Environmental Impact Assessment
An essential feature of our scheme design is that it should provide a positive incentive for drivers to choose smaller, more economically and environmentally friendly cars. By downsizing the fleet financial savings can be achieved in a number of areas including Insurance, Car Benefit Tax, Class 1a National Insurance and early termination costs. In addition, it improves cash flow and reduces driver's rental contributions.
One area that is subject to contention concerns car insurance. Under a fleet insurance arrangement the premium is averaged, which means that a Ford Fiesta costs the same as a BMW. Although, at present, there is no direct correlation between CO2 emissions and car insurance it generally follows that cars that are cheaper to insurer often have a low CO2 value.
To encourage staff to select environmentally friendly cars the allowance can be increased for low emission cars and reduced for high emission cars. The CO2 emission value of each car would be linked to the cost of vehicle insurance. For example the insurance cost would reduce by 15% for a car with a CO2 value up to 165 g/km and increase by 25% for a car over 195 g/km. It is intended that the 'green' incentive is cost neutral and that clients will achieve Controls Assurance targets.