Magazine article Behavioral Healthcare Executive

Steer Clear of Vehicular Liabilities: It's Never a Good Time to Cut Costs Related to Vehicle and Driver Safety

Magazine article Behavioral Healthcare Executive

Steer Clear of Vehicular Liabilities: It's Never a Good Time to Cut Costs Related to Vehicle and Driver Safety

Article excerpt

Because community behavioral health providers almost always face funding limitations, they have learned to live on tight budgets. But when it comes to managing risks wisely, even the best cost-cutters must remember that there are some cuts that probably shouldn't be made.

"With nonprofits and social service agencies, automotive and vehicle issues probably represent the biggest concern and liability exposure," says Brad Storey, director of risk management at the Irwin Siegel Agency in New York, NY. Brad started his career in behavioral health as manager of several group homes for a large organization and now counsels risk managers at a range of nonprofit organizations about strategies for minimizing their liabilities.

When it comes to automotive liability, he says that organizations often assume significant long-term expenses and high liability risks well before any employee gets near a company-owned vehicle with three common failures: failing to select and manage a group of drivers, trying to save a few bucks on initial background checks for new drivers, and failing to enforce high driving standards regularly through an ongoing safety program.

"One of the things that's common is to ask a small, nonprofit agency, 'Which members of the staff are eligible to drive?' and to hear the answer, 'Everyone.' But that approach is very costly," Storey explains, adding, "Realistically, how often is an office assistant going to be asked to drive a company vehicle?" Since commercial auto insurers typically run motor vehicle records for all covered drivers as part of their underwritingprocess, the mistakes of one driver can negatively impact costs for all. So, organizations should review and manage their list of authorized drivers to ensure that it contains the minimum required number of names.

Periodically, and within the new employee hiringprocess, Storey says that organizations must focus on driver training and monitor drivers' ongoing performances. This can be done by periodic checks of state driving records. Yet, Storey worries that "in today's economy, organizations sometimes focus on the cost of checking driver records, but not on the value. Some will argue that the cost of a record check ($7 to $20 per person) is non-essential."

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But failure to do so is a problem. "Negligent entrustment laws will vary from state to state, but they require organizations to know if there's a reason why a particular driver should not be behind the wheel," Storey says. "Let's say a driver had a DWI, or another serious infraction a year ago and just had their license reinstated. They shouldn't be transporting people around after that type of severe offense, and without the motor vehicle record check, you don't know. Nor should an organization allow a new employee with a pendinglicense check to drive. No one without a check should be allowed to drive, even for a week."

"The law says you can't entrust your vehicle to someone who's not qualified to drive it. We see a lot of claims that assert that a particular individual should not have been driving a vehicle and that their employer 'should have known' it," Storey says. …

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