This article on insurance premiums was written by Martin Kadhim Partnerships Director at Lightfoot
Firstly, let’s remind ourselves “premium” is just another word for “money”.
Lightfoot works with major Insurers and Brokers helping clients manage their risk through rewarding better driving – check it out here!
One of the questions that we often get asked is –
Will Lightfoot make my premium go down?
Fair question – insurance premiums have been on the rise for years and clients want to manage this.
But, let’s look at the whole picture.
What is to blame for premiums going up?
- Changes in the Ogden rate – the discount rate used by our courts when calculating compensation in personal injury cases – reducing insurer revenue by millions of pounds.
- The increased cost of detecting and managing fraudulent claims as a result of ‘cash for crash’ scams
- The dramatic increase in the component costs for vehicles – “The average cost of repairing a car after a prang has risen by 32 per cent in three years”. This rise in accidental damage costs is due to new safety technology in modern vehicles.
- Reported vehicles thefts rising by over 50% in the last 5 years
- Increase in IPT
Consequently, that small nudge that used to be a claims cost of thousands, is now turning into tens of thousands. For that reason, insurers are picking up this cost and then passing it onto the market through increased premiums.
So, that means that it has never been more important to focus on risk management through better driving. One of the vital variables that a fleet can control and influence across their drivers in vans, company cars and also their grey fleet (where an employee drives their own vehicle for work purposes).
So, yes – Lightfoot can help improve your risk. In the long term, that might mean a reduction in premium depending on your claims costs and frequency but that could take up to three years to come to the surface. More realistically, in the short term, a better performing risk can mean lower increases in premium or static renewals.
Whilst we are focusing on managing your road risk and premium control. We’ll also do our best to achieve an ROI for the business through cost centres that have a more immediate impact than managing premium reduction. This includes fuel, de-fleeting costs, reduced management and downtime.
By engaging and incentivising the driver, businesses who adopt Lightfoot see a direct positive impact on fleet performance and a plethora of associated fleet costs
We help save businesses money – which is exactly what “premium” is.