By: Jason Mellow, Head of MiWay Business Insurance
October is Transport Month and it would be no exaggeration to say that the role transport can, and must, play has never been more crucial to the South African economy. More so as we work towards rebuilding it after the effects of the Covid-19 lockdown. While this month will focus on all forms of transport, the road transport sector merits special attention because of its importance when it comes to logistics across our continent.
The government’s vision of providing safer, more affordable, accessible and reliable transport, will only be achievable if transport companies step up to the challenge, particularly when it comes to risk management. Knowledge is power and it’s a good idea to track the claims history and what incidents occur.
Based on MiWay’s experience in working with clients across the transport industry, here are some key steps to improving risk management:
- Track your incidents as well as your claims. Incidents are the number one predictor of claims, so if you note all incidents – not just the claims – you’ll find where there are problem areas and put preventative measures in place. The goal is to reduce future claims and the chances of premiums being increased.
- Find the trend. It is important to take note of incidents as you could find that many of your claim costs come from the same area, department or cause. If you can find the root cause of the claims, you can be proactive.
- Mitigate your risk. South African roads bring with them a whole set of risks, some of which are universal and some unique to our situation, and by their nature cannot be controlled. However, if you know where the highest risks are, discover the ones that occur most frequently or cost the most, you can establish a risk management strategy that takes you a step closer to protecting your staff and cargo as well as reducing your insurance premium.
According to MiWay records, the top three causes for claims are mechanical malfunctioning, followed by collisions and glass (windshields and windows). Here are five ways you could cut down on claims and unnecessary time-consuming admin.
1. Schedule regular checks and services to ensure your vehicles are well-maintained. All vehicles should be maintained to a minimum standard, with essential safety equipment like brakes, indicators, steering components and tyres, regularly checked and kept in good operating condition.
2. Avoid overloading. Overloading will damage a vehicle, particularly in the long run; it is linked to roadworthiness.
3. Verify your drivers’ information; for example, the validity of driver’s licences and Professional Driver’s Permit.
4. Provide proper training and possible advanced driving courses. People make mistakes; the Automobile Association notes that the single biggest cause of road accidents is human error. This underscores the necessity for appropriate training for every driver.
5. Understand your insurance cover and optional cover available, as well as the excess payable.
6. Make sure you have adequate cover for goods in transit. Truck hijacking remains a problem (the 2019-20 crime statistics show it has increased by a further 1.7%) as does pilfering. Taking precautions against both hijacking and theft is advised, but adequate cover for goods as well as the vehicle is essential.
Whether it is long-haul or short haul, trucks are used by every sector of the economy. Our transport corridors act as vital lifelines as they criss-cross our nation, contributing to the health and strength of our economy. Let’s use Transport Month to manage our transport risks and support our economic revival.