2017 hasn’t been the easiest year to be a fleet manager. Fleet insurance quotes have risen owing to the changes in the Ogden Rate and rises in Insurance Premium Tax, the use of diesel vehicles have become more and more problematic with many hailing the death of diesel cars and fuel prices are back on the rise thanks to the fall in Sterling following last year’s Brexit vote. Yes, things are tough out there and with many predicting hikes in fuel duty come the Budget and with the electric fleets still just a nice idea for many, things look set to remain difficult.
Saving money on all aspects of running your fleet – be it saving on fleet insurance cover or saving on fuel costs – has never been more important. And to help you do just that, here’s our 2017 guide to reducing your fleet costs and keeping your vehicles where they belong: on the road.
There’s been significant movement in the cost of fleet insurance in 2017 and, believe it or not, it’s not down to the industry but the government. The changes to the Ogden Rate – the way long-term personal injury claims are calculated – forced up all forms of motor insurance, not just fleet cover, as insurers scrambled to protect themselves. We have also seen an increase in the Insurance Premium Tax (IPT) from 10% to 12% and inflation has also risen, hitting a four-year high in May when it reached 2.9% and many economists are predicting further rises in the autumn. Add to this insurers’ worries over what Brexit will look like and the prospect of losing access to the single market and you have a perfect insurance storm.
There are, however, ways to reduce your fleet insurance costs and these include:
- Shop around and use an independent insurance broker – as they will be able to search the market to find you a cheap fleet insurance quote that suits your specific requirements
- Look to renew early – it’s widely predicted that IPT will rise again in the Budget as the Chancellor looks for ‘soft’ revenue-raising measures, so if your policy is due for renewal between now and November you may want to start looking for a fleet insurance quote now
- Invest in driver training – nothing will drive up the costs of your fleet insurance cover like a claim, and with driver error thought to be responsible for 90% of all traffic accidents a little extra training could pay rich dividends
- Install a telematics system in your vehicles – telematics – computerised systems that monitor drivers’ behaviour and vehicles’ positions – can have business-wide advantages, but when it comes to fleet insurance the data they provide can prove to an insurer how safe your drivers are and, in the event of theft, make recovering the vehicle a lot easier
Restructure Your Fleet
Given the economic climate, now is a good time to take a good look at the size and make up of your fleet. Can you make efficiencies in the number of vehicles you have? Can vehicles be pooled? Do certain employees really need a company vehicle? Also look at what your fleet is made up of. Older vehicles are generally less safe and are statistically more likely to be involved in claims and are more likely to need repairing. So, if you remove them then you could save on your fleet insurance as well as the cost of having them on your books.
There’s been an awful lot of talk about electric fleets of late and large firms such as the Royal Mail are starting to switch to this greener form of vehicle. There are significant savings associated with electric fleets; running costs of 2-4p per mile compare very favourably with the 10-12p per mile associated with traditional fuels and there are tax savings for drivers too. Switching to an electric fleet might seem impractical but it can be done as our guide to electric fleets shows.
Nothing will push up your costs like a claim; it’s not just the impact on your fleet insurance, it’s also the cost of repairs, dealing with a claim and the potential loss of an employee through injury. Some drivers will be more prone to claims than others and now is a good time to take a look at your driver profiles and see if there are some who would benefit from driving training or, in extreme cases, be removed from your fleet roster altogether.
Fleet mobility is another relatively new innovation, one that has been adopted as it can cut fleet costs and provide a greener way to move teams around. Fleet mobility is where you use a mixture of company vehicles and public transport to reduce costs. It can also involve the integrating of transport and finance departments and can provide a range of savings for organisations large and small.
Grey Fleets: A False Economy
So-called ‘grey fleets’ – those made up vehicles owned by employees rather than the company are now widely considered to be a false economy. Running these fleets puts you at risk of legal action and, as they don’t enjoy savings brought by fleet insurance and single fleet management, they work out more expensive to run than a company-owned fleet. If you are running a grey fleet, now is the time to stop.
Telematics systems are highly-cost effective at reducing fleet costs. Being able to monitor everything from your drivers’ location, driving efficiency and performance can all help reduce the cost of having them on the road. Studies show that telematics can even improve safety levels too as drivers who know they have a telematics system on board are proven to be more cautious. Once upon a time, telematics systems were only for large companies. These days simple, web-enabled systems can be picked up for just a few pounds per month and the impact they can have can be felt business-wide.
Like Some More Help?
Well we hope that’s given you some food for thought. If you’d like to know more about saving money on your fleet costs, or would like some help getting the fleet insurance cover that’s right for you, then please contact us. You can call us free on 0800 977 6037, email us by clicking here or get a no-obligation insurance quote here.
Coversure Hull is an independent fleet and business insurance specialist. From our base on the banks of The Humber, we offer comprehensive commercial vehicle cover, with particular focus on fleet and special types, alongside other essential business covers, namely commercial combined and liability.
Since opening in 2005, our combination of superb service and outstanding value for money business policies have established us as the insurer of choice for organisations both large and small.
Coversure Hull: We Mean Business
We have made it our business to protect your business. Whether you need fleet, landlord, liability or commercial combined insurance, we can offer you high quality cover from some of the UK’s leading insurers, all at highly competitive premiums that’s backed by our outstanding cover-to-claim service.
Contact Us Today
For a friendly independent service and great value cover, contact Coversure Hull today. You can call us on Hull (01482) 434343, for free on 0800 977 6037 or you can email us by clicking here.
We look forward to helping you with your requirements.
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