Commercial Insurance - Commercial Auto
Car Theft
A technically skilled work force, global markets, and just-in-time parts delivery have made stolen cars a $7.5 billion industry in the United States. Forget those joy-riding teenagers of the '60s and '70s; cars today are stolen primarily by professional thieves working with middlemen, brokers and coordinators. New features on cars are deterring amateurs, but the professionals know their way around alarm systems and steering wheel locks. And, the chances of getting a stolen car back in drivable condition are far lower now than they were 20 years ago. Stolen cars are shipped, stripped, burned then buried. If your car isn't recovered in a week, it's probably gone forever.
Among the top 10 stolen vehicles today (according to the National Insurance Crime Bureau, an insurance organization that attempts to reduce and uncover crime): (1) Honda Civic (1995), (2) Honda Accord (1991), (3) Toyota Camry (1989), (4) Ford F-150 (1997), (5) Chevrolet C/K 1500 (1994), (6) Acura Integra (1994), (7) Dodge Ram Pickup (2004), (8) Nissan Sentra (1994), (9) Toyota Pickup (1988), (10) Toyota Corolla (2007). Least likely to be stolen are the Buick LeSabre, Buik Park Avenue, Ford Taurus station wagon and the Saturn LW station wagon (According to the Highway Loss Data Institute). Data indicates that ease of stealing has little to do with which vehicles are stolen; although this certainly does not mean we should stop making them difficult to steal!
While a it may be futile to block the skillful and determined car thief, using precautionary devices such as anti-theft systems will deter the less skillful. Security devices may reduce your Auto Insurance Premiums too. Security devices can be classified as:
- Alarms which may be original equipment or aftermarket items commonly costing $100-$300. Carriers distinguish between active and passive alarm types.
- Engine-disabling systems, which cut off the gas supply or interfere with the engine's electronic controls. The latter tend to cost $150-$200.
- GPS tracking decices, which allow security services or the police to pinpoint the locate of a stolen car. The price of these systems is around $600. Police report a 95% recovery rate on cars equipped with these devices, as opposed to the general recovery rate of 60%.
Driving Hazards
When focused, most drivers tend to be both safe and prudent. However, various distractions, even of the most common type, slowly erode what most consider acceptable driving conditions. For instance: talking on a cellphone behind the wheel rewards drivers with a 34% increased chance for an accident. Additionally, loud music from a stereo (and the obligatory karaoke) may increase that chance to 50%. Increased accidents mean increased premiums! Please consider easy fixes, such as hands free dialing and socially acceptable decibel levels, before shifting into gear!
Which of Your Cars Are Protected
Protection from liability for individual employees using their own autos can be obtained by adding an 'Employees as Insureds' endorsement to the policy. When a business drives or parks customer vehicles (i.e. Restaurants, hotels, theatres, etc), the Business Auto Policy (BAP), even with Hired Car and Non-Owned Coverage, will not cover damage to customers' vehicles while those vehicles are in the business' care, custody, or control. Nor will the unendorsed Commercial General Liability Policy offer the protection you need against this common exposure. Garagekeepers Insurance is needed. Perhaps it's time to review the auto loss exposures your firm faces.
Alcohol Regulations: Follow the DOT
On January 1, 1996, the US Department of Transportation's (DOT) alcohol testing regulations went into effect. This affected roughly 7.5 million employees nationwide, primarily those holding Commercial Driver's Licenses. Companies that employ people in public safety-sensitive positions are subject to these regulations:
- An alcohol concentration of 0.04 or greater prohibits the employee from driving. If an employee is subjected to a breath-alcohol test and found to be beyond the legal limit, they cannot return to their respective job until substance abuse evaluation and rehabilitation is completed. The employee is also subject to six random substance tests during the succeeding year.
- Covered employees are subject to reasonable suspicion and post-accident testing.
- 25% of a public safety-sensitive workforce must be tested annually on a random basis.
Even if a business is not regulated by the DOT, some states require Workers Compensation discounts for business with an alcohol-control program in place. The National Institute on Drug Abuse has declared that one in 10 U.S. employees abuses alcohol.
Vehicle Cost: The Bottom Line
For most businesses, autos and trucks are essential and represent a significant portion of the business' costs. But how many managers figure accidents (loss time and Workers' Compensation) into the total cost of vehicular use? Traffic accidents cause more employee deaths than any other job peril. Risk management steps to prevent vehicle accidents may save your business more this year than any other savings strategy. Driver refresher courses are a good idea, and features such as hands-free mobile devices can help lower distractions. The mere addition of reflecting tape to the sides of trucks has been shown to prevent accidents, especially at intersections. A little time and money spent now on preventing business vehicle accidents may save far higher costs down the road.
