How to lower Average Repair Costs

The Mission Statement of RVM Fleet Services says we are in business to reduce both the frequency and cost of accidents. We regard both these features of claims history as equally important (especially when negotiating to buy motor fleet insurance) and we apply different tools for tackling each.

Our work in reducing frequency through our Full Circle risk management program is gathering pace and in the fleet market is now recognised for its uniqueness and effectiveness.  Our work in reducing accident costs is, however, equally unique and equally effective.  

A few home truths

Before we take a closer look at how RVM is tackling the rising cost of accident repairs, it would be useful to set the scene by looking at a few home truths:

• There is a continuing fascination and focus on labour rates when in practise the larger element of an accident repair bill relates to parts
• Many vehicle manufacturers have tightened their wholesale discount structure on parts, which has restricted fleets ability to reduce that element of the repair invoice
• As a result, Fleets are scrutinising their decision-making in terms of what to repair and what to replace and balancing that decision against the need to remain legal and safe 
• The fitting of non-original-equipment can contravene the terms of a leasing agreement, result in lower residual values and compromise safety and performance
• Many claims management companies derive a large proportion of their income from the repairer by agreeing a level of introduction fee with the repairer that increases the invoice value

Additionally, the calculation of a figure for average repair cost can be rendered meaningless unless:

•  It includes all repairs performed for a particular fleet in a particular period
•  It includes all types of damage repair cost such as smart or express repairs
•  It excludes repairs performed outside a body repair environment such as glass only
•  It excludes claims where there was no damage recorded
•   It excludes claims where damage was recorded but not carried out

The benefits of reducing repair costs

If fleets can reduce their average repair costs they are more likely to be able to stabilise or ultimately reduce their motor fleet insurance premium.  Alternatively, in those circumstances, a fleet may feel more confident about increasing the policy excess or selecting to buy only third party cover.

At RVM Fleet Services we have three major fleets that currently enjoy average repair costs of between £600 and £700 per repair, which represents approximately two thirds of the average repair figures being quoted in the marketplace. 

How we reduce the costs

1. Each new claim is assessed and managed by regarding the vehicle as our own and we therefore adopt the most cost-effective repair or replace strategy given the range of options we have available to us and given the constraints placed upon us by the client fleet

2. We repair the vehicle using recycled parts and body panels from other identical vehicles creating parts savings of up to 80% in some cases and  the parts are therefore 100% original equipment. Apart from reducing average repair cost, the other benefits of this approach are as follows:

a.       RVM and its fleet clients can demonstrate the most green approach to repairing accident-damaged vehicles

b.      Vehicle downtime is reduced because parts can be supplied quickly and even on consignment (often in the right colour)

c.       Fewer vehicles are written off because the total loss equation swings in favour of repair

d.      Parts and panels from vehicles that are written off can be re-used (including specialist equipment)

e.      The process of recycling these parts is carried out in a 100% carbon neutral process

Find out more...

If you would like to talk to RVM about how to reduce average repair cost then please get in touch. Call us on 0113 224 8888 or send an email to info@rvmfleetservices.co.uk. For more information about our Full Circle program click here.