Grading and Excavation Contractor

Reduce Your Exposure: Manage Driver Safety

While motor vehicle crashes are not the most frequent injury on the job, they are historically one of the leading causes of occupational deaths in the United States. Between 1992 and 2001, more than 13,000 people lost their lives in job-related motor vehicle crashes.

By Daniel C. Brown

Zurich Financial Services, one of the world’s largest property-casualty insurance companies, recently examined six years’ worth of claims in its construction business group. It revealed that average auto liability costs per claim were most severe in the following three categories of motor vehicle accidents:

Rear-end collisions
Intersection crashes
Lane-change/merge collisions

Don Taylor, a senior risk engineering consultant with Zurich, states that while these are not the most frequent type of accidents, they are the most severe. “Those three types of losses drive about 40% to 70% of existing claim expenses,” says Taylor.

Safety Management Process

With an average of 1.6 claims per collision or crash, and with workers’ compensation claim costs also becoming a considerable component of these incidents, it doesn’t take long to come to an average cost of approximately $108,000 per incident.

Taylor points out that if you have an insurance policy with a sizeable $500,000 or million-dollar deductible, companies could expect to pay considerable costs per incident out-of-pocket.

“So in addition to the moral obligation they have, there is a significant incentive to do a better job managing driver and material safety in fleet programs,” says Taylor.

Human error plays a major factor in these incidents since data point to less than 3% of them being caused by a mechanical malfunction. A plan to change drivers’ thinking and behavior is critical.

Why Safety Programs Fail
“If safety is the responsibility of the safety director only—and don’t tie in safety with other corporate functions, like employee orientation, human resources, and recruiting—the success of an institution’s safety program is compromised,” says Taylor. “If an organization’s true corporate culture is to produce revenue, and safety doesn’t have a significant place on the priority list or can change as a focal point from month to month, then it’s a good bet that safety isn’t a value that permeates the company.”

A company’s drivers—including drivers of non-owned vehicles—need to know what’s expected of them. Frontline supervisors and those involved in new employee orientation need to immerse employees in the importance of safety.

“That is the first and best opportunity to communicate to an employee what is expected with respect to driver safety, and many companies miss that first opportunity to impart this important message,” Taylor says.

Employers need to be aware of their exposure to vehicle accident risks even if they don’t own the vehicles but offer vehicle allowances or mileage reimbursement plans. Many such companies may think they’re off the hook for any claims that may arise out of a collision, but that isn’t the case.

“The safety process must be managed. Safety is mostly management’s responsibility,” Taylor asserts. “Companies need to manage safety just the way they manage credit, manage payroll, and manage any other cost of the business.”

Managing safety means identifying and managing core safety processes, orientation and training, accident investigation, workplace and vehicle inspections, and employee observations. Taylor recommends climbing into the seat with drivers and watching them drive.

“The employee observation is what’s really going to drive the success of the safety program,” he says. “To get real success, you have to identify at-risk behavior, find out why the employee is engaged in that at-risk behavior, and go back and fix it.”

Effective safety programs are backed up and clearly communicated by top management, which has a role in the safety process. Supervisors have a role in the process, the safety department has a role, and so do fleet managers and drivers. People need to be trained in what their role is in ensuring safety, Taylor says. “We can’t hold people responsible for something they haven’t been trained to do,” he states.

Safety process management includes coaching and mentoring, identifying at-risk behaviors, conducting driver observations, providing the right types of training, and doing performance reviews of drivers.

“Many companies avoid doing driver performance reviews, or they’re rarely inside a vehicle to make valid assessments,” Taylor says. They may isolate oversight to a review of motor vehicle records or crash histories. “A lucky driver can still be a bad driver,” he says.

If you plan to reduce the most severe types of crashes, then you need to communicate defensive driving principles to employees. Companies need to make defensive driver training a priority.

Management needs to measure success in the safety process. Taylor favors safety incentives in terms of awards and recognition; they can be monetary rewards, public recognition when reaching safety milestone marks, or other forms of recognition. Some experts say monetary rewards can foster under-reporting of accidents.

“If somebody is looking at a chance of getting a high-value award, and they know that if they report an injury it will take them out of the running, oftentimes they just won’t report it,” says Taylor.

Fleet Safety Programs
Fleet safety programs need to be drafted and formalized. For many companies, a fleet safety program isn’t viewable; it’s all in somebody’s mind as a philosophy. Taylor says, “You have to be able to touch the safety program, to read it, to put it in the glove box and refer to it. And I think it’s a good idea to have a knowledge retention test on the program. This enables an employer to produce a document that says employees were tested on the knowledge of the program, which can be useful to mitigate future claims.”

The fleet safety program needs to communicate those drivers who are authorized and those uses of vehicles that are permitable.

If such policies are not written down, employees may assume they can use a vehicle for non-work-related purposes.

“If I have a company pickup, can I use it to take my boat to the lake?” asks Taylor. “If our expectations have not been communicated, employees will assume they can take liberties.”

If you have a vehicle allowance plan or mileage reimbursement program, you need to set the minimum level of liability insurance that you expect employees to carry on those vehicles.

In some states, the legal limits are much lower than employers would prefer.

Employees can carry low levels of liability—which can easily be exhausted—and the remainder of the liability will revert to the employer. “But if I’m an employee required by the company to carry $300,000 to $500,000 in coverage, that initial layer of protection is increased,” Taylor says.

He believes in setting standards for drivers and in hiring only the best.

“One particular large retailer has a track record of hiring quality drivers,” Taylor says. “The company’s truck-driving positions are highly sought after, and the drivers are compensated beyond industry standards. The company drivers are easily identifiable, thanks to a uniform dress code, and its drivers are encouraged to adhere to speed limits. We’ve found them to be rated as a very safe company. And the organization doesn’t waver from its expectations.

Daniel C. Brown owns TechniComm, a communications business in Illinois.

GEC - November/December 2007

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