Transporters support insurance policies with telematics

In SA, less than 60% of transport operators are insured.

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The South African road transport and logistics sector is grappling with high levels of uninsured vehicles, meaning owners of goods and other road users face significant liability and risk to life from non-compliant operators. Justin Manson, Sales Director at Webfleet, Bridgestone’s Mobility Company, sat down with Basil Steyn, director at A2Z Insurance Administrators to unpack some of the industry’s challenges, and discuss solutions on what can be done better.

Basil, from your experience as an insurance industry professional specialising in commercial vehicles, are South African fleets generally well-insured?

Unfortunately, South Africa has some of the lowest rates of vehicle insurance, even in the commercial sector where the consequences may be even more costly to lives and property.

What portion of transport operators on SA roads are insured?

From what we have seen, less than 60% of transport operators are insured.

Of those that are not insured, what general behaviours do you observe?

One of the most troubling behaviours is that of operators closing down their businesses, only to re-open them under new names. This demonstrates a calculated intention to evade detection and continue to act unethically.

Of those who are insured, what general behaviours do you observe, as well as measures the business takes to ensure compliance?

Even among those that have insurance, we are seeing that they don’t have enough control of their fleets. They record excessively high mileage per month per vehicle, and remuneration of drivers is calculated per kilometre, or per tonne, which inevitably leads to driver fatigue.

What are the most common risks that fleet owners face, especially that could affect insurance status?

In South Africa, crime is a major issue, both externally and internally. There are also not enough skilled drivers, and our road conditions are often not up to a good standard.

What can fleet owners do to mitigate insurers voiding policies?

A simple measure that is often not considered is to ensure that the brokers they use are transport qualified brokers.

What must fleet managers and drivers do continuously to ensure they are protected?

They need to understand the specific and changing road conditions on the roads that they need to travel. For instance, apart from the weather and construction activities, they need to know where public unrest is taking place on a given day. They need to become proactive, rather than reactive in planning routes, and they need to know where their fleet management systems may not have a signal. They need to be able to analyse information from their management systems easily for quick decision-making.

What better incentives can be offered to fleet owners to become insured?

Incentives aren’t the answer. At the very least, third-party insurance should be made compulsory, and owners of goods giving loads should insist on vehicle insurance and goods in transit (GIT) insurance, especially if the law should fail.