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.

Trying to get a good night’s sleep

sleep1In the trucking industry where there is a need for long periods of acute mental awareness during long stretches of physical inactivity, quality sleep is vitally important. From time to time we hear of incidents where sleep was related to a crash and we must not glaze over the seriousness of proper rest.

Most adults need 7-8 hours of sleep per night, although some need more or less sleep to be adequately rested. And when you have not gotten the right amount for your body, “oh boy” does it let you know. Well, sorry to say that there isn’t much that can take the place of a good night’s sleep to keep you alert. So, let’s first discuss what a good night’s sleep is and along the way talk about things to keep your alert level as high as possible while you’re awake.

Located in the brain is your body’s biological clock that tells it when it’s time to sleep and when to be awake. Your clock runs on a 24 hour cycle and regulates body temperature, alertness and the daily hormone cycles which stimulate cells into action. Disruption to any of the phases of the clock can cause physical and mental-related issues.

There are two main types of sleep, rapid-eye-movement (REM), and non-rapid-eye-movement (NREM). In most adults, sleep begins with the NREM phase. NREM sleep has three main stages. NREM begins with the 1st stage of gently dozing off until reaching the 3rd stage which is the “couldn’t wake you up with a bullhorn” stage of the NREM phase. In the progression from stage 1 to stage 3, brain waves slow and become more synchronized, and the eyes remain still. In the 3rd stage, the brain becomes less responsive to external stimuli, blood pressure and body temperature drop and muscles relax. The 3rd stage is where scientists believe physical and mental recuperation occur like protein building and hormone release. The NREM phase then reverses stages to a more awake stage 2 then stage 1 at which point the REM phase begins.

During REM sleep (aka “active sleep” state), muscles in the arms and legs are temporarily paralyzed, the slow brain wave sleep of NREM quickens as does your heart beat and breathing. The blood pressure rises and the eyes move around in all directions. Scientists believe these eye movements are related to dreams. REM can last from 5 to 30 minutes. NREM sleep and REM sleep continue to alternate throughout the night with the length of NREM stage 3 declining during each cycle. The average length of the NREM-REM sleep cycles are between 70 and 120 minutes.
Many of us have awake times that do not match our internal sleep clock which wants to be awake during the day and asleep at night. For those that do, you’ll have to work extra hard to get the sleep your body needs.

There are a lot of factors that affect the quality and quantity of sleep which include stress, what we eat and drink, medical conditions and the medications we take, the environment in which we sleep and the times at which we finally get to sleep. Any one of these can disrupt the depth of sleep we need so badly.

STRESS: Stress can stimulate an arousal response making restful sleep more difficult to achieve. Search out ways to help decompress e.g., exercise, yoga, music, deep breathing techniques, etc.

ALCOHOL: Alcohol can cause a person to fall asleep more quickly, but the quality of sleep will be compromised. Ingesting alcohol before bedtime has shown to cause increased awakenings due to the arousal effect the alcohol has as it is metabolized throughout the night.

CAFFEINE: A chemical called adenosine, which naturally builds in the brain during awake times is believed to inhibit brain cells that promote alertness. Hence, the longer we’re awake, the more sleepy we become. Interestingly, caffeine works to block the adenosine receptors of the brain allowing nerve cells to maintain activity. However, the more caffeine we ingest the longer it will take for the affects to wear off which can interfere with sleep cycles.

LIGHT: Exposure to light in the evening tends to delay the phase of our internal clock and leads us to prefer later sleep times. Bright light bulbs and electronic devices are common examples and should be minimized before bedtime.

PAIN: Pain and discomfort limit the depth of sleep we get. Those with chronic and acute pain should limit caffeine and alcohol consumption and practice stress reliving techniques. Use of pain killers and/or sleeping pills, while effective, should only be used under the supervision of a physician.

DRUGS: Many medications contain alpha and beta blockers used to control heart rhythms and reduce blood pressure both of which affect sleep. Talk to your doctor about the affects they may cause.

SLEEP ENVIRONMENT: Increase your chances of better sleep by controlling your sleep environment. 1) Use no/low lighting such as nightlights to minimize the effects on the internal clock; 2) Reduce noise that can prevent transitions to the deeper stages of sleep, and; 3) Maintain a comfortable temperature to avoid disruptive sleep; 4) Invest in quality bedding.

Driving without the proper amount of quality sleep makes it harder to pay attention to the road and dramatically impacts your reactions. Signs of drowsy driving are trouble focusing, heavy eyelids, an inability to remember the last stretch of road that you just drove, yawning constantly, bobbing your head, and drifting from your lane. If this starts to happen while you’re driving, find a safe place to pull over and take a quick nap or stretch, breath deeply and take a short walk, or buy a cup of caffeinated coffee to help keep you alert. STAY SAFE AND GET SOME REST!

