Loss History

Loss History refers to the frequency and average costs of past crashes, and is often used by Insurers to determine the acceptability and price of an insurance program. Past losses are an accurate statistical measurement of the exposure faced by a company, and how well they manage or control these exposures. When the frequency and average cost of incidents has an increasing trend, this would normally indicate that the management or controls are deteriorating or severely lacking. A decreasing trend usually indicates that management controls have improved.

Negative Positive
 
High frequency (>20% of fleet) of motor vehicle losses. Loss lessons are used to create improvement opportunities.
High severity (US$>20-<50k average cost) of motor vehicle losses. Individual Loss KPIs directly drive Individual performance plans which are tied directly tied to compensation.
High frequency of driver "at fault" motor vehicle losses. Low frequency of driver "at fault" motor vehicle losses.
No tracking / monitoring of motor fleet loss history at a management / organisational level. Well established tracking / monitoring of motor fleet loss history at a management / organisational level.

Establish tracking / monitoring of motor fleet loss history at a management / organisational level (i.e. for individual business units as well as the total organisation). As a start, key performance indicators to monitor are;

  • Loss frequency (total number of losses per total number of vehicles in the fleet per annum)
  • Average cost of loss (total cost of all losses divided by the total number of losses per annum)
  • Driver at fault frequency (total number of driver at fault losses per total number of losses per annum)
  • ‘Repeat offender’ losses (individual drivers with more than one loss over a rolling five year period)

For higher levels of tracking / monitoring all of these performance indicators should also consider kilometres / miles driven.