Accident management has proven so successful that all major fleet leasing and management companies now offer this service and several have enrolled more than 20 percent of their fleet vehicles in accident management programs. In addition, fleet management services companies have expanded the size, scope, and sophistication of their accident management programs directed at business fleets.

Accident management programs developed by fleet management services companies and the major lessors are designed primarily for businesses that self-insure for collision and comprehensive type claims.

Self-insured companies have a vested interest in every vehicle collision dollar while those with full insurance coverage are concerned dollar while those with full insurance coverage are concerned primarily with their annual insurance premium.

"It usually gets down to the philosophy of the company" says Shaun O'Neill, assistant vice president of fleet management services for Wheels, Inc. "If accidents are viewed as a risk management issue, that company will probably use an insurance company. If they see it as part of fleet management, then accident management programs will be considered a fleet responsibility."

O'Neill says fleet managers can make a strong case that accident management should be a fleet responsibility.

"We're more oriented to the vehicle - getting it repaired properly, expediting parts, checking to see that the repair bills are reasonable and getting the driver back on the road as soon as possible," O'Neill says. "Others see it as managing a loss. They are not as concerned about driver productivity."

Mary Sticha, director of accident services for GE Capital Fleet Services, says a good accident management program will not only curb costs at the time of an accident but, by assuming that repairs are made properly, will more than pay for the service in used vehicle resale results.

"Last year, vehicles enrolled in our program averaged several hundred dollars more in resale than like vehicles that wee not on the program," Sticha says. Vehicles not on the program may have sustained minor body damage that was not repaired or may have been repaired improperly, she says, adding that this type of neglect proves costly at resale time.

With competition for accident management business so intense, the pricing for the service is fairly uniform. Most providers will charge approximately $2 per vehicle per month or at the fleet's option, a per accident charge ranging from $65 to $120, depending on the size of fleet and services offered.

"The objective is not to focus on repairing bent metal. The objective is to reduce the number of accidents," says Ron Dapkunas, director of accident management programs for PHH FleetAmerica. "The typical accident may cost $1,600 in repairs but we calculate that, in terms of lost time, lost sales, product destroyed and workers' compensation claims, it costs $9,000 to have an accident."

The fleet manager interested in selecting the best accident management provider would be wise to focus on the major elements of the programs they offer. But the selection process is as much art as science, the accident management companies contend. You can't just compare statistics to pick a winner.

"Statistics can be misleading," says Wayne Smolda, president of The CEI Group. "For example, if someone claims that they recover much more than 90 percent of what is subject to subrogation, that really needs to be examined closely by the fleet manager. You would first want to see what percentage of total claims they determine to be subrogatable. If they low-ball this 'determination rate' then their recovery rate isn't valid."

"The numbers really flow around in this business," says Ron Starr, vice president of Consolidated Service Crop. "When you start comparing average cost of repair and average subrogation recovery, you better know what you are comparing. Some fleet managers can get misled. Others, of course, know the facts.

Starr recommends that fleet managers focus first of all on the reputation of an accident management provider. Ask a provider's clients what they think of their performance he says.

Instead of dwelling on statistics, the fleet manager should ask about the quality and training of the staff, the established procedures, and the reporting ability of the accident management provider, Starr says.

Having a trained staff specializing in a specific field is, of course, a major advantage of the accident management providers.

"All of our people have the necessary certification, training, and experience to do the job," says Gary Taylor, director of fleet management services for U.S. Leasing Fleet Services. "Naturally, we have specialists who take the loss reports and negotiate with the body shops and others who deal exclusively with insurance companies on subrogation matters. Every accident-related detail is handled by experts, from getting the car towed to expediting repairs, processing bills, and pursuing third-party recovery claims.

"Most in-house fleet managers do not have the time or the resources to obtain the cost-savings that an experienced accident management company can bring," Taylor says. "This is especially true in the crucial area of subrogation, where knowledge, persistence, and determination really pay off."

Subrogation is the principal reason for the growth of accident management programs, most of the providers agree.

