"Tighten up Control of Your Fleet's 'Pedal-To-The-Metal' Culture or Risk Losing More than Just Money" - Says Ram Tracking CEO Chris McClellan

LEEDS, England, April 20, 2017 /PRNewswire/ --

The new speeding regulations - an insurance perspective 

24th April 2017 sees a new and much harsher penalty system come in to force for those caught speeding after this date. The past few years have seen an increasing priority on fleet safety and with good reason, but how does speeding affect fleet insurance premiums, and what can you do about it?  

In the most recent Department for Transport reports, traffic on motorways and rural roads are shown at an all time high - with the % of cars, lorries and vans all rising. Crashes, caused by anything from speeding to distracted driving (e.g. texting whilst at the wheel) can be costly not only to the individual but also expensive to the fleet- with liability capable of spiraling into the millions, not to mention the significant damage to the fleet reputation.

According to the Confused.com car insurance price index, Car insurance prices have gone up £110 over the past year - a rise of 16%. What's more, extra pressures set to impact the insurance industry this year could possibly push prices even higher - potentially tipping the thousand-pound mark next year, the index suggests. The data also suggests that men tend to pay more for their insurance policies than women - and with an overwhelming number of fleet drivers' being male, this is a stat that might well be significant to fleet managers.

There is little argument vehicles are becoming safer - thanks, in part to advanced technology, such as anti-collision braking systems, blind spot detection, rear view cameras, and telematics. Fleets often write clauses for dismissal into contracts as further deterrents, for example being caught whilst using a mobile phone.  But, according to government statistical data, in 2014 exceeding the speed limit was a contributing factor to 16.5% of fatal accidents.

Speeding offences and in particular offences such as careless driving and/or drink or drug related endorsements can significantly affect insurance premiums for fleets when a claim is associated with the endorsement. For smaller fleets, underwriters are more likely to look at speeding offences and tie them in to increased premiums or excesses. For larger fleets, it's often less about individual misdemeanors and rather the frequency and cost of the claims made. Of course, many of these claims may well have occurred as a result careless driving and/or speeding or similar.

Tom Butler, Director, Schofield Insurance , commented:  

Our fleet brokers and the underwriters we use refer to clients 3 or 5-year fleet "Confirmed Claims Experience" (CCE). This details the number of claims made along with the appropriate payments and also the current claims reserves for both the policyholder as well as any third party.  

The CCE also enables them to analyse the average cost per claim and average cost per vehicle, which is calculated on the total of claims divided number of vehicles over a 3 or 5 year period and this figure is then inflated to cover insurer costs, commissions, the rising cost of vehicle repairs and third party claims - the latter has dramatically been affected following the 27^th February 2017 news of a reduction of the Ogden Rate. 

The government lowered the discount rate (Ogden rate), the rate used to determine the value of compensation paid out to a personal injury victim, from 2.5 per cent to - 0.75 per cent. As a consequence motor premiums could sky-rocket as claims reserves have had to be increased. 

Time will tell, but from an insurers point of view, we hope the new speeding implications will indeed minimise the number of incidents and claims. Fleet managers should be aware of the things they can do to minimise premium and excess hikes, including doing a thorough drivers' license check on any new drivers. Those found with endorsements such as careless driving or drink driving are instantly flagged by underwriters and may be subjected to restrictions or exclusions on a fleet policy -  perhaps only being insured for business use, or restricted to lower value vehicles. Installing telematics and tracking systems is a great way to prove that you're doing your housekeeping as a business, especially if you can show you're tracking driver style and speed. The 'big brother is watching' approach is certainly worthwhile for fleet owners." 

Chris McClellan the owner of RAM Tracking, a leading provider of vehicle tracking for fleets added: 

"In short, managing how your fleet is driven and having proof of where they were when a false claim comes in are all ways to reduce risk and mitigate claims that lead to increased insurance premiums. Vehicle tracking means you are able to monitor driver style (speed), and is seen as a positive step by fleet owners by insurance underwriters - it plays a part in insurance premiums and excess. It's worth adding that in 2015, comparison website Money Supermarket ran a test on 1.2ltr Vauxhall Corsa and added one SP40 conviction to the quote (that's exceeding the speed limit). The results showed that for a forty year old there could be an increase from £498.86 to £582.37 and a fifty year old could expect costs to rise from £397.29 to £589.42. This uplift for points could go on for more than simply the three years for the DVLA, often insurance underwriters go back up to five years. So those three points could cost that 40 year old five times whatever the initial increase was. Add to that the fine (which will be capped at £2,500) and it's no small amount!" 

RAM Tracking has created a portal of articles, statistics, quotes and infographics about the new speeding regulations and implications of speeding for individuals and businesses. Visit: https://www.ramtracking.com/blog/category/april-2017-speeding-regulations/

Scott Chesworth, Operations Director, +44(0)330-100-3622