ASSE Fleet Safety Presentation


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Considerations to developing a Comprehensive Fleet Safety Program

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ASSE Fleet Safety Presentation

  1. 1. Developing a Comprehensive Personal Auto Fleet Safety Program Aon Technical Services presentation Insert Business Descriptor Chad B. Krueger Risk Control Consultant Nicolet Chapter-ASSE September 12, 2007
  2. 2. “Motorists have exhibited the one worse attitude than defiance of the law – indifference to it.” Frederick Dwight - 1908 9/17/2007 2 Aon Technical Services
  3. 3. William Phelps Eno (1858-1945) • Does anyone know who this man is? 9/17/2007 3 Aon Technical Services
  4. 4. William Phelps Eno (1858-1945) • The “Father of Traffic Safety – Born in New York City – Developed the worlds first traffic code • Designed: – The stop sign – One-way streets – Pedestrian safety islands – Taxi Stands – Traffic Circle » He designed the traffic circle around the Arc de Triomphe in Paris • He was an avid fan of horse back riding • He never once drove a car, referring to the automobile 9/17/2007 as a “fad” 4 Aon Technical Services
  5. 5. Why are we here???? • Just this morning on Hwy 41 9/17/2007 5 Aon Technical Services
  6. 6. Why are we here???? • Fleet Programs are a Risk Management Best Practice – “Best of the Best” “What are other companies doing?” • Concerns about Negligent Entrustment? • OSHA’s Guidelines for Employers to Reduce Motor Vehicle Crashes-They want to see our fleet programs!!! • Insurance Company Requirements? • High Frequency of Motor Vehicle Accidents? • Some Employees have lost their License. • An uneasy feeling that Fleet Safety needs to be addressed but we 9/17/2007 are not sure how to start. 6 Aon Technical Services
  7. 7. What is a driver??? • Not just CDL/DOT Drivers regulated by FMCSRs. • The driver of any vehicle operated on public roads • Understand that you are not just hiring a: – Salesperson – Foreman 9/17/2007 7 Aon Technical Services
  8. 8. Accident vs. Collision • Accident: – Implies the event is not preventable • Collision: – An event that is generally the result of human error • 90% of crashes is caused by some type of human error!!! 9/17/2007 8 Aon Technical Services
  9. 9. NCCI Study National Council on Compensation Insurance-Dec. 2006 • Traffic Accidents—A Growing Contributor to Work Comp Losses – Key Findings: • Motor vehicle accidents are more severe than the average workers compensation claim, comprising close to 2% of claims but more than 5.5% of losses, on average, from 1997 to 2003. They are more likely to be lost-time and comprise a disproportionate share of the most severe claim types. • Risk varies by type of vehicle. Frequency of fatalities is higher for trucks; frequency of nonfatal injuries is higher for passenger vehicles. • Motor vehicle accidents comprise a growing share of workers compensation injuries. Frequency is declining but at a slower pace than for workers compensation claims overall. • In terms of claims characteristics, motor vehicle claims impact a diverse range of occupations in addition to truckers (particularly salespersons and clerical). Top diagnoses include neck injuries, duration is more than 70% longer, subrogation is significant, and attorney involvement is greater. 9/17/2007 • Driver attitudes and driving practices are essential to safety, and employers can play a large part in encouraging safe practices and procedures. 9 Aon Technical Services
  10. 10. NCCI Study National Council on Compensation Insurance-Dec. 2006 9/17/2007 10 Aon Technical Services
  11. 11. Issues • Motor Vehicle Crashes are the #1 Killer of the American Work Force • OSHA • Negligent Entrustment • Employee Privacy (MVRs) • Autos not owned by the company • Defensive Driver Training • Brand Risk??? 9/17/2007 11 Aon Technical Services
  12. 12. Work Related Fatalities Census of Fatal Occupational Injuries (CFOI) - 2006 9/17/2007 12 Aon Technical Services
  13. 13. Work Related Fatalities Census of Fatal Occupational Injuries (CFOI) - 2006 9/17/2007 13 Aon Technical Services
