Risk Management Flashcards
How are your Reserves calculated and what is our reserve goal?
12 month rolling average of “on rent” losses (LPU), plus 10%, divided by your fleet. Goal is $18/unit.
Before re-renting to someone who has just returned a vehicle with damage, what things do you want to consider?
Liability & Collectability. i.e. who was at fault, was there serious injury or death, was there a contract violation, does the renter have transferable insurance coverage to cover this loss or subsequent new losses, is the renter cooperative, did the renter pay his deductible, etc.
What are some methods you can do at the branch level to decrease your reserves?
Proper underwriting, proper vehicle selection, complete damage reports (renter insurance information, claimant and witness information, police reports), collect deductibles.
What is a conversion and what steps do you take on one?
When you lose control of both the renter and the vehicle.
· Who to notify: Area Manager 1st, then loss control immediately
· Conversion Check list: Complete it.
· Demand letter: After all efforts to recover the vehicle has been exhausted and
· it is deemed out of control.
· How it is sent: OR: By any commercial carrier that can provide a delivery receipt. WA: USPS certified mail. Establishes non-permissive use and helps to release Enterprise of liability responsibility for rental.
· When to report stolen: When authorized by LC manager or GM only. OR: Must wait minimum 3 days from confirmation of delivery/inability to deliver demand letter. WA: Must wait minimum 5 days from date letter is sent.
· When to close contract: 5 days after the demand letter is sent..
· When does a converted car come off books: 30 days after the demand letter is sent..
· Which account: 557 uninsured loss
· How much is expensed: wholesale value to branch, nothing is spread.
When can a recovered stolen car be put back into service?
5 days after being taken off the hot sheet and after confirmation that the loss control department sent the police department a letter documenting the recovery of the vehicle.
What is a subrogatable claim and how does it affect your branch?
A claim that we can collect on. If collected, no impact, keeps Reserves & LPU low.
If not collected, raises LPU and Reserves.
- How does an employee at fault accident affect your branch, city, and group?
ERAC physical damage: First $2,500 to branch, next $10,000 to city, balance spread to group.
3rd party liability: First $2,500 to branch, next $10,000 to city, balance up to $25,000 to group, any amount above $25,000 spread to corporate via the casualty fund.
Max to a branch is $5,000 plus their portion of the spreads.
5. What six situations would expose ERAC to unlimited liability and give an example of each?
Negligent entrustment, negligent maintenance, false arrest, 3rd party disclosure, employee loss, and employee assault.
What six situations would expose ERAC to unlimited liability and give an example of each?
Negligent entrustment, negligent maintenance, false arrest, 3rd party disclosure, employee loss, and employee assault.
VR). What can you do to decrease your maintenance expenses?
Ensure that LOFRs are done as soon as possible and that units needing LOFRs are actively switched out. Ensure that rewrites are done monthly and closed out with accurate mileage. Use national vendors whenever possible. Check the tires for tread depth and proper inflation between rentals. Checking tires for nails, flats and wear at check in and check out.
What do you do when a customer calls looking for a handicap equipped vehicle and how do we comply?
Normal rental qualifications and rates apply. No extra fees can be charged. Must rent per the ADA. Must provide “reasonable accommodations”. Must rent to blind persons. First offense fine is $75k. We do not require more than 48 hours advanced notice for reservation of vehicles with hand controls at any of our branches. Direct any mobility device inquiries and reservation requests for all brands to the Contact Center for coordination:
Alamo
How does re-renting a damaged vehicle affect your branch and our group?
ESQI. Negligent maintenance, harder to sell DW, turns a subrogatable loss into an uninsured loss, marketing issues, could increase liability loss, etc.
Explain PAI, what it covers, and how much we charge for it per day?
Personal Accident Insurance
Renter: $100k accidental death, $3.5k Medical coverage, $150 Ambulance. (Covered inside & outside of the rental vehicle 24/7)
Passengers: $10k accidental death, $3.5k Medical coverage, $150 Ambulance. (Covered inside the vehicle only)
$3/7 dollars a day. ($7 – 10 persons or more)
What are some methods you can use at the branch level to decrease uninsured losses?
Trunk to trunk check in/out, hold customers accountable for damage, train employees on what damage to look for, re-assess vehicle lot staging, block in lot at night/lot security, make sure we have appropriate lighting, use the damage Evaluator clipboards, no keys left in vehicles or in the wash bay, etc.
Who handles our damage vehicle claims and what is the responsibility of the branch?
Damage Recovery Unit
DRU1 handles airport claims – located in Tulsa, Oklahoma
DRU2 handles home city branches – located in Fort Collins, Colorado
The branch must include every detail including: who, what, when, why and how when completing the damage report.
Provide the claims instructions to the renter
Collect the deductible when the customer did not purchase our coverage
Get the damaged vehicle to the shop immediately
What is the difference between an uninsured loss and a reserve loss?
Uninsured: Not on rent/DR loss. i.e. Conversion, Employee loss, Lot damage, Undocumented damage, detectable fraud.
Reserve loss: On rent/DR loss. i.e. a loss while on a DR, generating income, regardless of DW.
