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4/16/2012 8:00:00 AM Write a Letter to the Editor Write a letter to the Editor

Opinion: Outsourcing Accident Management

• Audited estimates that generate documented savings. Some accident management companies employ an in-house staff of licensed physical damage appraisers whose job it is to review estimates for price and quality and to negotiate with network shops. It’s these reviews that have been documented to save anywhere from 3% to 10% or more on individual repairs.

• Reduced towing expenses. Some provider networks offer coast-to-coast coverage, so that client vehicles are never very far from access to a qualified truck repair center.

• Reduced vehicle downtime. Because network shops are dealing with an accident management company that regularly sends them business, they deliver expedited priority service that a single fleet may not be in a position to secure for itself. This has the benefit of reducing or eliminating shop storage expenses and minimizing the expenses for rental replacement vehicles or the strain on a fleet’s ability to supply its own temporary replacement vehicles.

• Comprehensive Web-based reporting. Accident management service providers have invested in sophisticated, Web-based systems that collect and report accident program data for client fleets. Data can include digital files on every claim, including all basic claim information, photographs, police reports, witness statements and estimates. The systems also deliver a wide range of reports that enable fleet managers to identify trends in expenses and the types and causes of accidents, at a variety of organizational levels — and all in a matter of seconds.

• Improved loss recovery. Some accident management companies employ staff members whose only job is to pursue the recovery of damages for client fleets. Few fleets can afford the luxury of such a department. Accident management subrogation departments often identify opportunity for loss recovery in 20% to 30% of all accidents — and recover more than 90% of the dollars they target.

The hard-dollar savings alone from outsourcing accident management can be substantial. In 2009, for example, the average cost to repair a large truck that had been involved in a property-damage-only collision — one without a fatality or injury — was nearly $22,000. In a fleet with 10 such accidents, the total bill could reach $220,000. Recovering 90% of the damages from three of those accidents could reduce those net expenses by about $63,000, and saving just 5% on repair costs could trim another $11,000 — for net savings of $74,000. And that doesn’t include the additional soft-dollar savings of creating more time for the fleet department to devote to other tasks, as well as the time saved by getting the vehicles back on the road days sooner.

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