LATE REPORTING OF CLAIMS

LATE REPORTING OF CLAIMS
Comes with consequences

Call Your Agent

So many things can happen in a short amount of time and when you delay reporting a claim, those “things” can be forgotten, embellished and/or lost forever. If it is something that can help in your defense, you don’t want it lost.

When you are involved in any type of claim that has property damage or injury, it is imperative that you let your insurance agent know as soon as possible so that the process of discovery can begin. In many instances, an insurance company can have an independent adjuster dispatched to the scene to begin the process.

Witnesses: When there are witnesses to a claim, it is critical to talk to those witnesses as soon as possible in order to get their version of the story. Details can become fuzzy or lost altogether as time goes by. Always get names and phone numbers of witnesses – especially if they cannot stay at the scene.

Your story: When you or a driver are involved in a claim, the details are so important, e.g. how many people were in a particular vehicle at that time? We see claims where individuals that were not even involved in the crash are claiming injury. Write down the details, take pictures and/or have someone in the company designated to conduct post-accident interviews.

Scene changes: The more time that goes by the more a scene can change. Skid marks fade and/or other skid marks occur, spills get cleaned and damages get repaired. When there isn’t proper documentation and examination of the scene, it becomes more difficult for a claims professional to do their job.

Unnecessary expenses: Expenses can occur when a claim is reported late to your insurance company. When a claimant’s vehicle is damaged, they will likely need a rental. The longer the life of the claim, the more rental expense is incurred. Additionally, claimants can rationalize that the insurance company is not properly tending to their claim and respond by hiring an accident attorney. These attorneys are synonymous for inflating charges.

Your damages: Another item to note is that when you are involved in a claim, your damages need to be fixed as soon as possible as well. We see claims where damaged parts from a previous crash fall off of the vehicle and cause another separate claim.

Please report your claim as soon as possible to give your claims professionals the best chance at defending you and reducing your exposure to unnecessary costs. A notice of an incident to an agent is a notice of claim. You should expect confirmation from the insurance company of the claim within a reasonable amount of time.

Spotlight on crashes

Multiple Vehicle Crash

As we have noticed an uptick in the frequency of multiple-vehicle crashes, we would like to pass on some key points to consider with respect to liability arising out of these types of crashes. The key for investigators is to determine the sequence of events. The following would be typical questions you might be asked following a crash.

      1. Were you stopped before the impact?
      2. If not, how far were you from the vehicle ahead before you made contact?
      3. How many impacts did you feel?
      4. What was the severity of each impact?
      5. Was a lane change the cause of the crash?

In addition to the information above, any photos that you could provide before the vehicles are moved would help to preserve the scene for accident investigators. As always, safety first. Do not put yourself in an unsafe area to take photos. When safe, take photos of all angles, both the whole scene and the impact areas. Take photos of signs, intersections and skidmarks. Photos go a long way in helping claims representatives to corroborate any received testimony.

An ounce of prevention is worth a pound of cure. Always give yourself enough room to stop behind the vehicle in front of you. If you are being followed too closely, increase your distance from the vehicle ahead to help prevent a rearend crash.
Another type of crash we are seeing more often is trucks backing into dock doors and stationery vehicles. These accidents have been occurring with seasoned drivers. Safety coordinators should add these accident types to their driver meeting notes as the development of bad habits and not asking for assistance is more likely to blame than actual ability.

When a parking situation is tight – especially when backing, you should always get a spotter to assist you. If the area appears to be too tight, stop and ask to have the obstacle moved to accommodate your truck and trailer size. Do not risk a claim. When backing without a spotter, be sure to get out of the truck and check for obstacles and people that might be behind and/or alongside your vehicle and trailer.

Port collisions among truckers are on the rise

portImage

 

Crashes at the ports are becoming an all too common occurrence as truckers line
up at terminal gates and jockey for position to get in and get out as painlessly as
possible.

At the port, traffic control is often an oxymoron. There can be trucks entering and exiting the gates from all different directions with line stalkers looking for the opportunity to cut in on truckers who leave room and/or attempt not to block onstreet traffic lanes. With inflamed tensions, trucks bottleneck at the gates. There is obvious work to be done for the ports and truckers to come together to keep tensions in check and the traffic flowing as smoothly as possible.

Be aware that in those instances when trucks are too close together and tensions
are heightened, collisions are occurring at an increased rate – it is a very frustrating
situation for all involved. On the insurance side, the ports aren’t allowing claims
professionals entrance inside the terminal gates to perform investigations. Truckers
need to understand that because of this, it becomes a “he said”, “she said”
scenario. And, if the other guy has photo evidence and/or witnesses to corroborate
his claim, the preponderance of evidence can favor the other guy. Our claims
professionals need you to be aware of this situation and be prepared to take photos
of the accident scene. Take wide (panoramic) shots as well as closeups, and if
you can, get names and numbers of any witnesses. Notable is that we have had
instances where a trucker who hit one of our guys produced witnesses that (while
they were at the port) were not at the collision site at the time of the collision. It was
only through photographic evidence that we were able to discredit those witnesses.

