Hit & Run – was it you

We have coached
you before that when
you are involved in a crash,
safely pull over to evaluate and secure
the scene, exchange information and
take photographs. But what if you
didn’t know you were involved in a
crash.
Driving an 80,000 lb tractor trailer
combination on today’s busy roads
is a challenging task. So much so, it
requires a licensed professional to do
so – even then accidents happen. So
what should you do if after a couple
miles you are pulled over and told you
were involved in a crash that you have
no knowledge of. Not only involved,
but now are being accused of leaving
the scene of an accident.
Believe it or not it’s not so uncommon
of an occurrence where a truck clips
something like a tree, fence or even a
vehicle without knowing – especially
when turning. For me, having an office
on the 3rd floor near a freeway where
big trucks frequent is an awakening
experience. You regularly feel the
rumble of the truck’s mass and weight
coming down the street followed by
the jarring sounds of the trailers lifting
and falling back onto their couplers.
Being inside the cab with that going
on can certainly mask an event as
mentioned above.
Being accused of leaving the scene
of an accident is very serious. Being
convicted of that is far worse. Hit
and Run involving property damage
or injury/death can be charged as a
misdemeanor or felony depending on
the seriousness of the circumstances
involved. A conviction of a hit
and run is an automatic one year
disqualification of your commercial
operating license for the first offence
and disqualification for life for a
second offence.
If you receive a ticket for leaving the
scene, you’re going to need counsel
and you will likely appear before a
judge. The ticket is the driver license
side of things, but there is also a
criminal side that deals with intent.
The general standard for intent is, did
you or did you not know that you hit
something and left the scene and/or
should you have known that you hit
something being a professional driver
with your experience, your particular
vehicle and load.
Evidence helps. Just because you
are accused of being involved in a
crash, doesn’t mean you were. Inspect
your truck for any markings/damage
consistent with what is being alleged
and always take pictures. In one
case, our insured was able to provide
his load ticket and GPS tracking for
the day in question which proved he
wasn’t in the area at the time of the
crash. So taking note of the time can
be very important.
The bottom line is that any time you
notice something abnormal, you
should make an effort to check it out.
It may be nothing or there could be
an issue with your vehicle that could
create a bad situation or worse. The
point is not to dismiss a potential
warning sign. Like the Boy Scout
motto reads “Be Prepared” and their
slogan that reads “Do a good turn
daily”. For you drivers, those daily
turns are very important.

AB5 – SCOTUS says no review

June 30 – The U.S. Supreme Court has declined to
hear the California Trucking Association’s (CTA)
appeal of California’s Independent Contract rule
(AB5) a California state law aimed at reclassifying
owner-operators as motor carrier employees. This
means that California’s AB5 law, which would
eliminate the traditional subhaul model is expected
to take effect by July 7. Work stoppages at ports
across the state have been planned by truckers in
protest of the bill.
It is unclear how/if AB5 will impact out-of-state
truckers doing business in California. However,
the CTA believes it will have a meaningful impact
as noted in its brief to the Supreme Court: AB5
applies to all drivers while operating in California
including those from out-of-state. Accordingly,
AB5 would require all carriers and their drivers to
comply with California’s laws for employees. AB5
therefore would obligate carriers to either — use
an employee driver for the entire trip (even if the
driver could lawfully operate as an owner-operator
in other states) or — incur the expense and delay
of transferring the freight to a truck driven by an
employee when the freight enters California or to
a truck owned by an owner-operator when the
freight leaves California. The government makes
no attempt to explain how this problem could be
addressed.
The CTA is seeking a new injunction and is
currently assessing its position in obtaining a
determination that AB5 is preempted under the
Federal Aviation Administration Authorization Act.
The association believes that it will take some
months to come up with an effective strategy.
A trial attorney for the CTA (Bob Roginson) recalled
how Uber and Lyft were initially made example
of when AB5 first came out. Roginson expects
a similar move from the state with prominent
trucking companies now that the injunction is
lifted.
Because of the litigious environment in California,
all motor carriers need to mitigate risk by
immediately evaluating their operating models in
the state. We are monitoring the situation and will
update as things progress.

