First Notice of Loss, better known as FNOL in the insurance, fleet and transportation management industries, is the first report to an insurer about the damage, loss or theft of an insured vehicle. As such, it is the very first step in an insurance claim process.
Additionally, FNOL is a widely used term in telematics and telematics data management. Here, it describes the automated alert that is triggered by readings (about a vehicle’s g-forces) within a telematics device – be that an older black box or a newer camera.
These alerts help fleet managers by letting them know an incident has happened. They can then rapidly react to manage the situation by checking on the safety of the driver and any third parties, notifying insurers or emergency services, updating customers who may be impacted by the involved vehicle’s situation, etc.
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The Drawbacks of Technology with FNOL
Unfortunately, telematics devices are very sensitive, reacting to all sorts of nudges, bumps and bangs on a vehicle. This triggers a lot of false positives to fleet managers, who eventually stop reacting to every alert – as they could be caused by a door being slammed, driving over a pothole or hard braking from taking an unfamiliar corner too fast.
This, of course, can create a situation where a true incident that requires a FNOL can go unnoticed. The reaction only comes when the vehicle driver notifies the fleet manager, which could be at the end of a shift or even later.
Why Is Rapid FNOL Important?
First, the safety of all involved is critical, and in cases where major injury or loss of life is likely, the need for rapid FNOL is paramount.
However, in non-life-threatening or non-major injury incidents, the faster a fleet manager or insurer can react to an incident, the better they can take charge and manage the associated cost elements. This allows them a better chance of keeping costs under control.
In the late 2000s, a leading car rental company ran a campaign to get its renters to call a dedicated helpline should they have an incident. By doing this, the company could take control of the incident – managing it with its own resources while also providing better peace of mind and service to its customers and any involved third parties.
This campaign was based on the company’s analysis that showed the cost of an average incident – repairs, provision of replacement vehicles, insurance elements, etc – could be kept under $400 if internally managed. If third parties became involved – other insurance companies, accident management organizations, replacement vehicles hired from other (often competing) car rental companies, etc – the average cost would increase to almost $4,000. Tenfold increases like this, as well as vehicle downtime, impact customer service and can negatively impact insurance rates.
This is why fast, accurate FNOL is so important to fleet managers, companies and insurers.
How Can FNOL Be Improved?
The need for fast and accurate FNOL is important in preventing loss of life and improving cost control. However, the tools for fast and accurate FNOL – telematics – are flawed in providing accurate FNOL. So what can be done?
Innovative technology has solved the conundrum of the need for fast and accurate FNOL without the forest of false positives from the telematics devices used by fleet managers and insurers.
This technology is hardware agnostic, taking in data from any telematics, employee or other connected data sources. It then makes the data consistent and comparable, over time and across original sources, via AI and machine learning-based technologies. This delivers the time-critical FNOL alerts that are needed by fleet managers and insurers. Plus, it provides a simple, single point of view of an organization’s risk profile.
With this, organizations can reduce claim frequencies and costs, improve the effectiveness of training programs and significantly reduce or eliminate manual data management.
Want to learn more about how you can get more out of your telematics and other driver data? Download our Telematics Optimization Playbook for our top tips.
