Everyday equipment fleets are not rushing to integrate machine data, but that decision may be coming sooner than expected or desired. The impetus may end up coming not from organizations looking for improved maintenance operations, owning costs, or production efficiencies, but rather from the compliance department.
In Walt Moore’s Special Report on peer-to-peer rental apps, which are designed to connect fleet managers in an Uber-like sharing economy, renter fleets voice concern about insurance for the rented machine once it is in someone else’s hands. Who pays if the renter damages or incurs liability with the owner’s machine?
Automotive and on-road trucking fleets have seen insurance rates escalate in recent years, as costs increase faster than premiums. The Wall Street Journal recently reported that commercial auto-insurance companies spent $112 for every $100 in premiums collected in 2016, citing investment-management firm Conning Inc. Some trucking firms face the loss of insurance as accidents increase. The reasons for the increase range anywhere from inexperienced drivers to using smartphones while driving to inceased volumes of truck traffic during peak driving times.
As Moore reports, some peer-to-peer apps use machine data to monitor usage and location, with one going so far as insisting that a data-collection device be installed on any machine rented. Trucking and automotive fleets are being pressured to monitor their vehicles, also.
Usage-based insurance has been gaining ground for a couple of years on the consumer side, with companies offering discounts to drivers willing to install or allow access to onboard data-collection devices. Insurance firms are now asking trucking operations to take similar steps.
What affects truck fleets often presages changes coming to off-road fleets, and the movement in the insurance industry is certainly worth considering. Off-road fleets have access to machine data, including some linked directly to operator behavior, and insurance companies know this. Geo-fencing is certainly a technology that an insurance company would consider worth a discount.
But what about other technology, such as obstacle-avoidance systems and personal-protection equipment, that might soon gain the attention of insurance companies? Equipment managers should consult with their in-house compliance departments. Technology that enables collection and integration of machine data for production and fleet management may also allow an organization to reap rewards on the insurance side.