Brokers urged to heed lessons to mitigate risks

Brokers urged to heed lessons to mitigate risks | Insurance Business Australia

Brokers urged to heed lessons to mitigate risks

Brokers in the motor fleet market should look to the “lessons learned” from claims to help support their clients.

Chris Wood, Allianz Australia’s fleet risk manager, said that brokers working in the motor fleet space should look to discuss identified high frequency and severity losses, and encourage their client’s staff to report all incidents related to driving, and help the driver and the organisation learn from them as the causes maybe far removed from the driver.

To help give their clients a better understanding of what’s driving their claims performance and costs Allianz Australia has developed a unique benchmarking tool called ‘Criterion’, which compares one fleet against others, highlighting areas of concern.

“[Brokers should] engage with their insurer to identify opportunities for improvement and better understand the hidden cost of a crash,” Wood told Insurance Business.

Brokers should also look to show support for increased excess levels for clients with a higher frequency of claims, Wood said, as this can benefit the client to take greater responsibility, make up for increased crash parts costs including new technology, and improve insurance pricing in both the short and long term.

Quicker claims notifications can also help to assist in managing third party property damage, Wood said, with claims made in less than five days “highly desirable”.

Wood said 2017 was a “very busy year” in the motor fleet space from both an insurance and wider motor fleet perspective.

“Most notably, we have seen the changes in the motor vehicle manufacturing landscape locally with the key manufactures of traditional Australian fleet vehicle ceasing local production, and the introduction of some new driver assistance technologies such as Autonomous Emergency Braking (AEB) on 5-star ANCAP vehicles as of January 2018,” Wood continued has sparked continuing dialogue with fleet managers on what and how to replace fleet vehicles and the implications this could have on running costs, repair cost, the impact of the new technologies and insurance.

“With 100% of vehicles and crash parts now being sourced internationally, the increasing exposure to exchange rates, local stock availability delays, the transparency on parts cost and access to repair methods by manufactures is becoming more complex and the industry is still adjusting to this new normal.”

Wood said that 2017 also saw an increased complexity in vehicle repairs as claims inflation on repair costs increased over the course of the year and is expected to continue to grow in 2018.

Some repairers are aligning with vehicle manufacturers, to better access training, technology, equipment and technical support which would help increase knowledge and help them cope with the increased complexity of repair on newer makes and models.

Wood noted that he also expects to see “increasing hire car costs due to the increasing activities of third party ‘Accident Replacement Vehicle Providers’.”

 

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