3 Ways to Combat Increasing Commercial Auto Rates
In the past, insurance companies have generally been willing and able to offer very competitive pricing on commercial auto policies. Unfortunately, because this line of business has been underperforming for them for several years, many top commercial auto insurers are attempting to correct this issue by passing along increased auto rates across the board, even if your own business auto losses are low.
So, as a manufacturing or waste owner, what can you do to try to minimize an auto rate increase that an insurance company is trying to mandate? The obvious answer is to control your losses. The following are just a few options that can be implemented to drive down auto-related losses:
- Have an effective fleet safety policy in place, inclusive of driver selection, driver training, driver supervision, vehicle maintenance, etc.. For detailed steps on creating a successful fleet safety policy, check out this post.
- Consider investing in a “How’s My Driving”-type program. These programs actually do provide a reduction in both number of claims and claim dollars, and some insurance companies might even be willing to assist with the cost of such programs, depending on fleet size. Additionally, this type of program allows for “problem drivers” to be identified
- Consider investing in a GPS vehicle tracking & fleet management system. These GPS systems start beeping when the driver is speeding and can also track the following information: the vehicles themselves, erratic driving and seat belt usage. Additionally, you can download reports that provide driver ratings based on the information gathered by the system.
These additional investments could have a significant impact from a loss ratio standpoint (premium vs. incurred losses) and the better your loss ratio, the more room for rate improvement.
Finally, in addition to controlling your losses, it’s very important to communicate what policies and actions you’re taking to keep auto losses to a minimum with your insurance agent. This will help them they have the ammunition they need in the marketplace to negotiate better rates for a better risk. Need advice? Reach out to an ‘A’ Team member.
- 6 Steps for a Successful Fleet Safety Policy
- CSA Measures on Heavy Fleets
- Co-Mingling Company and Personal Auto Risk
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