It was as close to a ticking off from an insurer as you could get.
Our claims record had deteriorated badly.” A ‘carrot and stick’ approach with drivers being offered fi nancial incentives to reduce the number of crashes had failed to work so, said Mr Locke: “We had no alternative.”
In 2001, risk management company Drive & Survive was appointed with all drivers completing the company’s driver awareness programme. At the time, Chelmsford Electrical’s fl eet insurer, Zurich, offered to reduce the insurance premium by an amount equivalent to the cost of training, effectively making it self-funding.
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From what was viewed as a poor and deteriorating claims record in 2000/01, improved dramatically in 2001/02 as a result of the training with a 75% cut in the number of claims to just eight totalling £4,710. A claims value reduction of 89%.
Mr Locke said: “The impact that the halfday one-to-one on the road driver training had for each driver was remarkable.”
That success spurred Chelmsford Electrical, which employs around 100 people and has projects in the City of London, the Home Counties, the Thames Gateway and East Anglia, to commit to an ongoing programme of driver training with Drive & Survive.
Improvements in the company’s claims record have continued and, despite a ‘hard’ insurance market, costs have been contained since the start of the millennium.
It is that record which has led to the company becoming one of the first ‘Business Champions’ under the Government’s ‘Driving for Better Business’ programme.
In 2001/02 the insurance premium per vehicle was £1,350 (excluding Insurance Premium Tax). In 2006/07 the fi gure was £483 per vehicle. In addition there is a retrospective rebate scheme in operation, whereby, provided that the cost of claims is below an agreed percentage of the premium paid, Chelmsford Electrical receives a refund, which in practice is in the region of 10% of the premium.
More recently, Chelmsford Electrical has adopted Drive & Survive’s integrated driver risk management programme, which involves online driver risk assessment for all drivers and thus a risk categorisation for each. The interventions are then tailored to the specific need of the individual – ‘low risk’ drivers need no further action, ‘medium risk’ drivers are recommended for Drive & Survive’s online e-learning modules and ‘high risk’ drivers complete practical, on-road training.
However, Mr Locke believes the most effective training has been on the road. Today, all new employees who drive on business undergo on-road training and any other member of staff who has been involved in an incident in the previous premium year will undergo a refresher course.
He said: “The training programme has worked. It continues to be self-funding. The initiative will not eliminate incidents, but it will help to minimise them.”
The company’s worst crash saw one of their own vans and another car written off last year. However, at the time of interview Chelmsford Electrical had gone almost seven months in 2007 without an insurance claim.
Additionally, said Mr Locke: “The spin-off effects of our programme have been numerous. We have benefi ted from improved business effi ciency, greater productivity and reduced administration.”
Claims
Dismissing often repeated claims from small and medium enterprises (SMEs) that they cannot afford to invest in an on-road safety programme either fi nancially or in terms of taking staff away from their job for driver training, Mr Locke said: “We didn’t think that we could afford that either, but it had got to the stage where we had no choice. Now we are reaping the benefits.
“Now I cannot see any reason why any business would not make the investment that we have done. We were sceptical, but the majority of drivers have been very responsive and the results prove the case for a risk management programme.”
A Drive & Survive spokesman said: “An added benefit of the strategy employed by Chelmsford Electrical is that the company has a ready prepared audit trail of risk reducing activity should the need arise to defend itself in the light of an incident.”