The importance of telematics in commercial fleets
Improve safety. Reduce costs. Get there on time. These are mandates commercial fleet managers often hear. They’re not easy to accomplish individually, let alone as a collective goal – and harder still given the many challenges drivers face on the road.
Consider this: People killed in motor vehicle traffic crashes hit a high in 2017 after a decade of decline, despite the many improvements in vehicle safety technologies. Additionally, in 2018, crashes involving single-unit straight trucks increased nearly 19%. The National Highway Traffic Safety Administration attributes these trends to “human behaviors,” such as speeding, distracted driving and driving under the influence.
What are wholesalers to do?
Increasingly, wholesale businesses are turning to telematics to help them monitor driver behavior – and reduce accidents, incidents and liabilities involving their fleet. “Implementing a telematics system averages about $150/vehicle, and $12/month for service" says Christina Villena, Vice President of Risk Solutions at The Hanover. "But just one accident fewer per year can offset the cost of the system for the entire fleet.” With increasing use of telematics in commercial fleets, data continues to indicate clear benefits.
Potential insurance benefits
- Decreased claims frequency
- Reduced claim settlement times
- Limit the ability of would-be thieves to steal a vehicle – and its cargo
- Reduced fuel costs and optimized routes
- Improved customer service
- Increased fleet safety
- Improved vehicle maintenance
- Improved driver behavior (less speeding, less hard braking, less distracted driving)
Not just a fleeting opportunity
Telematics is not a “silver bullet” solution, but instead a powerful tool to be used in conjunction with an overall fleet management and safety program. Nonetheless, if you work with wholesalers and other clients who manage commercial fleets, encouraging the use of telematics is a value-added recommendation.
With projections indicating a 25% growth in telematics use each year for the next five years1, many of your clients may already be thinking of budgeting and implementing telematics.
You can help them get off to a strong start by informing them of respected vendors. The Hanover has partnerships with several vendors—including Driver’s Alert, BlueArrow, IntelliCorp and Coaching Systems—that offer products, services and training at no charge or at a substantial discount to clients looking to control losses and improve auto-related performance.
5 quick tips for helping a client implement a telematics program
Partner with a reputable vendor.
Suggest realistic goals such as a 5% reduction in fuel costs, 10% lower accident rates, 5% lower mileage, 10% less idle time, etc.
Involve and reward drivers with incentives, awards and leader boards.
Update company policies to reflect use of telematics and address any concerns employees may have.
Review telematics data to make program improvements.
Deliver value to wholesalers
Learn about The Hanover's flexible insurance solutions and services to help your clients protect the whole supply chain.
1 Business Wire