California AB5 Update

The California Trucking Association’s case against California’s Independent Contract rule (AB5) has taken a big hit.

In April, the U.S. Court of Appeals for the Ninth Circuit ruled 2-1 to remove the current preliminary injunction against AB5. Following that ruling, the Association filed a petition to the U.S. Supreme Court. The Supreme Court, instead of making a decision to hear the case, asked the U.S. Solicitor General to weigh in. After months of silence, the Solicitor General has returned with the conclusion that AB5 would not have a significant impact on prices, routes or services and that further review is unwarranted.

This is not just a California issue. As noted in CTA’s brief to the Supreme Court: AB-5 applies to all drivers while operating in California including those from out-of-state. Accordingly, AB-5 would require all carriers and their drivers to comply with California’s laws for employees. AB-5 therefore would obligate carriers to either — use an employee driver for the entire trip (even if the driver could lawfully operate as an owner-operator in other states) or — incur the expense and delay of transferring the freight to a truck driven by an employee when the freight enters California or to a truck owned by an owner-operator when the freight leaves California. The government makes no attempt to explain how this problem could be addressed.

It is unclear whether or not the Supreme Court will still hear the case or take the advice of the Solicitor General and let the Ninth Circuit’s ruling stand. If the Supreme Court denies review, AB5 will be implemented in the state’s trucking sector immediately. Should the Supreme Court choose to review the case, there is no timeline for completion.

Summer adjournment is at the end of June, but there is no guarantee that the court will make a decision by that time. In that case, a decision would carryover into the next court session which begins in October.

FMCSA Proposes Rule for Speed Limiters

Comment period extended to July 18

The FMCSA is intent on implementing a speed limiter rulemaking. The proposed rule targets motor carriers operating commercial motor vehicles (CMVs) in interstate commerce with a gross vehicle weight rating (GVWR) or gross vehicle weight (GVW) of 26,001 pounds or more, whichever is greater, that are equipped with an electronic engine control unit (ECU) capable of governing the maximum speed. The rule states that those CMVs be required to limit their speed (to be determined by the rulemaking) and to maintain that ECU setting for the service life of the vehicle. With this notice of intent, FMCSA requests public comments and data regarding the adjustment or reprogramming of ECUs. The comment period has been extended through July 18. Let your voice be heard. Visit the proposed rule here or visit the Federal Register at: https://www.federalregister.gov/documents/2022/05/04/2022-09443/parts-and-accessories-necessary-for-safe-operations-speed-limiting-devices.

New CCIA Gear!

Trucking t-shirt

Have you received your new CCIA t-shirt yet?

The CCIA team came up with a new design this year that highlights the theme of the nation’s supply chain. The title of the shirt is “Strongest Link In The Supply Chain”. The tri-tone design shows a class 8 tractor emerging from the center of a black shirt surrounded by chains. The tractor is adorned with wings symbolizing the free movement of goods that are carried throughout the nation.  We hope you enjoy it!

Every year, the CCIA team produces a different shirt design and distributes them to its clients. These are typically sent in XL, contact your agent for a different size. We’d love to know what you think about the shirts and are open to ideas for next year’s design.

