Make the Tough Call

December 17, 2010

Provided by Federated Insurance

We rely on liability insurance to help pay for some mistakes that inevitably occur in the course of doing business. Some mistakes cause minor annoyances and we easily fix them and move on. Others have life-changing consequences that can't be resolved...and could have been prevented.

Serious motor vehicle crashes cause disabling injuries and deaths every day and the trend is alarming. Government agency figures and insurance industry reports reveal these major factors in many fatal accidents: speeding, recklessness, inattentiveness, and driving under the influence of drugs or alcohol. These deaths and injuries could be avoided by simply keeping unsuitable drivers off the road.

Consider these figures:
 Each day, an average of four workers dies in a vehicular accident.
 Costs for medical expenses, legal fees, property loss, and lost productivity exceed $60 billion annually.
 One in five fatal accidents involves a driver who had at least one speeding conviction within three years.
 Almost 80 percent of people with revoked or suspended licenses continue to drive.
 Drivers with suspended or revoked licenses are 3.7 times more likely to be involved in fatal crashes.
 Annually, drunk drivers kill 17,000 people and injure 500,000.

The ripple effect of pain and suffering extends to the injured or deceased person's family and friends, co-workers, business, and community.

Often too late, a business owner learns that an employee's actions jeopardize their company as well. The "Doctrine of Vicarious Liability" holds an employer liable for the negligent actions of any employee (or family member) while operating a motor vehicle owned by the company or while driving a personal auto on company business. In addition to compensatory damages, a court may also impose punitive damages, which may not be covered by insurance in some states, and criminal penalties, which are not insured in any state.

You can take action to prevent needless accidents by checking the motor vehicle report (MVR) of anyone you employ or allow to drive a company vehicle-before you give them the keys. Federated can help you set up an MVR program and offers a driver insurability service to screen your prospective drivers. It is a simple step to check a person's driving history, but a tough call when you have to take driving privileges away. However, as an owner it is ultimately your responsibility to make tough decisions. It may save your business and quite possibly a life.

Sources: National Institute for Occupational Safety & Health, Work-related roadway crashes, National Highway Traffic Safety Administration, and AAA Foundation for Traffic Safety.

This article provided courtesy of Federated Mutual Insurance Company, your association’s recommended insurer.  This publication is intended to provide general recommendations regarding risk prevention.  It is not intended to include all steps or processes necessary to adequately protect you, your business or your customers. You should always consult your personal attorney and insurance professional for advice unique to you and your business.  ©Copyright 2010 Federated Mutual Insurance Company, All Rights Reserved. 

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