CUT PREMIUMS BY REDUCING RISKS
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• Britain's commercial vehicle operators must improve their operating standards in order to become a more attractive risk For the insurance market.
Those that don't will confront higher premiums. Operators whose claims records are consistently bad could be Forced out of business because of insurer's refusal to handle them.
Brokers and insurers are of one in urging hauliers and own-account operators to initiate risk management programmes, to upgrade operating performance, tighten safety, monitor accident records and improve driver recruitment and training. "Risk management courses should be tailored to the needs of individual companies," Derek Lyons of Brian Sharpe Insurance Brokers says:. "Insurers ore looking at the balance sheets and this is one area where hauliers can help themselves."
Brian Johnson, managing director of RHA Insurance Services says: 'Risk management merely means knowing all operations of your business and applying training, safety and common sense in each area." A more efficiently run business will result in more affordable insurance premiums, he adds. RHA member companies, he points out, also need to protect their business by advising customers and sub-contractors of the conditions of carriage under which they operate. Firms that failed to do so have been bankrupted when a customer sued for compensation arising from a sub-contractor's error.
"Hauliers should be minimising their risk exposure, looking upon insurance as the last resort to fill the gap," says Roger Nolan, the Freight Transport Association's financial. He adds that underwriters increasingly insist on dealing with a company that has reduced its risk.
Most hauliers arrange insurance cover through a broker who will trawl the market to find the policy that matches his client's need in cost and cover.
As commercial vehicle insurance is specialised, hauliers need to select a broker which has such expertise. They come large and small, but are few in number. But some hauliers prefer to deal direct with an insurance company, such as Norwich Union, whose policies cover all types of vehicle, fleet operators and owner-drivers. A 40% no-claims discount over a three-year period is proving an effective incentive for owner-drivers, a spokesman said. Although Norwich Union offers cover for related areas, such as legal fees in the event of a dispute, this is purchased separately from vehicle insurance. Brian Arnold, an assistant director of Sedgwick UK, has detected a softening in premiums in the last four months as underwriters have seen their capital increase. But he questions whether this will continue: "The usual pattern is for premiums to soften when interest rates are high, which they aren't at present" he says.. Sedgwick UK is one of the UK's biggest brokers and specialises in arranging cover for own-account fleet operators. In common with other brokers, Sedgwick's gives priority to helping its clients improve their claims record and so hold down their premiums.