"Handling the accident paperwork is not a big deal but subrogation presents the potential for a big investment of time," says Wheels' O'Neill. "If the accident was your driver's fault, you just pay the damages. But if it was not his fault, you pay to get it fixed then try to collect damages. And if you are not good at subrogation, you are leaving a lot of money on the table."

Most fleet administrators, understandably, would rather contract out subrogation than do it in house, O'Neill says.

"It's distasteful," he emphasized. "Chasing people down, sending dunning letters. It's not a pleasant task."

Persistence in subrogation is what pays off for the recovery specialists.

"We have a 13-step process that's rather straightforward," says GE's Sticha. "You identify who is at fault, present them with the bill and pursue it." GE succeeds in more than 90 percent of its subrogation cases, she says, returning $4 million annually to clients who have some 80,000 vehicles in GE's program.

Sticha says that 95 percent of the time her staff is trying to collect from insurance companies on subrogation matters.

"If you can't 'talk the talk' they know it immediately," she says.

Dave Lodding, director of fleet management services for Donlen Corp., says that without a persistent, experienced staff, subrogation battles often fail.

"It's surprising to me that a number of fleet managers don't even pursue damage claims," Lodding says. "They just don't have the staff in place to follow up. Now if someone caused $2,000 worth of damage to your personal car, would you walk away or go after them? The percentage of recovery in subrogation is very high but it does take time and fleet managers wear a lot of hats."

CEI's Smolda says his firm will pursue subrogation cases for up to two years before throwing in the towel.

"If your accident management provider isn't pursuing subrogation cases into the second year, they are giving up too quickly," Smolda says. "The fleet manager should ask how long subrogation cases are pursued."

All of the accident management providers have established national networks of repair shops and refer all of their collision business to the shops on their list. They work closely with these shops on pricing, quality of repairs, and service.

Sal Crimi, president of Salex Fleet Specialists Corp., says the situation today is a far cry from the early 1970s when Salex was a pioneer in the accident management field.

"The auto repair industry would get one black eve after another," Crimi says. "Monitoring is the key. With some shops, as long as they can get away with something they are going to do it. That is why each estimate we receive is reviewed using our computerized estimating system to ensure the lowest possible repair cost."

Today Salex has 30,000 maintenance and body shops in its network. Each shop meets established criteria, has a good reputation through the local Better Business Bureau and Chamber of Commerce and, most importantly, has a track record of satisfying Salex customers.

"If they fail to perform up to our standards, we remove them from our network," Crimi says.

GE Capital, with more than 40,000 body repair facilities in its network, uses a strict rating system based on capabilities and performance, says GE's Sticha.

"It's an on-going process," Sticha says. "We monitor the shops in a variety of ways, but the best input is from the drivers once the work is completed."

CEI's Smolda says his firm's carefully-chosen network of 2,000 body shops is more than adequate to handle accidents involving the 105,000 vehicles in the CEI system, the industry's largest.

"If you can't motivate a body shop owner with a good volume of business, he could care less about you," Smolda says. "Your relationship with the body shops is very important in this business. Lots of sins can be hidden there if you are not careful."

Accident management providers also monitor the repair process from initial report and estimate to completion of the job. GE does spot re-inspections as part of its monitoring program. It provides re-inspection service at the customer's request for a fee of $25.

"The initial estimate is just the starting point," says U.S. Leasing Fleet Services' Taylor. "We will review it thoroughly to ensure that 'like, kind, and quality' (LKQ) replacement parts are being used, and to screen for 'over-sold' items which a driver or fleet manager with limited technical expertise cannot always recognize. We also seek out cost-saving repair alternatives."

But as accident management providers have built their business on reducing the cost of accidents, they also are quick to emphasize that the best results can be obtained by reducing accidents.

"Safety makes good business sense" says Ed Kemps, manager of Insurance Services for ARI. "Not only do you get a lot of good will from your employees by showing concern for their safety but you also can save a great deal of money."

"I've been in the insurance business for 30 years and I can tell you that if you initiate a comprehensive awareness program with some meat to it - one that is on-going and emphasizes to everyone that your company cares about you and your family - accidents can be reduced 10 to 15 percent each year over two years. Lower loss history levels off at about 30 percent. You may do better but 30 percent is almost guaranteed."