In 1928, Motorists Mutual Insurance Co. sprang to life with an initial investment of $15,000 and a philosophy that remains the foundation of the company to this day: "Do what is best for policyholders, agents, sales representatives, and associates."

Motorists Mutual is the lead company of The Motorists Insurance Group. The group of companies includes five property and casualty insurance companies, one life insurance company, and two brokerages.

Motorists has assets of more than $1.5 billion and markets competitive personal, commercial, and life insurance products through a network of thousands of agents and sales representatives.

Through the years, Motorists has developed pioneering policyholder coverages that have become industry standards, fostered a strong working relationship with independent agents, and created an environment for performance and innovation.

Motorists' founding formula of employing "smart people" and looking for creative solutions still works to this day. The Group continues to look to the future with a singular vision and purpose: To be the best choice possible for policyholders, agents, and associates.

 

Motorists Stays Conservative

According to Michael Lisi, assistant vice president, Office Services, the organization can more easily remain fiscally conservative because it is a group of mutual companies.

"Because we are owned by our policyholders, we can plan over longer periods and ensure what we do is in the best long-term interests of policyholders, agents, and associates," Lisi said.

Lisi partners with Lisa Price, Office Services supervisor, and Karen Macioce, Office Services technical clerk, to handle facilities, commercial real estate functions, corporate relocations, fire and safety, shipping, purchasing, special printing needs, and fleet for the Group's Columbus, Ohio, headquarters. They also support and consult with Motorists' affiliated companies in all these areas.

The companies' fleet (225 vehicles) is composed mainly of the Chevrolet Impala.

"We try to fit a broad base of needs with one vehicle model to keep costs down," Lisi said. "And keeping to just a couple of sources when buying vehicles helps us get a low net cost while still getting a decent incentive from the manufacturer."

 

Attention to Detail Translates Into Big Service Impact

A main goal of Motorists' fleet team is to provide a high level of service to fleet customers by anticipating needs and staying on top of industry best practices to deliver the right products and services.

"When competing for associates, we must ensure our fleet services are equal to and, in many ways, better than what they might be used to," Lisi said. "We try to make things work financially and then make sure the vehicle and processes are seamless. We do it right and try to save money wherever we can. This also allows us to attract and retain talent moving forward."

The fleet team also must remain engaged internally with other divisions to deliver service and measure the effect of that service. Lisi and his team value their communication with other departments because it allows them to deliver the highest level of service to drivers.

"All vendors we work with must provide the best possible service at the lowest possible cost," Lisi said. "We do periodic reviews and requests for proposals to ensure we are getting the best possible pricing. We also don't necessarily take the lowest bidder. Relationships are valued. Our vendors know this, and it helps them to provide us the high level of service we want."

Lisi and his team also "worry about the details because they translate into big results," including running an internal fleet Web site and selling fleet cars to associates or agents before going to auctions.

An online bidding system has been set up to automate the process. Selling to associates and agents eliminates auction fees Motorists would have to pay otherwise. The fleet team does use auctions when necessary, choosing those venues that consistently pro-vide a high rate of return to maximize dollars.

"The employee sales program has been beneficial for both the company and employees," according to Price. "Employees benefit by being able to purchase a good used car at a reasonable price."

Employees have access to all maintenance records and can feel confident the vehicle has been maintained properly, Price added.

"And the Group benefits because we can sell the vehicles without paying any auction or transportation fees," she said.

Another internal protocol includes the fleet team handling all auto titles, thus eliminating fees from an outside source.

"We implement best practices of larger fleets through benchmarking and then assimilate policies and procedures to our operations seamlessly without adding people," Lisi said.

Benchmarking allows Motorists' fleet to remain productive and cost-effective compared to the industry. Lisi pointed out that being a part of the larger fleet community really helps the team excel.

"We are members of NAFA and AFLA, we subscribe to fleet publications like Fleet Financials - our senior officer has his own copy - and we work closely with our fleet administration company, Donlen Corp., to stay on top of industry best practices and issues that affect our fleet operation," Lisi said.

The main priority for Lisi, Price, and Macioce is to know what is working best, what is not working well, and how to quickly adjust to provide the highest level of service while remaining cost-effective. Motorists accomplishes these important priorities with a small staff that deals with other day-to-day duties besides fleet.

"Communication is not only important, it is essential to build a successful working relationship and a fleet program that works with our fleet customers," Macioce said. "Our objective as a team in Office Services is to provide excellent and consistent service with all of our fleet customers."

Superior communication and service is fostered through an internal service program, called MAX Service, which allows the Motorists fleet team to consider all operational factors. Macioce added that this total view enhances decision-making processes, whether selecting a vehicle to suit the fleet driver needs or providing the best service and safety practices at any given time.

"This is why it is imperative to recognize, anticipate, and understand all our drivers' needs," she said. "It is essential to have a program that works, one that keeps our fleet drivers happy and is an attractive perk to new prospective associates and/or fleet customers."

This constant communication remains key for the team, which communicates to drivers during on-site meetings, by e-mail, and through a monthly newsletter that highlights safety and proper car operation.

