Extortionate Hire charges are crippling companies Fleet Insurance Premiums
We are motor fleet insurance specialist and have recently come across 2 cases where insurers are being pushed to pay overinflated hire charges.
As a broker we try our hardest to keep down the cost of clients 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 fleets is not eating into their profits or overheads.
Unfortunately, recently we have had 2 occasions where insurers of our clients have been pushed to the limits by management companies trying to claim excessive hire charges for claims.
In the papers you hear a lot about injury claims, but when you get management companies charging 48k hire charges for a motor bike worth 3k you soon realise that it’s another area which is pushing up premiums in the industry.
In this instance one of our clients vehicles hit a parked 3rd party motor bike last July, the claim has dragged on, with hire charges sitting at £150 per day we eventually arrive at the hire figure of 45k.
This particular client last year paid 12k for their fleet insurance and now Insurers this year have come back with a quote of over 60k due to this claim and the costs incurred.
It’s outrageous as the client can’t afford that and being a scaffolding company they rely on their trucks being out on the road.
The other claim was when one of our clients reversed into a Bentley continental causing minor damage to their rear bumper. The damage was estimated at 3k. The claims management company took the Bentley away although still drivable and then 8 weeks later are billing own insurers for 25k hire and 3k repairs. It makes no sense at all and is 100% transparent that there is no control over what these companies believe they can charge.
Insurers are now having to pay specialist solicitors just to protect them from these spiralling costs. These are just 2 cases that I have encountered in the last 6 months so just imagine how many more of these are happening on a daily basis!
It’s circumstances like this which is straining the fleet insurance industry to line non participants pockets, with the end result meaning they are putting good honest companies out of business due to their greed.
