Insights

Fleet Safety Best Practices


One of the larger vulnerabilities for organizations right now may be one that many do not realize they have. Fleet safety impacts not just those companies that own their own fleet of vehicles, but also companies that don’t realize they have fleets. Sales forces using private vehicles, employees that run errands regularly or any employee using a personal vehicle in the performance of their duties are exposing your organization to loss.

And those losses are mounting. According to the Bureau of Labor Statistics, motor vehicle crashes are the first and second leading cause of death in every major industry group. Of those workers killed in vehicle-related accidents, 24% were driving or riding in a motor vehicle on a public road. A Network of Employers for Traffic Safety report found that in 2019, motor vehicle crashes cost employers $72.2 billion.

What’s more, insurance costs are also increasing — for those organizations that can still obtain adequate coverage. The consequences of an accident can be severe: higher worker’s comp claims, disability costs, accidental death claims and third-party losses, combined with the cost of replacing vehicles, are all driving up the price of fleet insurance. As insurance carriers face more costly claims, they are placing stricter parameters around whose business they will accept.

All of this has created an exceptionally hard market in the fleet insurance space. Even the best employers and companies are seeing price increases as losses continue to cause carriers to lose money year over year. The result: they are writing business, but only for the best risk portfolios.

The Hidden Exposure


Too often, organizations have an uninsured hidden fleet. Employees using their personal vehicles for work-related duties are often overlooked in the risk assessment.

That’s a big oversight. An employee involved in an accident could have a million-dollar claim — a claim that is not fully or adequately covered by personal auto insurance. The employer will then be expected to pay. With any luck, the employer has put coverage in place for such events.

Lowering the Exposure


Every solid fleet safety plan, therefore, should consider every possible scenario of what constitutes their fleet. The smart organization is one that will conduct a thorough evaluation of their fleet, including any personal vehicles used for on-the-clock work.

Fleet safety includes vehicle maintenance, but it is more about how you manage the drivers. That starts with driver selection. Know the driver’s past driving history. An evaluation of their motor vehicle record can uncover unwanted behavior. All new drivers should undergo defensive driving training. That includes employees who are not drivers, but will be using their own vehicles for work purposes.

Policies should be tightened to outline the consequences of not driving safely. Consider using telematics devices to monitor driver behavior. Such devices makes it possible to spot where additional training may be needed.

Such managing of safety is critical to lowering the exposures your organization faces. Another way: managing accidents. When a driver has an accident or even a near miss, a thorough investigation should be launched that day to understand what factors contributed to the event. Was it a driver training or lack of training issue? Was it a mechanical issue? In one case, an NFP client was experiencing the same near-miss incident repeatedly. An investigation showed that where the vehicles were required to park to pick up passengers was an unsafe location.

Without an active and ongoing analysis program of both drivers and accidents, that kind of course correction may not happen. A solid program can identify potentially large exposures and help your company reduce the likelihood of loss.

Whether your employees drive for a construction site or make in-person sales calls, your fleet exposures – and the best practices needed to reduce those exposures – are the same. To obtain the right amount of fleet coverage, take the appropriate measures. Put the best practices in place, and manage the process.

NFP fleet safety experts can help you locate resources to improve your safety program effectiveness. Through our relationships with insurance carriers, we work to understand what the carrier’s requirements are, and help develop coverage that takes those added safety measures into account.

Your best fleet safety program starts with your commitment to lowering your exposures. If you put the right standards in place and actively manage the program, your losses will decrease, and your fleet – no matter what vehicles are part of it – can operate safely.

For more information, please contact Ralph Corrado at ralph.corrado@nfp.com or Michael Smith at michael.smith@nfp.com.


This information is presented from an insurance and risk management perspective only.  It does not present an opinion by NFP on any other subject matter and  is not intended to give business or legal advice. Consult your attorney and other professionals to ensure legal compliance and evaluate business implications.