The industry whose risk management record must be improved

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An Australian insurer has called for urgent action to improve one industry’s shocking risk management record. Should you be concerned?

Lumley Insurance is stressing that the fuel transportation industry needs to increase their risk management practices to reduce the risk of accidents involving fuel tankers.

Over the past two years, the insurer has seen the number of major crashes involving the fuel transport industry increase by 30% compared to the previous two years, while the cost of these crashes to insurers has increased by over 90% in the same period. More specifically, over 40% of insurance claims relating to fuel tankers are due to rollovers at roundabouts.

“What is most concerning is that there are no signs of improvement,” said John Nagle, chief executive of Lumley Insurance. “The fuel industry needs to step up their efforts to ensure that this stops.

“While there are valid arguments about roundabout engineering and road cambers not being conducive to truck stability, legitimate questions need to be asked about the training and skills required to drive fuel tankers.

“With the cost of accidents relating to fuel tankers costing tens of millions of dollars per year, the fuel industry needs to implement effective risk management training not just to reduce the amount of accidents or even to reduce their insurance premiums but to increase the safety of our roads for everyone who uses them,” said Nagle.  

Lumley have been liaising the industry on this issue, and recommend:

  • Improved driver safety training – mandated to multiple times per year with a focus on operating heavy vehicles with care and consideration
  • Driver attitude training to deal with the frustration that comes with driving long distances
  • Safety placed before time constraints with incentives provided for driver safety record
  • On-board cameras to monitor the road and the driver, with the footage captured, used to educate drivers
  • GPS tracking of trucks so that companies can monitor the speed of their drivers
  • How’s my driving?’ stickers on the back of vehicles for the public to report poor driving behaviour.
  • Rosters similar to that of the airline industry where drivers aren’t allowed to drive unless they have had a certain amount of rest.

“These suggestions are just to name a few,” said Nagle. “The industry needs to acknowledge that if safety standards don’t change, insurers will have little choice but to increase prices and deductibles significantly to cover the cost of these accidents. Furthermore, the capacity of insurers to underwrite fuel risks may also be limited to writing risks that can demonstrate good risk management processes.

“The cost of accidents caused by fuel tanker rollovers isn’t just a financial one. It’s now time for the fuel industry to do more to ensure that they are improving the safety of our roads for ALL road users,” he added.

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