Editor's Note

Fleet management men who have been assigned the responsibility for fleet insurance have encoun­tered a most difficult task.

Our field contact has underscored the mounting problems inherent in developing and maintaining a good sound relationship with a carrier as well as a method to "insure" stable rates and good claim service. No other single phase of fleet management appears to be more volatile, cause more concern and still remain so unmanageable in terms of rates.

Our feature story is specifically designed to evoke a keen awareness on the part of our readers and the bet­ter commendations that should be followed to mini­mize the current and future problems that are sure to occur.

Of particular significance today is the first class fiasco that is taking place in the State of Pennsylvania with the taxi cab industry. The exercising of the small print paragraphs to terminate contracts and the whole­sale revision of spectacularly higher rates has caused such demands on the operators that a number are now either virtually out of business or have found it neces­sary to diminish their fleet substantially. To make mat­ters worse, the carriers appear to have all found the new course of noticeably higher rates at the same time.

Also difficult to understand is the insurance com­pany attitude when a company changes from company ownership, or salesman ownership, to leasing. There almost always is a reported reluctance and re-evalua­tion by the carrier when the leasing company observes that there has not been the slightest change from a standpoint of accident exposure by the same drivers. Neither the driver individually nor the company ex­periences any problem in covering this same man in the same car covering the same territory but the prob­lem suddenly becomes difficult when it comes under a lease.

Many carriers assume that one of the main reasons for leasing is that the company can hide all the delin­quent, accident-prone drivers under an umbrella called "leasing insurance." This simply is not so. Both the fleet manager and the leasing company can and do offer a greater degree of selectivity than is normally obtained because of the charged interest in safety and economy.

Other obvious insurance problems are the various state requirements that are identified in our Tax, License and Insurance Chart (pgs. 43-42, October, 1967 AF). Just consider the compulsory insurance and financial responsibility laws alone.

All fleet insurance policies must be on a calendar year basis so as to coincide with license plate renewal periods in Illinois.

Insurance is required to be carried in the lessor's name regardless of whether or not the lessee is also insured in Connecticut.

Massachusetts requires certification by an insurance company on each application for registration of any car (new car or a renewal).

In North Carolina and New York an FS-1 form must be used each time a car is registered.

Maryland asks that the carrier file a special form with the Department of Motor Vehicles the moment the first leased car enters the state.

In Virginia, a driver must have the name of his in­surance carrier, the policy number and the expiration date of the policy in his possession in order to register his car.

With relatively so few insurance carriers specializ­ing in fleet insurance ... all being large influential companies. . . I believe that these companies should make a concerted effort to standardize their own pro­cedures in connection with insurance. The fleet man­agement man can aid in this cause by relating his per­plexed feeling to insurance company management.

Insurance is a major cost of operation. It involves almost endless paperwork and lost time for claims and accident repairing as well as the constant checking for the changing requirements in each state.

Every fleet and leasing management man should make the conscious effort to examine the insurance in­fluence cost in obtaining needed service and make his reactions known.