The frequency of theft has actually fallen by about 50% over the past five years thanks to improved vehicle and premises security. But the average cost per incident has risen by half, according to estimates from Norwich Union.
Theft ranges from the opportunistic – stealing of keys left unattended is the biggest issue in terms of frequency and cost – to the planned and, sometimes, vicious, such as security guards threatened with handguns.
A range of security options
A growing number of larger dealer groups are accepting a greater degree of self insurance. They are carrying more risk themselves rather than face higher insurance premiums.
Finding a method that works is crucial. There are plenty of options, including CCTV, monitored CCTV, manned guards with dogs, fences, alarms, electronic gates, keypads, heat sensitive lighting and drop down bollards.
Though a large number of car thefts from showrooms occur as a result of keys being stolen during business hours, retailers also have to deal with vandals who usually strike when the dealership is closed.
Outside business hours most dealerships have physical security measures such as ram posts, gates and wheelclamps. Barry Hogg, underwriting manager for motor trade and agriculture at Norwich Union, claims that these do little more than simply “buy time” when thieves are looking to steal a vehicle, however.
“They should ideally be backed up with a remotely monitored CCTV, intruder alarm system or perhaps manned guarding. By these means you can be alerted to an attempted theft in its early stages and by responding have a good chance of preventing it,” he says.
Colt Mid West (CMW), Mitsubishi UK’s own retail group, already uses CCTV to protect its sites but is now introducing monitored CCTV.
“Security is a very important part of our group and though the new system is a big investment upfront it gives long-term gains,” says David Hanna, business analyst at CMW.
The group is using monitored CCTV at three of its eight sites. “The footage is monitored 24 hours a day by Allcooper Security, which supplies the system. This gives us much better coverage and means there is always someone on standby should an incident occur,” says Hanna.
“For us it’s been excellent working with one supplier. They know our requirements so if we open a new site they can just work from our blueprint. It cuts time and costs.”
The group also uses Redcare, a service offered by BT backed by the local police. Hanna explains: “If there is dual activation of our alarms it means that police will respond within 10 minutes, along with a keyholder for the site.”
Ken Savage, chairman of Perrys Motor Group, uses a mix of traditional manned guards and centrally controlled monitored CCTV systems to guard Perrys’ 34 dealerships.
#AM_ART_SPLIT# “There is CCTV on 70% of our sites,” he says. “We’ve gotten rid of manned guards at most of them because of the cost and now only have them on sites that are difficult to monitor with CCTV.
But at the end of the day it’s down to the local management to decide what is best.”
Chris Stevenson, a regional director for Perrys who runs the site in Preston, uses only a manned guard to protect the vehicles and building. His site has an excellent record in terms of safety and has not had any incidents for years, says Savage.
As important as it is for a dealership to ensure its buildings are adequately protected, it is vehicle security that insurance companies place most emphasis on.
The more secure the vehicles, the lower the insurance premium costs and, with car security becoming increasingly more sophisticated, keeping keys safe is one of the most important things a dealer can do.
“This is a motor retailers’ single biggest asset value within the business,” says Barry Hogg, underwriting manager for motor trade and agriculture at Norwich Union.
“Key theft is becoming increasingly common as key security within a busy dealership can often leave a lot to be desired.”
Keys ‘lost’ during normal working hours can often be assumed to have been misplaced, when in fact they have been procured by a thief. “Dealerships can lose vehicles as a consequence of opportunists taking advantage of poor business practice or being targeted by professional gangs,” says Hogg.
If precautions such as key registers and secure overnight deposit locations are not taken, it can cost a dealership hundreds of thousands of pounds a year.
Mark Frazer, from Giles insurance brokers, says that a general awareness of risk management can also decrease premium costs.
“Quotes are subject to a survey and if you demonstrate an awareness of risk management this can play in your favour. You need to differentiate yourself in this competitive market,” he says.
“Underwriters are inundated with quote requests and such things do influence their decisions.”