It is no great secret: Insuring big rigs gets more expensive by the year. This is even worse during our current COVID-19 crisis. Fleets are experiencing what some refer to as a \u201chard\u201d insurance market. This refers to an insurance industry cycle where insurance companies impose far more onerous underwriting standards and decrease the levels of coverage they will support.<\/p>\n\n\n\n
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As a result, these moves have a knock-on effect and cause insurance supplies to contract even as premiums rise. Depending on the frequency or severity of claims being submitted, some trucking companies<\/a> are hit harder than others. Still, no matter how a trucking companies operates, one thing is for sure, insurance rates have doubled<\/a> for long-haul trucks in the past 10 years. <\/p>\n\n\n\n Insurance Costs See no Limit<\/strong><\/p>\n\n\n\n Many trucking companies are witnessing premium increases for\nthe third year in a row or more. As bodily injury lawsuits skyrocket and\ninsurance companies take notice, small trucking companies are feeling the\nsqueeze. Why? Because commercial auto insurance has been one of the most\nunprofitable segments in the insurance industry. <\/p>\n\n\n\n As a result, many insurance companies are leaving the space\naltogether, which puts trucking companies in a bind. With less policies to\nchoose from and those that are left being quite expensive, there is little a\ncompany can do. Insurance companies are incurring losses on truck policies and\nhave become quite selective in who they will do new business with moving\nforward. <\/p>\n\n\n\n Fortunately, fleets are not without recourse. Trucking\ncompanies have their own destiny in the palm of their hands. Improving safety\nprograms, taking care of truck drivers, and partnering with the right insurance\nagent will go a long way towards reducing insurance costs and keeping a green\nbottom line. <\/p>\n\n\n\n In the end, it doesn\u2019t really matter what kind of insurance a trucking company has. They keep costs low by properly managing risk. And managing risk is all about focusing on safety. Trucking companies that focus on fleet safety programs have fewer crashes. It is a simple, irrefutable fact. As a result, successful trucking companies<\/a> make sure they focus on safety. <\/p>\n\n\n\n Insurance companies will look at your CSA scores, claims history,\nand other safety-related information, such as truck driver turnover, to\nevaluate you. Once their evaluation is complete, they will create a risk\nprofile. This is where your behavior as a company comes into play. If your risk\nprofile is worse than other trucking companies of your same size and\noperational type, you will likely face higher insurance premiums.<\/p>\n\n\n\n Create a Safety Program<\/strong><\/p>\n\n\n\n Insurance companies want to see that those they ensure are\ntaking a proactive approach o managing risk and increasing fleet safety. This\ngoes beyond merely collecting data and ensuring you are in dull DOT compliance.\nTrucking companies with low insurance premiums get creative with how they run\ntheir operation. They work hard to keep safety concepts at the forefront of their\ntruck drivers\u2019 minds and actions by instituting training on vehicle\ninspections, hours of service regulations and defensive driving.<\/p>\n\n\n\n A first step in comprehensive safety program should be ensuring everyone is aware of their CSA scores. Everyone in your trucking company needs to understand how important it is to maintain and improve CSA scores. Everyone in the organization needs to know what CSA is and how they can contribute to lower scores. Truck drivers who incur the most violations need to be coached and educated on why improvement is necessary. Always remember that it is usually only a small percentage of your truck drivers that have issues with roadside inspections.<\/p>\n\n\n\n <\/p>\n\n\n\n <\/p>\n\n\n\n Reducing CSA scores involves eliminating common violations.\nRemember that some violations should be easy to prevent. A couple quick\nexamples are simple maintenance violations for tires and lights. If your truck\ndrivers are not completing adequate pre-trip inspections, you may wind up with\nviolations that could have been easily avoided. <\/p>\n\n\n\n Unsafe driving violations, including speeding, not wearing a\nseatbelt, and using a cell phone while behind the wheel will cause a CSA score\nto skyrocket. How do fleet managers avoid this? By creating and running truck\ndriver training and accountability programs. Most hours of service violations\nthat happen in the post-ELD landscape are minor and can be corrected by\nproviding additional education to drivers and supervisors.