Vehicle Prices Creating Big Insurance Gap

Truck Insurance Gap

If you’re looking to buy a new truck right now, you’re likely aware that there’s a supply and demand problem. The supply problem is with parts and how long the problem will last is unknown. So, if you really need that new truck right now, you may be in a tough spot and forced to pay more for it – a lot more. While a used truck will cost you less, relatively speaking, current used truck prices are shockingly high as well.
Because of the ongoing delays with new vehicles, used vehicles have been in high demand leaving fewer of them available. And the ones that are available are being sold at premium prices.
That brings me to our first concern. With regards to your Physical Damage insurance coverage, it’s likely that you are covered for an amount that was determined by “you” before the recent supply issue. This would likely have been a conversation with your agent asking you “how much could you purchase your truck for right now?”. If your vehicle is totaled in a loss, you will be indemnified based on the lesser of the amount you previously valued it at, or the actual cash value using comparables on the market. Because of the current spike in prices, you could be left paying a sizable amount out-of-pocket to find a replacement vehicle. Example: XYZ Trucking had a complete loss to their tractor that they valued at $20,000. Due to the recent supply and demand issue, the market value of that used tractor is now $30,000. XYZ Trucking will be indemnified up to the $20,000 valuation. Now, XYZ Trucking will have to pay an additional $10,000 out-of-pocket to purchase another tractor of like kind.
Our second concern is the problem with the parts supply. Due to the lack of availability with certain parts, repairs to your vehicle could take an indefinite amount of time. Because of this, your vehicle could potentially be deemed a total loss. This would once again put you in the above-mentioned situation of needing a significant amount of money out-of-pocket to find an acceptable replacement vehicle.
It may be time to revisit that valuation and upgrade your protection. Simply call your agent to discuss this important topic.

Appeals Court strikes down Trailer Standards

Trailer Standards

November 12 – According to a ruling by the District of Columbia Circuit Court of Appeals, trailers will not have to adhere to stricter emissions and fuel standards.
The EPA and NHTSA set new standards that went into effect in December 2017, but a lawsuit filed by the Truck and Trailer Manufacturers Association paused those standards during litigation.
Trailers would have likely been required to utilize costly aerodynamic technologies such as side skirts, automatic tire pressure systems, wheel covers and tail skirts in order to comply.
In its ruling, the Court of Appeals panel deemed that trailers are not self-propelled, and since the EPA regulates “motor vehicles”, the standards set by the Agency are outside of their authority. The EPA argued that the tractor-trailer as a whole should be considered the pertinent vehicle, but the court was not convinced. With regard to the NHTSA, the court found that the Administration can regulate “an on-highway vehicle with a gross vehicle weight rating of 10,000 pounds or more.” Since the term “vehicle” was not defined, the court based on the context, found that in this case the Administration’s reach is limited to machines that use fuel which negates the rule.
The three-judge panel was not unanimous in their decision as Circuit Judge Patricia Millett filed a dissent to the findings of NHTSA’s rule. Judge Millett, citing the Motor Vehicle Information and Cost Savings Act, argued that “vehicles” should be interpreted to• include trailers as it defines “motor vehicle” to include “vehicles” that are “driven or drawn by mechanical power”. The court ultimately vacated all portions of a 2016 final rule on greenhouse gas emission standards that apply to trailers.
Industry professionals have dodged a costly bullet that they claim was a one-size fits all solution and not appropriate for all trucking sectors. For example, fully-loaded trailers used for over-the-road applications will gain efficiencies whereas those operating in local deliveries are burdened with extra weight and will lose efficiency. Furthermore, these areas of efficiency are being achieved organically without the need of overreaching and costly regulatory interference.

Business Cost Increase:

Minimum liability insurance increase to significantly burden truckers’

Liability Insurance Increase

According to the American Transportation Research Institute (ATRI) fleet insurance costs rose 12% between 2017 and 2018, the second fastest year-over-year growth rate. The Institute also found that, “Given the substantial insurance cost increases over the last several years, it appears that the industry has reached a ceiling in its ability to continuously cover annual double-digit increases in insurance premiums”.
AND… here we go again, yet another regulatory overreach and a potential significant insurance increase under the guise of safety. This one we’ve seen more than once before – but the numbers still don’t seem to support the need.

A provision to increase the minimum level of liability insurance for truckers has reappeared once again in the “INVEST in America Act” (H.R. 3864) – the House’s version of a surface transportation bill. The provision is gently titled “Updating the required amount of insurance for motor vehicles”. The “Update” would require the minimum amount of insurance for motor carriers to be raised from $750,000 to $2,000,000 (167%) and to be adjusted for inflation every 5 years.

Supporters of the legislation claim that the increase is modest and necessary as it has not been increased since implemented in the 1980s.

