THE continuing COVID-19 outbreak has created an urgency to manage costs like never before. With little or no cash flow but with ongoing costs even with a furloughed workforce where can savings be made.
At WasteInsure we naturally focus on insurance, so we have created some guidance on how to go about reducing insurance costs whilst many of your vehicles are sitting idle. Whilst the risk of accident on the road during lockdown has gone down, some other risks have gone up and we’ve covered that too.
As industry experts and brokers to the waste industry, we’ve also shared some of the pitfalls you need to avoid and our tips for how to get the best from your fleet insurer.
Laid up cover
Most insurers are allowing their fleet policyholder’s to lay up a good proportion of their fleet and reduce the cover to Laid Up Fire and Theft only. This will generate a significant reduction in premium whilst still providing cover for damage to the vehicle whilst parked up.
The rates are typically 25- 30% of the normal comprehensive premium per vehicle, but they vary by insurer.
Check if your cover will also include malicious or accidental damage when laid up, or if there is an extra cost to include it. We can expect an increase in vandalism as some people may have too much time on their hands.
In order to qualify as laid up the insurer will usually wish to see evidence of the SORN email from DVLA. They will also wish you to ensure that the vehicle being kept on your own secure premises (not any public places, employees addresses or on the road, etc, although an alternative secure location away from your premises may be acceptable)
Insurers are aware that your vehicles may be parked up in close proximity in areas that do not normally hold large numbers of vehicles and they are keen to minimise the risk of fire, theft, arson, malicious damage and even flooding. The longer we are in lockdown the greater the risk of unrest which can lead to arson and other criminal behaviour.
We have spoken to the major Fleet insurers and here are some of the questions that the insurers will want answered to evaluate their exposure and calculate the risk premium. The more information you can give them, the better chance you will have of getting a favourable response.
Motor markets are asking the following info:
- What cover is required? Laid up fire and theft or to include damage
- How many vehicles are being laid up?
- Where are the vehicles being kept?
- Individual registration numbers of laid up vehicles
- A value for each vehicle
- A total value at each location?
- How are the vehicles being parked (are gaps being left between vehicles to prevent fire spread or are they crammed together)
- What is the theft protection?
- What is the fire protection?
- Is there any risk of flood/storm damage at the storage site
- Site security is there CCTV, or security patrol on site.
- From what date/dates are the vehicles to be laid up?
Tip: Do not ask your insurer do SORN more than half your vehicle fleet as they will more than likely refuse. Instead lay up those vehicles that are definitely not needed, but leave some spare capacity by keeping a few spare vehicles taxed and insured – you will need them and should things suddenly pick up ( un SORNing vehicles with DVLA and adding the insurance cover back will take time when everyone else is trying to do the same).
Make sure your staff know which vehicles are available and which are out of bounds – you don’t want them taking an uninsured vehicle out.
You need the money now
On larger fleets it is common for the insurer to only charge for changes to your fleet policy on a half yearly or even annual declaration, make it clear to your broker that you need the rebate now not at the end of the year/ half year when the declaration is due. Not all insurers will agree to this but we have found that most are taking a fairly sympathetic view and bending their rules to try and help loyal customers.
We assume these will parked be on the drive for most of the time and not laid up. However be aware that Keyless entry cars (particularly Range Rovers and other prestige marques) are prone to theft by cloning the key signal. Make sure your key is stored in a metal tin or special key pouch away from front of the house to prevent cloning*.
*Any sort of faraday cage is acceptable (eg a microwave or biscuit tin) but we have a supply of special RFID key pouches available that we can send you – just contact us on the number/ email below.
Having hopefully reduced your premium spend, by laying up the unused vehicles what else can you do to keep costs down? Approach your finance providers for a payment holiday. Most of the larger premium financers will agree to reduced payments over the next two or three months and will just add the shortfall to the end of the contract when hopefully cash flow is back to normal. They key is to have that discussion early and before you miss a payment.
Working from home
You and your admin team will probably still be working, but from home. Cyber criminals will exploit any weaknesses in the system caused by firms working from home. Be extra vigilant about email requests asking you to pay money or bills. Always use the contact details in your phone rather than call or reply to the details within the email to check it’s genuine and speak to us (or your own broker) about cyber and crime insurance.
During lockdown you may not be visiting your premises as regularly as usual. Most insurers are being reasonable in allowing flexibility on their standard unoccupancy terms during COVID-19, but check with your broker to ensure you still have cover even if your building remains empty for a longer period than normal. It’s also worth checking that if normal working is suspended, the storage of waste does not build up to put you in breach of policy conditions. Underwriters will be flexible, provided you notify them.
We hope you have found this advice useful. Remember, Wasteinsure are here to help you, whether you currently place your insurances with us or not.
If you have an insurance question, give us a call, we will happy to hear from you, even if it’s just to get one of our key pouches.
Contact us on 01277 844 391 or [email protected]