<\/p>\n\n\n\n Focus on the People<\/strong><\/p>\n\n\n\n Trucking companies that focus on the people that make the\ncompany run are the most successful. They are proud of what they do right, and\nthey spend time actively talking about it. They have reputations their peers\nare envious of. Your first step in operating a fleet that takes safety\nseriously and keeps insurance costs low is to hire the right people. <\/p>\n\n\n\n Do you know your insurance company\u2019s preferred hiring\nguidelines? If so, have you communicated it to new hires. When you have the\nchance, do you review the candidate\u2019s MVR and PSP closely as well as conduct a\npre-hire road test? Make sure you utilize an MVR monitoring service to monitor\nyour truck drivers\u2019 license status on an ongoing basis, so you\u2019ll be aware of\nsuspensions and downgrades. These are must-dos if you want to operate a\ntrucking company that isn\u2019t drowning in insurance costs.<\/p>\n\n\n\n Make sure you also focus on empowering your truck drivers\nand motivating them to follow all safety protocols. Do you have incentive\nprograms to reward those who have strong safety records? Do you call out truck\ndrivers who reach positive milestones? You could offer company-branded gear or\nother monetary incentives. <\/p>\n\n\n\n In the end, focusing on your people is all about\naccountability; accountability on your part and on the part of those who are\ncarrying out your wishes. Both truck drivers and fleet managers both must live\nand breathe industry best practices and company rules. They also need to know\nwhat will happen when violations occur. <\/p>\n\n\n\n A company culture that promotes following the rules and\npaying attention to preventing minor mistakes succeeds above all others. And\nthese tenets need to be followed at all levels of the organization.\nConsequences for breaking rules or missing guidelines needs to be appropriate\nand consistently implemented, so that everyone understands what to expect.\nThere should be no favorites. <\/p>\n\n\n\n A lot of fleets struggle to implement effective safety\nprograms. But not all. Trucking companies that pay attention to their safety\nprograms wouldn\u2019t do business any other way. Even more, they are not shy to let\ntheir insurance carrier know what they have done to improve their levels of\noverall safety. They provide examples of best practices, such as monthly safety\nmeetings, telematics usage, and having a strong claims communication protocol.\nThey also require a specific level of experience for all positions and operate\na non-punitive disciplinary program. Ongoing education is a must. <\/p>\n\n\n\n Find the Right Broker<\/strong><\/p>\n\n\n\n Trucking companies who deftly manage the insurance landscape\npartner with an insurance broker who knows their business best. Fleet managers\ndo not have the time or training to become insurance experts. That is why it is\nbest to partner with someone who can be trusted; someone who knows the\nparticulars of that operation. <\/p>\n\n\n\n Like anything else in life, your partnership with your\ninsurance carrier is built on trust. The last thing you want to do is change\ninsurance companies every year, which would likely result in higher pricing.\nInstead, built a long-term relationship with an agent who is less likely t\noverreact to negative news. You also want to meet with them regularly and plan\neach renewal at least six months in advance. <\/p>\n\n\n\n Also come prepared with your story. Insurance underwriters\nwill learn about your losses and safety performance regardless. That is why it\nis best to take a proactive approach and let your insurance broker know all the\ndetails of your operation. Are you doing anything specific to prevent future\nlosses? If so, they should know!<\/p>\n\n\n\n You must also make sure you are familiar with specific types\nof losses. Also speak to loss trends within your business. If rear-end crashes\nare common in your fleet, make sure you are ready to talk about what you are\ndoing to ensure they are prevented in the future. <\/p>\n\n\n\n Beyond utilizing the right partner, you need to operate in a responsible way. Make sur all claims are reported in a timely manner and that documentation is thorough. Work closely with your broker to find best case outcomes when cases arise. The goal should always be to get your claim resolved with minimal fuss. Consistent communication throughout the year will help you meet these goals. <\/p>\n\n\n\n <\/p>\n\n\n\n <\/p>\n\n\n\n Through an effective safety program and due diligence when\nworking with an insurance partner, your fleet can set itself up for future success.\nMitigate your insurance risk by keeping the above-mentioned best practices in\nmind and streamline your operation in a post-COVID\nworld<\/a>. <\/p>\n","protected":false},"excerpt":{"rendered":"