Like Scar from The Lion King (1994) once sang to his minions Be Prepared. Insurance rates are predicted to go up in 2017. The reasons are specific enough and by no means the fault of average individual drivers, however, fleet managers should be aware of what is coming on the horizon for the costs of their fleets. Accidents increased in 2015 and so did payouts. (Auto Insurance Rate Hikes) However, rates rising are not a simple cause and effect. To safe guard against simply raising rates when accidents increase, insurance companies turn to ancillary businesses to keep prices stable and not lose profits when a season like this arises. Regrettably, bond yields, their plan B of choice, are weak of late leaving them no option but to hike rates. (Auto Insurance Rate Hikes) Indeed, the bond market has still not properly recovered since the 2008 financial crisis. (Auto Insurance Rate Hikes) A massive detriment to conservatively investing industries, because, bonds were long seen as a safe place to park money for modest but stable returns.
Electronics in cars have made the cost of even a minor accident go up dramatically. (Las Vegas Car Insurance Rate Hikes) Even a simple fender bender might involve multiple sensors that would all need to be replaced. No longer can a driver simply take their car to a shop and have Joe, as the name on his mechanic jumpsuit reads, hammer it out and fix it right away at super low costs. Also, modern cars are designed with crumple zones that are engineered to absorb the impact of a crash instead of the shock traveling to the people inside. Modern cars are designed to maximize protection for the passengers and minimize any harm. Once the function of such a mechanism has been served, guess what? It’s time to replace it. And that costs the insurance company, in one way or another, money. Medical bills are increasing, too. (Las Vegas Car Insurance Rate Hikes) While the increased frequency of medical visits and treatments may or may not be a factor, the overall cost of treatment is increasing. Additionally, improving technology has increased the chances of surviving and recovering from a crash, walking away completely untouched is a ways off. Another reason for rising rates is car theft on the rise in certain localities. (Las Vegas Car Insurance Rate Hikes) While this doesn’t translate nationally, it will have a significant impact on a state level. All of these factors combined, it would be wise for any fleet manager to keep a sharp eye on how their specific vehicles can be affected.
What can you do?
This trend of rising costs forces businesses owners to look for ways to mitigate the extra costs. Fleet Management Solution with GPS tracking is emerging as a great way to reduce no only costs but also mitigate the risks of drivers getting into car accidents. Many insurance companies are giving discounts on their insurance rates for vehicles that are equipped with a GPS tracking device. Those savings can quickly add up depending on the size of your fleet. With a Fleet Management Solution you can easily monitor driving behavior, you will be able to see when your drivers speed, hard brake, hard accelerate, and more essential information. This data will allow you to address any negative behavior immediately, therefore reducing any potential risks with your fleet on the road.
Seeing is believing and there is so much to see in our free demo. Find out how our enterprise level fleet management system can help you track your fleet in real-time, assign tasks, monitor drivers and more.