Logistics companies and manufacturers seem to suggest
that the infrastructure and growth in Russia makes it
impossible to keep the damage ratio lower than the 3% that
they usually suffer en route to the dealers during loading,
unloading and storage. The apparently-popular policy in
Russia - that your insurance company simply increases
premiums and forgets about it, rather than attempting a
recovery - sounds stressful. Despite recent improvements to
bring the market more into line with Europe, Russia still
appears a daunting place to make, transport and sell
The market in Russia is clearly growing and if the system
does not improve the increased volumes could lead to capacity
issues, not just within the local ports but with the carriers
across Russia. Now is clearly the time to look closely at the
processes involved in insuring /nished vehicles, improving
damage ratios, reducing costs and increasing the satisfaction
of everyone involved in the outbound supply chain.
Two years ago, the Ipswich-based Sevatas, a leader in the
provision of risk management, claims and damage reduction
solutions to the /nished vehicle logistics sector in Europe, set
up their /rst of/ce in Moscow. Following an extensive
consultancy project, they were asked to move in permanently
and subsequently hired a management agent and freelance
consultant to handle the paperwork and /nd the right people
with the right range of skills in such a niche market. Dominic
Nichols, Lead Account Executive, explains how they found
themselves in Russia and how they got organised.
When we set up the of/ce at the outset, our whole
perception was that it was a market where you don’t know until
you try.
Lack of clarity on damage data and inconsistent insurance
arrangements were the starting points. Then, once we looked
further there were issues with claims procedures, issues with
carrier contracting and a whole raft of problems that needed
resolving and which needed to be overcome in order to help
Russia become more transparent to our European clients.”
The claims process that Sevatas was reviewing, as part of a
project, insisted that the dealers send their claims to the
carriers, the logistics service providers would then review and if
they felt that they wanted to accept the claim they did so, and
if they didn’t then the claim went on to a third party agent. The
manufacturer wasn’t playing too much of a role in that process,
which left the claims agent arguing with the carriers and the
dealer. Dealers spent too long trying to get their claim paid, as
the carrier rejected it and it got passed on. This fragmented the
data available, as claims were being made with different
people, and an accurate representation of the damage ratio
was dif/cult to determine.
Whatwe learnt in
Negative expectations about insuring vehicles making
the outbound journey to dealers over the 6,592,800
square miles of Russia are not always founded. While
there are challenges, they can be managed with good
preparation and cooperation says
Laura King
Dominic Nichols, Lead Account Executive, Sevatas