Cut the cost of collisions

This feature originally appeared in the June 2022 edition of Fleet News. Click here to read the article in the digital issue of the magazine.

It seems that everywhere you look at present costs are rising, and the fleet sector is not immune from this trend.

The soaring price of fuel is an obvious example, but another area impacted is accident management.

This is partly down to the increasing costs of vehicle parts and repairs, driven by difficulties in obtaining parts post-Brexit, while overall labour shortages also bring an element of inflation, says fleet insurance specialist McCarron Coates.

However, for the most part, McCarron Coates director Ian McCarron says the rise is because there are few simple repairs in modern vehicles.

With so many different and interlinked electronic components within vehicles, any reasonably significant prang is likely to see many parts needing to be replaced.

“The cost of vehicle repairs is driving up overall claims costs and that is not good news for any fleet operator,” adds McCarron.

The situation is exacerbated when the vehicle is electric. Research by insurance broker Griffiths & Armour earlier this year saw one insurance company report the average repair cost for an internal combustion engine (ICE) vehicle is £1,574.

This rises on average to £2,400 for an EV, climbing to £4,800 “for one of the established high-value EV models”.

“As EVs become more mainstream and supply chains grow, access to some parts is challenging,” says Julie Hunt, claims client executive at Griffiths & Armour.

“For example, one case involved a seven-month delay for parts on a Mercedes-Benz EV, so, in these instances, some insurers may look to settle the claim on a constructive total loss basis.

“This is because an accumulation of costs associated with delayed arrival of parts and any subsequent credit hire if a third-party vehicle is involved may convince the insurer to take a total loss approach to settling the claim.”

These factors mean it is increasingly important – for fleets which outsource accident management – that the right provider is selected, while the benefits of any relationship are maximised.

“Because the outlay per accident is increasing, your provider should be able to help mitigate total cost of ownership, so while vehicles have become safer and, theoretically, incident rates have declined, the actual cost of repair has gone up,” says Andrew Chandler, sales director at FMG.

This can be mitigated if accident management providers employ IMI-accredited repair specialists who will scrutinise quotes to ensure the repairs are appropriate and that pricing is reasonable.

Improved repair technology, including Smart (small-medium area repair technique) means minor damage, such as scratches and scuffs, can often be fixed at the roadside, saving a visit to a bodyshop which will likely be more expensive and time consuming.

 

Avoiding expense

As well as the cost of repairing a vehicle, there are other expenses a fleet will incur after a collision including vehicle downtime and credit hire.

One effective way to minimise less obvious costs is by keeping first notification of loss (FNOL) to a minimum if the collision involves a third party.

Failing to report the crash and capture incident information promptly affects the entire claims journey, from validation, deployment of services and cost control of areas such as protracted vehicle repairs and costly hire car rates, to unpredictable personal injury claims and legal fees, as well as fraud.

If FNOL is a priority, a fleet’s chosen partner should be able to help review processes, maximise use of technology and develop communication tools to support drivers.

Once those foundations have been established, service level agreements (SLAs) can be aligned to your goals and you can set review dates to establish they have been achieved.

Fleet managers should also check what visibility they will have of performance levels, where that is real-time self-serve dashboards or a regular reporting schedule.

FMG, for example, updates data daily at midnight and provides live information to fleet managers.

“Account managers should be noticing trends in clients’ data and reacting to that, perhaps to improve communication with drivers or palliate outlay,” says Chandler.

The company publishes a number of white papers each year to show trends in the marketplace and keep clients informed of what is occurring, why, and the measures it is taking in response.

“In accident management a knee-jerk reaction should be avoided at all cost,” he adds.

Examination of drivers’ schedules should raise opportunities for greater efficiencies. For example, if a client’s highest mileages are at a weekend, repairs could – and should – be scheduled for Monday afternoon, ensuring most convenient time off road.

 

Working in partnership

Communication is essential to get the best out of the relationship and should start with introductory calls from the new accident management supplier to main stakeholders; this should set the scene for regular and planned communication throughout the relationship.

“Keeping your accident management partner informed about your fleet priorities and investments will allow them to keep reviewing and improving the service they deliver,” says Callum Langan, commercial director for Sopp+Sopp.

As a fleet evolves, so should the service it receives, ensuring it and its suppliers are working towards the same goals.

Sopp+Sopp provides integration across the supply chain, including telematics and camera providers, and legal and claims services. “We look for ways to maximise efficiency throughout the end-to-end process,” says Langan.

For example, the organisation can connect to in-vehicle camera systems, accessing footage to improve FNOL data.