  14. 14. Work Related Fatalities • Organizations likely spend a large amount of resources to combat the standard causes of injury and fatalities – But we tend to be oblivious to the #1 cause • Every responsible organization must develop a fleet safety program if they wish to have a top- notch safety program 9/17/2007 14 Aon Technical Services
  15. 15. What is Negligent Entrustment? • First a disclaimer – I am not a lawyer!!! 9/17/2007 15 Aon Technical Services
  16. 16. What is Negligent Entrustment? • A legal term that means you trusted someone with something dangerous, and you knew or should have known better than to trust that person. – Companies are liable for the damages caused by the untrustworthy person – “I didn’t know” defense does not work • For organizations, this occurs when vehicles (owned or non-owned) are trusted to unworthy personnel 9/17/2007 16 Aon Technical Services
  17. 17. What is Negligent Entrustment? • “More and more companies are on the firing line for N-E lawsuits, as the victims and their attys. can be assured of a larger payout if they win. Orgs. with high profiles are especially vulnerable to claims of N-E, whether they’re true or not” – Ed Dubens, Pres. Interactive Driving Systems • “The climate today is such that the law says a company that entrusts an employee with a vehicle should know if the employee is qualified to drive it.” – Jim Colangelo, V.P. PHH Arval 9/17/2007 – Dealing with Employees a the (Roulette) Wheel, Risk & Insurance Mag., April 2007 17 Aon Technical Services
  18. 18. What is Negligent Entrustment? • Examples or Entrustment: – Client appointments – Jobsite visits – Temporary or summer help run errands – Security Guards use Co. vehicles to make rounds – Driving to other company locations – Delivering equipment or supplies – Driving clients to lunch – Rental cars on business trips – Company provided vehicles…family members? – Picking up mail – Any driving actions that contribute to the organization. 9/17/2007 18 Aon Technical Services
  19. 19. What is Negligent Entrustment? • Examples of Negligent Entrustment: – Dealing with Employees at the (Roulette) Wheel, Risk & Insurance Mag. April 2007 – Socially unacceptable driving records 9/17/2007 19 Aon Technical Services
  20. 20. Insurance Carriers • Fleet Policies are no longer an option – Organizations submit driver lists & the Ins. Co. “runs” the records of most if not all drivers on the list • Overall risk does effect ins. availability and pricing. – MVRs run by Ins. Cos. (or brokers/agents) can not be shared with the insured. (Fair Credit Reporting Act.) – An unapproved driver means the Ins. Co. will not insure that driver. • Can be an issue at renewal time • Additional cost – Recent Risk: Out of 23 drivers run by the carrier, 12 were not acceptable. 9/17/2007 • Orgs. Must take ownership of the MVR process!!! 20 Aon Technical Services
  21. 21. We Must Check Driving Records! • Its the only way to determine driver safety – But he’s a really great worker… • Orgs. must take ownership of the MVR process – Consider who really needs to be a driver – Manage the list and update it frequently • Approved Driver List – A constantly updated list that reflects all authorized drivers with acceptable MVRs • Develop one…only actual drivers – Do not let the Ins. Co. dictate the process • You should know… • There should be no surprises 9/17/2007 21 Aon Technical Services
  22. 22. We Must Check Driving Records! How often? – Before hire, bi-annually, annually, semi-annually ? • Privacy? – Employee – Spouse • Ignorance is not bliss? – The plaintiff lawyers are prepared, your organization should be as well. 9/17/2007 22 Aon Technical Services
  23. 23. We Must Check Driving Records! • Where can we get them? – States: WI DOTI Program – Employees can get them – National Programs • Background Check Companies like USIS – They are obtainable • Must have employee authorization (FCRA) • There is a cost $$$ – WI $5 – MI $2 – Normally between $2 & $12 9/17/2007 23 Aon Technical Services
