Credit hire companies aren't all bad, are they?
Our “behind enemy lines” cover may seem a little strong once you view the smiley face and plausibility of credit hire boss Tony Copeland on page 24. But whatever way you look at it, there is a battle being fought on the ground.
There are two competing camps. First up, Team Corporate Insurer, complete with a messy organisational structure, a reputation for poor service and a thumping headache of a balance sheet, dictating that outsourcing should remain the order of the day.
In the opposite camp, Team Renegade Entrepreneur, who have spotted a gap in the supply chain, filled it with expert precision and exploited the inadequacies of a messy insurer system. And who can blame them? Well, some insurer bosses for starters, but many believe it to be unfair comment.
In practice, the process of providing cars to customers when they’ve been in an accident that is not their fault should be a relatively simple one. But insurers point to the hiking up of costs through operators lengthening car hire periods, providing excessively expensive vehicles and delaying paperwork. In short, some insurers believe that rogue credit hire operators are doing all this deliberately and consistently. The reality is that some probably are, some of the time. But they’re not all at it, are they?
For their part, credit hire firms say that some (not all) insurers are a nightmare to deal with. They say tracking down the right people to get decisions from within insurer empires is near on impossible, and that the roles of lawyers, third-party capture, and resource and communication failings are contributing to the problems and racking up overall costs, as well as, tellingly, hitting their own bottom line too.
So where does it leave us? Well, the ABI’s 2004 General Terms of Agreement framework attempts to mediate the problems, and a new independent chairman is being brought on board to smooth the process. There is a threat of government intervention and regulation, though, which nobody wants unless they want maximum hassle.
But, interestingly, the market is beginning to govern itself. Insurers like AA/Saga are voting with their feet and setting up their own in-house system (see news, page 10) or simply sticking with – or choosing – a tried, tested and trusted operator and getting on with it. Regardless of how good, bad or ugly you view the process to be, this must remain the most sensible, pragmatic solution. IT