Author: cciaweb1blog1

Renewable Diesel

Renewable Diesel

Renewable Diesel

found to reduce 2x more CO2 than BEVs

 

Is there still a viable option for internal combustion diesel engines? The answer is a resounding yes according to a recent report by the American Transportation Research Institute (ATRI).

In May 2022, the ATRI compared the life-cycle carbon dioxide (CO2) emissions of petroleum diesel fueled trucks to alternative fueled trucks. Their findings included a potential 30% decrease in life-cycle CO2 per truck through the use of battery electric vehicle (BEV) trucks and a 67.3% decrease through the use of renewable diesel (RD) in existing Class 8 trucks.

RD is a fuel that is produced to be “chemically identical” to petroleum diesel; thus, RD can be mixed with petroleum diesel in any amount or used as a standalone, drop-in fuel in a traditional diesel truck without consequences.

A second ATRI study, published in December 2022, looked at the technical and electric infrastructure-related challenges of shifting to BEV trucks. That report identified substantial barriers to implementation including:

• Insufficient electricity generation, transmission and distribution in the U.S.;
• The need for a widely accessible truck charging network; and
• Complications related to the mining and processing of battery materials

Now, the ATRI has taken a more robust look at the factors and benefits of using RD as an alternative to BEV in its research titled Renewable Diesel – A Catalyst for Decarbonization.

Renewable Diesel is a biofuel (not fossil) and represents an alternative and/or supplement to petroleum diesel. Biofuels are made from plant- and animal-based products and waste streams that are converted into a usable fuel. Biofuels are considered renewable since they are derived from organic material that can be grown – such as soybean, corn oil and even algae which would help to satisfy those that fear competition with food sourcing.

In the U.S., California leads the push for zero-emission vehicles. In its current long-term regulatory focus for heavy-duty trucks, zero “tailpipe” emissions not necessarily lifecycle emissions is highlighted. This essentially limits the trucking industry to a few options. All the while, an increasing number of zero-emission vehicles (ZEV) are required to be brought to the new truck market until a no new internal combustion mandate in 2036 for class 4-8 trucks.

So what can be done? Well, let’s take a look at the European Union’s (EU) example, the EU provides member states a choice of decarbonization options. The Council of the EU has stated that “while the strengthened CO2 reduction targets will accelerate the uptake of ZEVs, a significant part of the stock of heavy-duty vehicles on the roads will remain internal combustion engine vehicles”. Recognizing ZEV challenges, the EU chose to raise the overall renewable energy consumption to 42.5% by 2030 across all sectors instead of a mandate for ZEVs.

The bottom line is that while we have a serious emissions problem we also need to keep freight moving. RD use decreases CO2 emissions significantly when compared to petroleum diesel. However, an across the board ZEV trucks mandate would result in higher overall CO2 emissions compared to policies and programs to increase the production and use of RD.

Considering that BEVs produce substantially more CO2 emissions over their life-cycle than do internal combustion RD, why isn’t there a bigger effort towards renewable fuels to supplement ZEVs? Shouldn’t all CO2 emissions be considered – not just at the tailpipe?

Dash Cam Defense

Over the past decade, litigation targeting the trucking industry has skyrocketed. Motorists involved in crashes with big rig trucks are being conditioned by law firms through continuous advertising to sue those carriers for big payouts. Sadly, this is happening regardless of fault, damages or injury.

Dash Cam Defense

 

When involved in a crash one of the ways trucking operations are helping to shield themselves from unwarranted liability is by installing dash cameras in their vehicles. This is a trend that is gaining a lot of popularity as litigation becomes a more routine part of the claims handling process. Some insurance companies are even surveying their insureds for a partnership to have those cameras installed.

 

The American Transportation Research Institute (ATRI) reports that large verdicts against trucking fleets continue to increase dramatically, both in number and in size of awards. Research conducted over 13 years of data reveals that in the first five years of that data (600 cases between 2006 and 2019), there were 26 cases settled for over

$1 million, and in the last five years, there were nearly 300 cases. Considering that just one bad crash can jeopardize a company’s future, carriers must take extra steps to (at the minimum) defend their driver’s actions behind the wheel. This must include vehicle maintenance and driver selection.

Example scenario: Over the past summer, one of our clients was traveling through an intersection and collided with a motorist and their family turning left in front of him. The initial charge was made against the truck driver placing blame solely on him for speeding through the intersection.