  24. 24. What is an “Acceptable” MVR? • Driver’s License = Safe Driver? • See: General Motor Vehicle Record Acceptability Standards • Socially acceptable driving record – Will your standards hold up with a jury? – Are you consistent? • This all boils down to: – If the worst happens, will our fleet safety program be defensible? – Or will we be forced to make it more stringent after the 9/17/2007 settlement/verdict? 24 Aon Technical Services
  25. 25. Consider using a Company Vehicle Waiver • See: XYZ Company Vehicle Waiver – They are like an umbrella. • They do not stop the rain, but they may keep you dry. • In other words, they will not keep you from being sued – but they may reduce the company’s liability. • And, since wrongful death suite can easily cost plaintiffs millions, they are work the effort!!! – Should be issued to all new drivers, updated and reissued annually with any policy changes. 9/17/2007 – Fleet safety should be in the forefront. 25 Aon Technical Services
  26. 26. What are the Components of a Fleet Safety Program? (OSHA, NHTSA & NETS) 1. Sr. Mgt. Commitment & Employee Involvement 2. Written Policies and Procedures – Seatbelts, cell phones, distracted driving 3. Driver Agreements 4. Motor Vehicle Record Checks 5. Crash Reporting and Investigation 6. Vehicle Selection, Maintenance and Inspection 7. Disciplinary Action System 8. Reward/Incentive Program 9. Driver Training/Communication 10. Regulatory Compliance 9/17/2007 26 Aon Technical Services
  27. 27. What are the Components of a Fleet Safety Program? (OSHA, NHTSA & NETS) • In addition to the DOT, State, Ins. Co., FMCSA and others OSHA is now interested in our fleet programs – Due to the injury and fatality rate, they are no longer allowing just the DOT to have jurisdiction – If your org. is inspected, expect them to ask to “review” your fleet policy – Could it be a precursor to a new standard??? 9/17/2007 27 Aon Technical Services
  28. 28. What are the Components of a Fleet Safety Program? 1. Sr. Mgt. Commitment & Employee Involvement – It must be supported: CEO, CFO, COO, V.P. of Sales, HR Director, Safety, Risk Manager, – They must agree and sign off – It must be enforceable and not just a “feel good” document • Examples: V.P. of Sales, Forman Crew – Can we enforce it if our best sales person, #1 employee or the owner’s son must be removed from driving privilages? • If not, the company could have issues in court 9/17/2007 28 Aon Technical Services
  29. 29. What are the Components of a Fleet Safety Program? 9/17/2007 29 Aon Technical Services
  30. 30. What are the Components of a Fleet Safety Program? 2. Written Policies and Procedures – Seatbelts – Cell phones and Personal Electronic Devices • What is safe use • Liability-Cell Records • Monitor Use – Alcohol and Drug Use Policy • Acceptable Use or Zero Tolerance • Acceptable BAC: .00, .04, .08, State Regs., International Regs.? • Education is key 9/17/2007 – Distracted/Drowsy driving 30 Aon Technical Services
  31. 31. What are the Components of a Fleet Safety Program? 3. Driver Agreements – Contract with all employees who driver for work • Whether they drive assigned company vehicles or personal vehicles – By signing the agreement the driver acknowledges awareness and understanding of the orgs.: • Traffic Policies • Procedures • Expectations Regarding: – Driver Performance – Vehicle Maintenance – Reporting of Moving Violations and Reportable Accidents 9/17/2007 31 Aon Technical Services
  32. 32. What are the Components of a Fleet Safety Program? 4. Motor Vehicle Record Checks – Already Discussed • Must screen out drivers with poor records. – They are most likely to cause problems • Reviewed at least annually to ensure they maintain a good record • Clearly define the # of violations and driver can have before losing the privilege of driving for work, and provide training where needed – Q: If a person’s MVR is outside the company policy, should we have them get their own car and insurance? 9/17/2007 32 Aon Technical Services