While the ports around the country are making efforts to smooth the flow of traffic
through appointments, extended gate hours and other efficiencies it is still the
responsibility of truck drivers to operate safely. And, if/when you have a collision
preserve the scene as best as you can through photos/video and get names and
numbers of any witnesses.

These simple actions will go a long way towards defending your liability and
protecting your safety record and loss ratio.

Seasonal driving tips

The wrong mapping device could send you over the edge

Before you go on your next trip, make sure you check the weather and road conditions, and oh yes… if you’re going to use a GPS device, choose one designed for commercial driving.

Example: A truck driver (just last month) drove almost to the top of Butterfield Canyon Utah where he came within inches of falling down a one hundred foot drop-off. Despite very narrow and winded roads, the driver kept going because his GPS instructed him to. Ultimately, he got to a place where he couldn’t make the turn. The rescue took six hours and meant two-thirds of his cargo had to be off-loaded so a front-end loader could lift the trailer around the hairpin turns to a place where the he was able to turn around.

Not all navigation systems are the same and the shortcut you trusted to save you time and fuel could end up costing you more than you bargained for. It is extremely important for truckers to understand important route restrictions, road and weather conditions. Commercial mapping devices choose routes based on your vehicle’s length, width, height, axle weight and hazardous materials onboard. They can track fuel purchases, list truck stop and service locations and include real-time weather overlays.

Adjust your driving to fit conditions

• Turn off your cruise control.
• If you lose traction with the road, gradually slow down. Don’t slam on the brakes.
• Use caution when driving on bridges or overpasses. Because of their elevation, the ground does not warm these surfaces and they are the first to freeze and become slippery when the temperature drops. Shaded areas also remain cooler and freeze faster.
• Know your route. Some roads are regularly maintained while others less frequently leaving the potential for dangerous obstacles and surface damage to contend with.
• Don’t drive fatigued. If you’re feeling tired, find a place where you can safely pull off the road and rest.
• Always perform a pre-trip inspection testing the heater and defroster, lights, wipers, battery and tires.
• Be sure to use antifreeze that’s good to -25°F; check and fill washer and other fluids and make sure hoses aren’t loose or brittle.
• Keep an automotive safety kit in your vehicle.

 

Underride Guards Fail Critical 30% Test

Trailer underride guards, while improved, did not pass the Insurance Institute for Highway Safety’s (IIHS) critical 30% test. According to the IIHS, trailer underride guards on modern trailers do a pretty good job at keeping vehicles from sliding underneath them, but primarily when the crash occurs directly behind the trailer. IIHS tests show that when a vehicle strikes a portion of the trailer (overlap), most trailers fail to prevent potentially deadly underrides.

In a IIHS study of 115 crashes in which a passenger vehicle struck the back of a heavy truck or semitrailer, results showed that 80% were underrides. Of those crashes involving underride, 82% were fatalities; about half of those with severe underride had overlaps of 50% or less.

IIHS engineers most recently crash-tested trailers from eight of the largest manufacturers. In each test, a 2010 Chevrolet Malibu struck a parked tractor-trailer at 35 mph. When the car was aimed at the center of the trailer, all successfully prevented the underride.  When the mid-point of the car struck the trailer edge, only one guard failed to prevent the underride.  However, when the portion of the vehicle striking the trailer was reduced to 30%, all but one failed. The 30% overlap is used by the IIHS for testing because it is the minimum overlap under which a passenger vehicle occupant’s head is likely to strike a trailer in an underride guard failure. It is important to note that in successful tests where the guards held up, the Malibu’s structure and airbags protected the dummy.
Earlier test results from the IIHS showed that the size and strength of the guards were inadequate  leading the IIHS to petition the National Highway Traffic Safety Administration (NHTSA) in 2011 for tougher standards. In that set of tests, IIHS engineers crash-tested trailers from three manufacturers (Hyundai, Vangard and Wabash). The Hyundai trailer failed all tests. Vangard failed the 50% and 30% tests while the Wabash trailer failed the 30% test.

Since 2007, under Canadian regulation, a guard must withstand about twice as much force at the point where it attaches to its vertical support compared to the U.S. rule. It’s encouraging to note that while NHTSA has not issued any additional requirements on trailer underride guards, trailer manufacturers have responded to the IIHS results by installing guards that are much stronger than required. All eight manufacturers now have underride guards meeting the Canadian standard, and none of the current designs had any difficulty passing the full-width test.

According to the IIHS, the location of the guards’ vertical supports appears to be a problem. As the supports are attached to the slider rails which allows the position of the wheels to change depending on the load, the vertical supports are located an average of 28 inches from the trailer’s edge. Manac, a Canadian manufacturer and the only one to pass the 30% test, attaches its guards to a reinforced floor and spaced just 18 inches from the edge.