"We have raised communications by publishing a fleet newsletter to all drivers," Lisi said. "We also communicate how driving habits can greatly affect costs."

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Motorists Owns Vehicles, but Uses Management Services

Motorists' fleet team is an advocate for using fleet management services without a leasing solution. The Group awarded a fleet management contract to Donlen in first quarter 2008.

"Donlen provides a consistent level of service without going to the expense of hiring an entire fleet department," Lisi said. "We don't get caught up in the lease game because we are fiscally sound. We buy the vehicles outright and turn them over."

Motorists does not feel the cost of leasing is financially beneficial. This conclusion resulted from an analysis in which Motorists compared the interest that could be made on a short-term investment instrument versus the cost of financing vehicles.

"We maximize this decision by getting very good terms from our suppliers," Lisi said. "We work with our suppliers on getting the best price on tires, oil, fuel, etc."

Donlen provides Motorists a fuel credit card and a discount.

To ensure this management solution continues to fit the companies' goals, the fleet team reviews acquisition and disposal costs each quarter. The costs are collected and measured by Motorists' Accounting Division and measured against market conditions, prior-year costs, and published data.

Lisi, Price, and Macioce also supply senior management a fleet plan that includes current and historical data to ensure budgeted costs are well communicated throughout the organization.

"We work with our fleet management company to highlight which drivers may not be getting maintenance done, identifying which national vendors are providing similar services at lower costs, and making sense on timely scheduled maintenance," Lisi said.

The team also re-evaluates the fleet annually, reviewing gas mileage and cost of ownership on a range of vehicles. They also plan processes and determine how many vehicles are required and who needs a vehicle.

"We do this to stay ahead of changes in the market," Lisi said.

 

Partnering with Senior Management Aids Vision-Setting

Consistent communication, strength in costs projections, and staying on top of markets helps keep fleet costs and senior management working without surprises.

"Once provided with the vision and goals, senior management needs to rely on cost projections for operational, division-driven, and project expenses," Lisi said. "Surprises need to be eliminated to ensure the integrity of the numbers."

This formula has worked well at Motorists.

The fleet team's interaction with senior management on policy and budgetary issues remains critical to daily operations.

The team provides information to senior management on a consistent basis. To keep this communication clear, Lisi reports directly to the senior vice president of Corporate Services.

"A reporting level like that keeps our senior officers abreast of market conditions, divisional requests, and project costs that may have an effect on fleet costs," he said. "The more they are aware, the less there is a chance of a budget surprise."

Motorists also fosters open communication among the companies at all levels of management.

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Motorists Fleet Team Elevates Driver Productivity

One of the biggest roadblocks for a fleet driver is downtime. To minimize potential downtime, the fleet team is always fully available to drivers, who are provided cell phones and emergency numbers.

Because Motorists drivers are busy, especially after weather catastrophes, minimizing driver downtime is crucial.

The fleet team even developed a concierge-type service, which includes tire care. Drivers are asked to call in when their vehicles need new tires. Motorists then uses Donlen's technology to locate a national provider near the driver's location, confirm the tire model is at the shop, and schedule a driver appointment for the replacement.

"This eliminates time wasted waiting and the need for Donlen's staff to call us because we place authorizations for the purchase that can be viewed by Donlen's representatives," Lisi said.

Motorists has also been provided a system with Donlen Fleet Management Services that communicates the Group's need to control expenses, but puts the fleet team in charge of those costs.

"We have necessary procedures in place for the delivery of this service," Lisi said. "Donlen's technologies allow us to see where we are, who needs what, and we can communicate by phone, cell, or computer to eliminate downtime."

 

Fleet Reduces Fuel Costs by Reassessing Vehicles

To mitigate fuel costs, Motorists' fleet recently switched from four-cylinder to six-cylinder engines. The six-cylinder engine performs more efficiently in certain terrain in the Group's operating states.

The change to the six-cylinder, flex-fuel-capable Chevrolet Impala allowed the fleet to increase gas mileage and gain better vehicle performance in certain areas. "We considered hybrids, but they just don't make sense at this point," Lisi said.

The use of fuel cards is also a key practice within Motorists' fleet. The fuel cards are accepted anywhere MasterCard is accepted, allowing drivers to purchase fuel just about anywhere in the country.

"This helps save our drivers' time because they are not getting off the highway searching for a fuel facility that accepts their fuel card," Price noted.

The card requires drivers to input their odometer reading at the time of fill-up, allowing fleet management to closely monitor mpg.

"We also receive a fuel discount based on the amount of fuel we purchase during the month," Price added.

 

Supporting and Maintaining a High-Quality Fleet

The bottom line is Motorists Insurance Group delivers exceptional service every day.

"Our management team recognizes that our ability to deliver this high level of service differentiates us in the marketplace," Lisi said. "So, we recognize and provide financial incentives to award individual efforts as communicated by our agents, policyholders, and employees."

Moving toward the future, Lisi, Price, and Macioce will remain proactive and focused on keeping service high while ensuring cost efficiencies. ♦

 

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