  33. 33. What are the Components of a Fleet Safety Program? 5. Crash Reporting and Investigation – Establish and enforce this process • All crashes regardless of severity should be reported to the org. ASAP • All vehicles should be equipped with an accident kit • Company fleet safety policies should guide drivers through their responsibilities in a crash situation • Crashes should be reviewed to determine their cause and whether or not they were preventable • Understanding the root cause and why they are happening, regardless of fault, forms the basis for eliminating them in the future. – Just like any other safety policy or program 9/17/2007 33 Aon Technical Services
  34. 34. What are the Components of a Fleet Safety Program? 6. Vehicle Selection, Maintenance and Inspection – Selecting, maintaining and routinely inspecting company vehicles is an important part of preventing crashes and related losses – Vehicle safety features – Routine Preventative Maintenance • Mileage Intervals • Mechanic should conduct thorough inspection of each vehicle annually-Documented • Personal vehicles may not be subject…However – About $20 for a Complete Vehicle Safety Inspection » WI State Vehicle Certification Form complete » Checks: Tires, Lights, Brakes, Coolant, Etc. Anything that 9/17/2007 contributes to the safe operation of that vehicle 34 Aon Technical Services
  35. 35. What are the Components of a Fleet Safety Program? 7. Disciplinary Action System – Develop a course of action after an incident • Assign points for crashes and violation • Progressive Discipline if a driver begins to develop a pattern of repeated violations or accidents – Defensive Driver Training » Determine a way to keep the person as a driver before they are outside of your criteria • Systems should describe specific actions that will be taken if a driver accumulates a certain # of violations or preventable crashes in and pre-defined period 9/17/2007 35 Aon Technical Services
  36. 36. 9/17/2007 ANSI Z15.1:2006-Driver Eligibility 36 Aon Technical Services
  37. 37. 9/17/2007 Driver Eligibility and Risk Levels • Point values differ from state to state. An internal system should be established to include a standardized interpretation 37 Aon Technical Services
  38. 38. What are the Components of a Fleet Safety Program? 8. Reward/Incentive Program – Helps make safe driving an integral part of your business culture – Safe driving behaviors contribute directly to the bottom line and should be recognized as such – Positive results are realized when driver performance is incorporated into the overall evaluation of job performance (performance review) 9/17/2007 38 Aon Technical Services
  39. 39. What are the Components of a Fleet Safety Program? 9. Driver Training/Communication – Seriously… • Provide continuous driver safety training and communication – Believe it or not: • Even experienced drivers benefit from periodic DDC training » Smith System, NSC DDC, VFRM, Virtual Driver Interactive – Reminders of safe driving practices and skill – It is easy to become complacent and not think about the consequences of our driving habits 9/17/2007 39 Aon Technical Services
  40. 40. What are the Components of a Fleet Safety Program? 10. Regulatory Compliance – State, Federal and International motoring laws • Speed limits • Cell phone use • Construction Zones – National Highway Transportation Safety Administration (NHTSA) – Federal Highway Administration (FHA) – Employment Standards Administration (ESA) 9/17/2007 40 Aon Technical Services
  41. 41. Promote Safety Driving Practices to Protect Your Most Valuable Investment • Your Employees!!! – Other areas of training that should be addressed via policy: • Securing Materials for Transport • Seat Belt use • Distracted Driving • Alcohol and Drug Impaired Driving-How to recognize • Fatigued Driving • Aggressive Driving • Young Drivers – Each one of these could be a training session in itself! 9/17/2007 41 Aon Technical Services
  42. 42. Conclusion • Ultimately, just like other safety programs, we must utilize and provide the proper tools to ensure the safety of our employees at all times. – Including, while they are on the road • Incorporate sound Risk Management techniques that will help provide a safe working environment for our employees and help keep the general motoring public safe – It’s the right thing to do and its good public relations – Questions? 9/17/2007 42 Aon Technical Services