In this particular case, our client’s vehicle was not equipped with a dash camera. However, the determined minds of the claims staff including the driver decided to approach surrounding businesses for any video cameras they may have had rolling at the time of the crash. Fortunately for our client, one business owner’s camera captured the entire incident and thankfully they were willing to share that video. The video evidence along with data from the truck’s engine control module validated the driver’s innocence and showed the driver of the other vehicle making a poor choice that led to the crash.
Without this evidence, attorneys likely would have scoured his record looking for any missed maintenance, prior crashes, citations, criminal history, etc in an effort to paint an irresponsible and reckless monster behind the wheel. They would then point their attention at the company that hired this “irresponsible” driver and add them to the lawsuit.

As you might imagine, this is not a situation anyone would want to be in. Still, it happens frequently and truckers need to be prepared. We highly recommend installing dash cameras in your vehicle(s). Additionally, companies need to adhere to strict maintenance schedules, make necessary repairs, and vet drivers before putting them in a position of power behind the wheel. It is advisable to conduct regular driver meetings to discuss trends, expectations, what-to-dos and incentives. Reach out to us if we can be of assistance.

What’s at stake with who you’re hiring

Our claims professionals are always looking out for the best interests of all parties along the insurance process. While the following issue has not risen to the status of a claims trend, it is alarming due to the potential for a nuclear verdict.

Knowing what’s at stake by hiring a driver to work for you is something both you and your insurance professional should have discussed. However, when a carrier goes against the advice of that professional and/or operates contrary to the stipulations in their insurance contract, they are creating additional exposure that could lead to a claim of negligence.

A claim for negligent entrustment arises when one party is held liable for negligently giving someone else a “dangerous instrumentality” with which that person causes injury to a third party. This could be interpreted as an employer entrusting a driver with a vehicle with which that driver isn’t operating responsibly. It could also be interpreted as an employer allowing a driver to operate their vehicle that the driver is not qualified to operate.

A claim for negligent hiring arises when an employer knew or should have known of an employee’s potential risk to cause harm, or if the risk would have been discovered by a reasonable investigation.

Please review the scenarios below that could be labeled as irresponsible and create unnecessary exposure.

• Do you have drivers (often part-time) delivering your loads that your insurance company does not know about? You should be notifying your insurance agent about all your drivers. Your agent knows your policy better than you and if there is an issue with that driver or the policy, they will notify you of the risk or help to deal with that exposure.
• Are your drivers allowing passengers to ride along in their vehicle during on-duty time? Many commercial insurance policies have exclusions for passengers, most notably family members. If you’re not sure, ask your agent before allowing passengers and instruct your drivers accordingly.
• Do your drivers have the proper license type to operate your vehicles and is it valid? Obtaining MVRs at least annually for your drivers is a legal requirement to stay compliant with FMCSA guidelines. However, anything can change within a year, and verifying the validity of those licenses periodically is just good business practice. Drivers don’t always self-update with changes.
• Are your driver’s medical cards current? This is something to stay on top of. Should your driver have a medical event while driving that would have excluded them from being behind the wheel, you could have a claim that will quickly escalate.

You and your insurance professionals are on the same team and need to be on the same page with your operational exposure. If you are ever in doubt about coverage, don’t just chance it, give them a call.

Latest Claims Trends

It is our intent to regularly inform you of trending claims affecting our insureds. Having examined our most recent claims data, our analysts have detected two trends that need attention.

First, our claims handlers have been receiving claims where other vehicles have been crashing into our insured’s vehicles. Secondly, rear-end crashes persist as a chronic claim.

In situations where another vehicle collides with yours, it is imperative that you document as much about the crash as possible. Due in large part to a trucker’s liability limits being significantly higher than 4-wheel motorists, the industry is under assault by fraudulent individuals/groups and attorneys dedicated towards acquiring and litigating trucker claims regardless of fault.

In documenting the scene, you should be photographing all angles of the crash including the area of impact. Be sure to photograph signs, license plates of vehicles involved, the intersection, and skid marks. Try to do this while maintaining relativity to the crash area. Additionally, seek out names and numbers of any witnesses and be sure to take time to write down your account of the incident.

With respect to rear-end crashes, these crashes are chronic and should continue as a hot topic discussion at driver meetings. Below are some tips to reducing this type of crash.

If you are in a rush, you will likely be driving too fast for conditions or too close to be able to stop in time to avoid a collision. Maintain space between you and the vehicle ahead of you. A 3-second cushion should be minimum at higher speeds. Maintaining this cushion is very important due to motorists merging unexpectedly and braking quickly.

Distractions can take your attention from the road. A loaded semi traveling at 60 mph will travel 88 feet per second and need roughly 500ft to fully stop. At that same speed a 4-wheel motorist can stop in around 200ft. Minimize your distractions and keep focused on the road.

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.

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.

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.

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!