However effective your risk management processes are as a commercial Motor insurance purchaser it’s inevitable that collisions will occur. Whilst notifying your broker or your insurers of a motor incident is a relatively simple process, the timeliness and quality of that notification plays a critical part in how effectively the claim can be managed. The difference between handling the cost of claims in a pro-active manner as opposed to a reactive one can result in significant savings on third party costs.
Up to 75% of claims costs against comprehensive insurance policies derive from third parties.
This is a plea to all Motor Customers to focus and to keep focusing on early notification of a collision. This is essential for keeping down claims costs and ultimately the premiums we are able to secure for you with insurers. By establishing legal liability early, where appropriate, cases can be settled quickly and economically. When liability is not clear, your insurer will defend claims robustly. When liability rests with you, the focus is on proactively handling the third party claim and driving down the cost through active management. Again, early notification is vital.
This type of work can include making early cash offers to third parties for ‘total loss’ and ‘loss of use’ claims, arranging hire vehicles at beneficial rates (or courtesy vehicles through Approved Repairer Networks where utilised ) and early treatment of injuries also helps to drive down costs.
Early notification helps us with claims involving a third party to be effectively managed from the start. Work to settle claims as quickly as possible, for as little cost as possible. You have no choice really as the cost element of a third party claim is directly linked to the length of time the claim remains open. The longer the claim is outstanding, the more expensive it becomes overall. Specifically, third-party credit hire claims are a challenge to all insurers but early claims notifications help us to proactively manage these from start to finish, containing costs and reducing fraud.
The legal environment is extensive and complex but again early notification of claims helps insurers to work with third party injury claims by making offers on fault claims and negotiating settlement within Pre Action Protocols and the MOJ Claims Reforms Process -thereby containing Claimant solicitors’ costs.
If litigation is needed (and should be avoided as much as possible) managing claims and ensuring evidence is fully collated as early as a possible enables Insurers and ourselves to make the correct decisions on liability and quantum.
Ensure your insurer has strategies in place to deal with claimant law firms that issue proceedings as early as possible solely to increase their own costs, rather than secure damages for the third party.
Brand protection is also something that needs to be considered should your drivers being involved in a motor incident that creates the potential for adverse publicity. By reporting claims promptly this enables insurers and ourselves to pro-actively approach third parties in a comprehensive and efficient manner which can help minimise brand damage.
To protect your driver’s interests and your organisation you must ensure legal representation is available immediately. If you are not obviously partnered someone who excels at Motor Prosecutions then think again. Your broker should be offering a lawyer who has a proven track record in defending the most serious motoring offences both with criminal prosecutions and the appropriate advice around the inevitable civil claim and insurance considerations.
BEST PRACTICE FOR EFFECTIVE CLAIMS MANAGEMENT
Here are some tips on improving the quality and speed of motor claims reporting following an incident:
Clarify the process for reporting between all interested parties i.e. drivers, accident management providers, transport managers, lease companies/ourselves asbrokers, so everyone understands their role and responsibility.
Simplify – The more steps involved in the claims reporting process reduces the likelihood of compliance. ‘One Call’ solutions are the most effective.
Communicate a comprehensive claims management procedure to your drivers covering all types of incident with clear and practical steps that are suited to both your business and the structure of your organisation.
Promote an ‘open’ culture in relation to the reporting of incidents for all drivers. Making it a ‘sin’ for drivers to have an incident, will dissuade them from notifying claims and admitting liability when they’re at fault.
Educate drivers to understand the need to capture key data following an incident and provide it straightaway.
Equip drivers to provide key information with supporting evidence from the outset. The earlier evidence is provided the more opportunity there is to defend effectively or recover losses.
Affirm the ‘need for speed’ when reporting claims. The earlier an incident is reported, the more effectively the resulting costs can be managed.
Use the management information available to investigate whether drivers are adhering to guidelines and identify possible areas for improvement.