Reducing the Risks of Using Agency Drivers

Picking a good transport driver agency

For some transport companies, agency drivers are a vital component of a flexible workforce. As with any workforce, some are excellent, others are less so. The question some hauliers ask is what can be done to minimise the risks associated with deploying agency drivers.

We recommend that transport companies only use the services of driver agencies that are Recruitment and Employment Confederation (REC) members and who follow the code of practice drawn up by the REC Drivers Group in conjunction with the RHA and FTA. This code of practice places obligations on both the driver agency and the firm that's engaging the services provided by the driver agency.

From the haulier's perspective, key benefits of using drivers supplied by a REC Drivers Group member include knowing that the driver agency has:

• Made every reasonable effort to ensure that drivers comply with relevant legislation, in particular the drivers' hours and tachograph rules.
• Taken up relevant occupational references covering the previous two year period of employment, particularly checking periods of unemployment so far as practicable.
• Checked drivers' licences, regularly re-checks them and, if a driver does no work for the agency for a period of more than three months, carries out further licence checks.
• Kept appropriate records of drivers to be supplied, including past experience, qualifications and references.

What should not be overlooked is the need for the transport operator employing an agency driver to still follow the relevant induction procedures that they would normally adhere to when taking on a new full-time driver of their own. If an agency driver is not properly briefed and made fully aware of what is expected of him or her before getting in a cab, the operator should not be surprised when the unexpected happens.

Using drivers' negligence insurance

Using agency drivers can be a great way to give your business flexibility. While this can result in a higher number of claims, there are steps you can take to protect your business from claims of this type. 

A majority of driver recruitment agencies can provide what is known as 'drivers' negligence insurance', usually as an extension to their public liability cover, to protect their customers against claims for accidental damage to trucks caused by the negligent acts of drivers they supply.

Drivers' negligence cover is only provided if the transport company has made the agency contractually responsible for such damage. This is in accordance with the REC/FTA/RHA Joint Code of Practice for Agency Drivers which states that "should REC members offer drivers' negligence or fidelity-bonding, this must be set out in a contractual document which must be signed by both parties before the assignment begins."

Drivers' negligence cover is typically limited to either £5,000 or £10,000 any one event and to between perhaps £30,000 and £50,000 any one period of insurance. An excess of perhaps £500 or £750 may be typical. Depending on what the contract says, some agencies may themselves offer to pay the excess in the event of one of their drivers causing damage to a customer's truck.

Care needs to be taken to ensure that the drivers' negligence cover does not restrict the size of vehicles being driven, nor the territorial limits which may, for example, need to cater for trucks being driven abroad.

Finally, transport companies hiring agency drivers from agencies that provide drivers' negligence cover still need to arrange motor insurance in the normal way given drivers' negligence cover excludes injury to third parties and damage to third-party property - as well as only providing limited cover for truck damage (see above).

Goods-in-transit security

Transit losses in the haulage industry through theft and damage have increased considerably over the last few years and insurance premiums have risen as a result.

Reducing your exposure to transit losses should improve your claims experience. As well as cutting the hassle of dealing with claims, your premiums may be lower too. By making sure sound procedures have been introduced to minimise the risk of transit losses, not only do you cut the risk of claims; more importantly still, you protect your reputation with your customers.

Have a look at our dedicated article for more information on goods-in-transit security.

This is a marketing article by Towergate Insurance.

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About the author

Chris North FCII is a respected industry leader with over 40 years' experience, who has worked in the insurance industry in a variety of roles, accumulating a wealth of knowledge. He is currently Technical Manager for Towergate's motor division, providing expertise on all matters relating to motor fleet insurance, in particular haulage and self-drive hire fleets.