161025 Lumpsum & Recoveries FoIA 743153

25/10/2016 – Draft FOI 743153 Final Response 25.10.16 same number and commercial sensitivity

Incident response is paid for by Highways England as part of a fixed ‘Lump Sum’ payment to the service provider, on a monthly basis.

However, under the ASC this payment is calculated based upon the predicted split of identified culprit claims so it is designed to cover the proportion of claims that are not traced to a specific driver.

All contractors reconcile their costs annually against their recoveries.

If the proportion of traced incidents exceeds expectations an assessment would be made and the Lump Sum payment would be reduced. However, no contractor has ever been in the position where the proportion of traced claims exceeds these assessments and there are various factors for this. The main one being not all damage linked to a driver is reported by the driver.

Where the over threshold claims are concerned, Kier would pass the charges through to Highways England and assist in their recovery in the same way as they would with the below threshold claims that they pursue directly. The only differing factor between the claims is the format as the insurance community have worked with Kier to display their breakdown of charges in a manner that they prefer. With an over threshold claim, Kier would allocate charges in accordance to its minimum shift allowance i.e. if an incident occurs out of hours they would charge for the full period of coverage as opposed to charging a multiplier. Ultimately, this results in the same number; it is just a different way to display it.

The service provider will incur costs differently dependent upon time, location, level of response required etc. and have the right to recover these specifically against the relevant negligent party, if they can be identified.