The numbers:
In 2018, FMCSA data shows that there were approximately 560,000 crashes with large trucks and buses. Of those, 77.5% were property damage only, 21.6% were injury-related and 0.8% were fatal occurrences. Of those crashes, it is estimated that 0.6% may have not provided enough insurance to adequately compensate the other party(ies).It is unclear where the safety benefit comes into play with this “Update”, but supporters of the legislation point the finger at insurers for not better qualifying carriers. They allege that at higher liability levels, insurers would have more at stake and could be incentivized to make greater efforts to screen out unqualified carriers and adjust insurance rates accordingly. The assumption being that in doing so, they would price the bad carriers off of the roads.

Those in favor of the legislation also point to a 2013 report by the DOT which concluded that “at current levels, liability insurance does not appear to be functioning effectively as catastrophe coverage”. Notwithstanding those arguments, opponents of the legislation claim that doubling and tripling of the minimum insurance requirement is arbitrary and dangerous and would dramatically drive up insurance premiums that would likely cripple many carriers, increase delivery rates which increase the cost of goods to consumers with little to no safety benefit. Additionally, they allege this effort is less about safety and more about the support trial lawyers have in Congress.

In a June 9 full committee markup of the legislation, there was an amendment to strike the insurance provision introduced by Rep. Mike Bost, R-Ill. The amendment failed a voice vote and a recorded vote was requested which also failed 38-30. If you’re not familiar, after an amendment to strike a provision is presented, there is a voice vote that is judged by level of sound (who was the loudest). In this meeting all votes fell mostly along party lines, i.e. regardless of sound the Democrat chair struck down the amendment.

The 19-hour hearing ended with the committee approving the five-year, $547 billion INVEST in America Act. The bill was sent to the House floor for further consideration. Be sure to contact your Representative and give your feedback on this very important issue.

DASHCAM VIDEO Renders Eyewitness Incompetent

Video evidence emerging as trump card in lawsuits

Consider this, you’re driving down the road and you hear a loud noise. A motorist just crashed into the back of your truck and was killed. Eyewitness testimony states that you swerved out of your lane and into the motorist’s lane putting you squarely at-fault for the crash. If it goes to trial, it’s highly likely that a jury will find you responsible for the crash and award policy limits to the claimant. If you’re a driver of a larger company, the award could be in the hundreds of millions.

This is a real and active scenario playing out in the state of Florida (Wilsonart, LLC vs the estate of Jon Lopez). However in this case the truck driver had a dashcam that was recording at the time of the crash which contradicts the eyewitness testimony.

In-vehicle dashcams are becoming more commonplace with private motorists and commercial truckers should be weighing the decision to do the same. We’ve all seen first-hand the ability of video evidence (VE) to change/shape opinions such as with the high-profile death of George Floyd and they can help in accident scenes (like the one above) as well.

Evidence in a courtroom is what wins cases and VE is the Ace in the deck. VE can show and often prove fault or innocence instead of simply your word against theirs or in this case false testimony. VE cuts down on fraudulent claims that increase premiums, hurt your loss ratio and your ability to work. VE can also give your insurance company added reason to fight your case in court rather than simply settling the claim without a trial.

In the case above, the judge initially handed down summary judgement (without a trial) in favor of the trucker because of the VE. The dashcam video was presented showing that the driver maintained a straight line of travel and did not swerve into another lane rendering the eyewitness testimony as incompetent evidence. The judge later reversed his decision based on an appeal by the Lopez estate claiming a jury should decide the legitimacy of their witness and expert testimony. However, in the absence of the VE, the trucker would have likely been found 100% at-fault.

This and many other scenarios can be challenged with VE and we feel you should have that tool in your toolbox. For less than $200 you can have a camera installed in your vehicle. Be sure that any camera you purchase has the ability to time/date stamp the video and offers a continuous recording feature. If you do install camera(s), be sure to take action on critical events. If you don’t utilize that data properly, lawyers can use that against you in court.
STAY SAFE!

