Extortionate hire charges crippling fleet insurance premiums

Wednesday, June 6, 2018 - 09:32
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Businesses with vehicle fleets are being hit hard by insurance premiums due to huge claims from greedy claims management companies.

Experts at ConstructionInsure.co.uk have warned that fleet premiums have rocketed due to claims management companies putting in big bills for hire vehicles

They claim less people are claiming for personal injury after a crash and claim management companies seem to be replacing this with excessive hire charges.

Examples cited by the ConstructionInsure.co.uk experts include a scaffolding company’s van which was involved in a minor collision with a parked motor cycle.

The motorcycle, worth £1,500 was parked and hit by a van. The claims management company placed the motorcyclist on a hire bike at a cost of £150 a day.

By the time the management company had finished with their delay tactics the hire bill came to £45,000 – far higher than the cost of the actual repair.

The subsequent insurance claim forced the scaffolding companies Fleet Insurance premium up from £12,000 to £60,000 the following year – an increase of 500%.

In another case a haulage vehicle knocked a parked Jaguar which incurred wheel rim damage and a punctured tyre (pictured) costing around £1,000 to repair.

To avoid any hire charges, all the claims management company had to do was replace the tyre and wait for repairs to be authorised.

Instead they claimed the car was undriveable and the hire costs of the replacement car came to £10,000.

On another occasion a fleet van reversed into a Bentley continental causing minor damage to the rear bumper.

The damage was estimated at £3,000 but the claims management company took the Bentley away although still drivable and eight weeks later billed insurers for £25,000 of car hire costs as well as the £3,000 repairs.

Mark Herbert of  ConstructionInsure.co.uk said claims management companies were to blame for this worrying trend.

He said: “As a broker we try our very best to keep down the cost of client’s fleet insurance premiums every year with fleet management techniques. As a result, loss ratios for these clients are kept to a minimum, meaning premiums are bearable for the client and the cost of their fleet insurance is not eating into their profits and gives them a better bottom line.

“It’s difficult for clients to take when they manage their vehicles and fleet policy well. A fleet renewal gets looked at by an individual who looks at how the fleet performs. When a fleet gets hit with a hire of over £20k on their claims history, their premium soars.

“There is no control over what these companies believe they can charge and how their actions have a huge impact of a company’s premiums by trying their luck to get these extortionate figures paid.

“It is circumstances like this which is putting pressure on the industry to line non-participants pockets. The end is good honest companies are going out of business due to their greed.”

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