“We also work with service and maintenance providers to reduce vehicle off-road time or maximise scheduled vehicle downtime,” he adds.

It is also important that your supplier continues to invest in technology; this is partly because tools progress apace and it is essential to keep up, partly because it facilitates new ideas and opportunities.

“If your supplier isn’t committed to continuous improvement, it might be time to go out and test the market,” says Langan.

“Make sure you’re working with the right accident management partner, who is maximising your investment in your fleet.”

 

Profit from the relationship

In addition to clear, proactive communication, good budget management is also important.

“A supplier should make sure they can make a material change to the budget the customers are running,” says Chandler. Working with supply chain partners is a case in point.

He adds: “The breadth and depth of the network does not necessarily mean there is strength in it.

“We are integrated through various systems with our supply chain partners so that we can extract information directly from the network such as body shop repair systems and that allows us to keep customers informed.

“We might use a small network of repairers and operate a pool fleet inside that with vehicles in specific locations.

“That way, the repairer understands they are getting a good volume of work from that client in those places.”

For one client with a large fleet, Sopp+Sopp kept surplus vehicles at selected repair partners and the supplier’s owned bodyshops through sister company Activate Accident Repair.

These became dedicated repair hubs, allowing drivers to exchange vehicles quickly and easily on demand.

It was backed by a network of organisations that provided roadside and mobile and scheduled service, maintenance and repair (SMR) and, through Active Parts, a DIY solution to allow drivers to fix their own vehicles where possible.

This reduced vehicle off road (VOR) times, and repairs were scheduled to coincide with planned work such as MOTs and servicing.

“We operate a multi-layered repair solution comprising our owned Activate Accident Repair bodyshops, strategic multi-site repair partners and an extensive mobile repair solution,” says Langan.

“This hybrid approach gives us greater control over the quality of repairs as well as guaranteed capacity across the UK.

“We also make sure we understand repair capability across our network, so we can repair all vehicle types including HGV, LCV, specialist and electric vehicles.”

 

Customer service

These days, most accident management companies provide a 24-hour service, which helps moderate what is usually a distress situation.

Integrated technology facilitates this to ensure that provider, client and drivers are kept informed morning, noon and night, with regular updates.

Managing FNOL is an inherent part of this. “In our experience, an at-scene telephone reporting policy significantly reduces the time between incident and notification, improves FNOL accuracy and ability to achieve successful intervention,” says Langan.

“It allows FNOL handlers to elicit more information, validate incident circumstances and, where a third party is involved, prompt drivers to collect vital material such as contact details.”

Third-party information should include name, address, phone number, vehicle registration number and exchanging of insurance details.

Taking photographs of the scene also provides a useful record. And where a telephone service is not provided, an app makes immediate reporting convenient for the driver and is easy to use when a driver is stressed by the event.

As soon as possible after the incident, it is important the fleet manager or other relevant individual interviews the driver, while balancing the necessary questioning with the mental and physical welfare of the individual; this always comes ahead of the vehicle.

Employee wellbeing has always been important, but, since lockdown and attendant mental health problems, it has fast risen up the agenda. So, it is important your supplier has a strong record of good customer care; this might include people with training in handling sensitive situations.

Part of accident management should also be accident prevention, and telematics and tracking will alert fleet managers to habits such as sudden braking, speeding or too much time on the road, leading to tiredness.

And bear in mind that accidents can often be caused by stress and personal problems.

All this information can be used as a basis for writing safety policies and training strategies, and should be communicated as a whole-fleet endeavour, rather than targeting any one driver. It can also be part of the brief to a new accident management provider.

The service Sopp+Sopp provides to its clients is based on a menu of products which includes one-day mobile repair and DIY options that allow drivers to undertake simple parts replacements, are available to all customers.

“While some form of automotive repair delays are inevitable, we have developed solutions to reduce their impact,” says Langan.

“We work with repair partners and our internal teams, using our MI platform to ensure all hold-ups are visible in real time and efficiently managed by our network performance team. This level of detail identifies opportunities for improvement and risk mitigation.”

Working closely with the right accident management supplier can bring measurable savings in time and money, but, like all relationships, it has to be managed and the foundation of that is good communication – a solid bedrock.

 

Helpful tips for drivers involved in an accident

■ Get the names, contact numbers and vehicle registration of any third parties involved

■ Swap insurance details (if known)

■ Photograph the scene

■ Record key information, such as location, weather conditions and events leading up to the incident, either on an app (if used) or on paper kept in the glovebox for such purposes

■ Immediately report the incident to your company and/or insurance (dependent on business process)

 

Written by Catherine Chetwynd