Comprehensive Safety Program

The existence of your operation doesn’t just depend on profitability

So, your insurance company is pressing you about the details and contacts of your safety program. Do you roll your eyes and think, “Safety Program!!!”, “How can I make this go away so I can just drive and earn a living”, or do you have a meaningful plan in place? A comprehensive safety program is a must for mitigating losses and goes a long way towards portraying you as a responsible carrier that over time reduces the operational risk and protects employees.

From the ever-increasing cost of equipment to sophisticated insurance fraud rings and nuclear jury awards, insurance companies are finding it harder than ever to reduce the financial volatility of a claim. Because of this, it is imperative that you as a motor carrier have controls in place for closely managing the safety of your operation.

Insurance companies are in the business of transferring risk from you to them. How much risk they take is the variable, but it is not a guessing game. Every insurance company has a set of standards that create their preferred risk. Any deviation from that criteria makes you a less common risk and often a less desirable risk which could mean higher premiums, declination or cancellation/non-renewal of your policy(ies). Each at-fault claim that a motor carrier incurs raises the percentage of money paid in premiums compared to money the insurance company pays to settle those claims. Once the insurance company pays out an amount on the carrier’s behalf that exceeds their level of tolerance for that risk, they become less desirable and will surely incur repercussions.

An alarming trend over the past number of years has been the way law firms have used the advertising of large awards to solicit new clients. Especially how those firms portray the trucking industry as reckless and irresponsible. The insurance industry is all too familiar with the trend and is continuously looking for ways to slow the onslaught. The result of those awards materialise as raised premiums, cancelled/non-renewed policies, risk reduction and tighter risk selection by ensuring the client is as risk-free as possible and has a safety program in place.

A recent study by the Transportation Research Institute (ATRI) attempts to make sense of out-of-control jury awards against the trucking industry. Interviewees from the ATRI study generally concurred that the more safety activities motor carriers engaged in to prevent crashes the lower the likelihood that a nuclear verdict would result. It was also commonly noted that motor carriers typically do not allocate enough resources toward safety and crash prevention.

There are many factors that play a role in determining fault and awarding large payouts – many of which are out of the control of trucking companies. Nevertheless, motor carriers need to focus on those areas that they can control such as: meeting/exceeding FMCSRs, equipment maintenance, inspections, citations/violations, cargo securement, driver training, and properly maintaining log books.

Plaintiff attorneys will frame FMCSRs as minimum standards and juries are less forgiving when plaintiffs can document that additional reasonable steps to prevent a crash could have been taken, regardless of compliance with FMCSRs. The ability of defense attorneys to have documented safety activities that exceed FMCSRs carries great weight with juries. This also makes you a better risk in the eyes of an insurance company. According to the ATRI, a key strategy among plaintiff attorneys is to emotionally charge a jury against a motor carrier by painting them as careless and unsafe. However, a motor carrier that has not only met FMCSRs but exceeded them, reduces the ability of the plaintiff attorney to stigmatize them. This is where a safety program can validate responsible safety efforts.

A reasonable and responsible safety program should have appropriate, documented disciplinary actions. Per the ATRI study, in situations where there was any history of alcohol or drug use by the truck driver, it became much easier to convince a jury that the truck driver was at fault for the crash – even when the crash causal factors were unclear or tenuous. So, a responsible action might be to have documentation
that meets or exceeds what is expected before hiring or returning a driver to active duty following a positive test – regardless of time between the test and return to duty.

To begin drafting a safety program, begin by answering some questions you might be asked following a crash such as:

What steps have you taken to ensure your drivers are roadworthy?

What operational, safety or training factors could have prevented the crash from happening?

What actions have you taken following previous crashes?

Do you have training sessions/driver meetings?

Do you have a vehicle maintenance schedule?

Are your pre- and post-trip inspection reports handled properly?

Do you audit logbooks?

Are your inspections clean or are there patterns in violations?

Plaintiff attorneys are not paid by the hour but by the size of the award. Following a crash, you should expect that every aspect of your operation from maintenance to meal breaks will be scrutinized for the sole purpose of applying fault. Be proactive and have a comprehensive safety program in place. If you need help, contact your insurance agent or a loss prevention specialist.