from Canal
I am surprised how few people can actually explain the difference. Why would an agent ever sell specified perils when comprehensive is available? Plus there is an E & O exposure selling specified perils coverage.
So what is the difference. In specified perils, only the losses S-P-E-C-I-F-I-E-D are covered. Well that is pretty easy. So what is not covered that would be covered in a comprehensive policy?
*larceny
*glass breakage
*contact with a bird or animal ( how about a deer)
*riot or civil commotion
*substances in tanker that contaminate the trailer
*tanker acid leak that causes damage to the framer or tires
*cargo leaking into the trailer that had to be cleaned
*acid rain damaging the trucks paint
*implosion
*oder from a dead animal in the truck cab
*vermin eating the seats
While some of these types of losses are very far fetched, some are not and if you think a trucker is going to understand if his loss is not covered, I would be surprised.
Sell coverage that is available.
Wednesday, September 30, 2009
Cargo Theft Database Coming in 2010- CargoNet
From Fleetowner
Do you think our insurance carriers will have an interest in this?
As more and more attention is paid to cargo theft, the lack of a comprehensive national database tying individual states together with local and federal authorities, insurance companies and carriers alike, has become a roadblock to reducing the crime.
But ISO and the National Insurance Crime Bureau (NICB) are looking to combat that problem by launching what they said is the first “nationally coordinated data-sharing system” to meet the needs of all the affected parties. The groups said the new database, called CargoNet, will launch in early 2010.
“This is a critical step in the plan that the industry and law enforcement mapped out in November 2006, when the National Cargo Theft Task Force recommended the development of intelligence databases and information sharing,” said Joe Wehrle, president & CEO of NICB. “Working with our members and law enforcement, NICB has been making progress against cargo theft on many fronts. We have recovered stolen cargo, developed intelligence, and dissolved organized groups behind the thefts. If CargoNet were in place today, I’m sure we’d be seeing a lot more recoveries, and we’d be making thieves think twice about stealing these loads.”
The organizations said that creation of the national database will allow local, state and federal law enforcement to respond quickly to reports of theft by networking existing databases with secure reporting and analytic functions. ISO, which is a risk management firm, has seen first-hand the damage the multi-billion cargo theft racket has wrought.
“ISO’s track record of building and managing sophisticated and secure systems to share sensitive loss and crime data is ideally suited to building CargoNet,” said Vincent Cialdella, ISO senior vp. “We are greatly encouraged by the strong support we are receiving from leading cargo insurers. This initiative would not be possible without it. We are also encouraged by discussions we have had with transportation companies, manufacturers, and retailers, given the crucial role they play in this initiative.”
The new network will also include training and investigative support for law enforcement as well as theft prevention services, the organizations said.
NICB is a non-profit dedicated to preventing insurance fraud and vehicle theft. It is supported by more than 1,000 property and casualty insurance companies and self-insured organizations.
Do you think our insurance carriers will have an interest in this?
As more and more attention is paid to cargo theft, the lack of a comprehensive national database tying individual states together with local and federal authorities, insurance companies and carriers alike, has become a roadblock to reducing the crime.
But ISO and the National Insurance Crime Bureau (NICB) are looking to combat that problem by launching what they said is the first “nationally coordinated data-sharing system” to meet the needs of all the affected parties. The groups said the new database, called CargoNet, will launch in early 2010.
“This is a critical step in the plan that the industry and law enforcement mapped out in November 2006, when the National Cargo Theft Task Force recommended the development of intelligence databases and information sharing,” said Joe Wehrle, president & CEO of NICB. “Working with our members and law enforcement, NICB has been making progress against cargo theft on many fronts. We have recovered stolen cargo, developed intelligence, and dissolved organized groups behind the thefts. If CargoNet were in place today, I’m sure we’d be seeing a lot more recoveries, and we’d be making thieves think twice about stealing these loads.”
The organizations said that creation of the national database will allow local, state and federal law enforcement to respond quickly to reports of theft by networking existing databases with secure reporting and analytic functions. ISO, which is a risk management firm, has seen first-hand the damage the multi-billion cargo theft racket has wrought.
“ISO’s track record of building and managing sophisticated and secure systems to share sensitive loss and crime data is ideally suited to building CargoNet,” said Vincent Cialdella, ISO senior vp. “We are greatly encouraged by the strong support we are receiving from leading cargo insurers. This initiative would not be possible without it. We are also encouraged by discussions we have had with transportation companies, manufacturers, and retailers, given the crucial role they play in this initiative.”
The new network will also include training and investigative support for law enforcement as well as theft prevention services, the organizations said.
NICB is a non-profit dedicated to preventing insurance fraud and vehicle theft. It is supported by more than 1,000 property and casualty insurance companies and self-insured organizations.
Monday, September 28, 2009
Helping Truckers Fix their CSP ( Company Safety Profile)
Most trucking agents are aware that the SAFER report is one of the most scrutinized public tools available to underwriters. But what most agents are not aware of what the insured should do to fix it. The Safer reports are not perfect and can penalize an insured greatly at renewal time. While the insured should know what to do, it would be smart for you as an agent to know how as well.
It would be very smart to:
1) ask the insured if there are any errors in SAFER when working on a submission
2) finding out if the insured has sent documented evidence to correct the issue
3) getting a copy of the documented evidence and getting it to the insurance company
From Professional Safety Consulting
MONITOR YOUR CARRIER’S PERFORMANCE
The Company Safety Profile (CSP) is the most comprehensive summary of a carrier’s safety performance. It includes operational data, history of Safety/Compliance Reviews and Federal safety ratings, accident history and roadside inspection data.
Carriers should periodically obtain their CSP and conduct a thorough review. A CSP can be ordered online through SAFER (Safety And Fitness Electronic Records) at http://safer.fmcsa.dot.gov. Under “FMCSA Services” click “Company Safety Profile”, enter your DOT number and e-mail address, and follow the instructions.
If you find inaccurate information on your profile:
1.
Write to the agency that conducted the inspection or completed the accident report.
2.
Explain in your letter what data or record is in error, and submit documentation to support your correction request. The agency is then responsible for making the correction and keeping you informed of the status.
Or, you can file your concern online through the FMCSA DataQs system at https://dataqs.fmcsa.dot.gov. Through this system, your concerns are automatically forwarded to the appropriate agency for resolution.
It would be very smart to:
1) ask the insured if there are any errors in SAFER when working on a submission
2) finding out if the insured has sent documented evidence to correct the issue
3) getting a copy of the documented evidence and getting it to the insurance company
From Professional Safety Consulting
MONITOR YOUR CARRIER’S PERFORMANCE
The Company Safety Profile (CSP) is the most comprehensive summary of a carrier’s safety performance. It includes operational data, history of Safety/Compliance Reviews and Federal safety ratings, accident history and roadside inspection data.
Carriers should periodically obtain their CSP and conduct a thorough review. A CSP can be ordered online through SAFER (Safety And Fitness Electronic Records) at http://safer.fmcsa.dot.gov. Under “FMCSA Services” click “Company Safety Profile”, enter your DOT number and e-mail address, and follow the instructions.
If you find inaccurate information on your profile:
1.
Write to the agency that conducted the inspection or completed the accident report.
2.
Explain in your letter what data or record is in error, and submit documentation to support your correction request. The agency is then responsible for making the correction and keeping you informed of the status.
Or, you can file your concern online through the FMCSA DataQs system at https://dataqs.fmcsa.dot.gov. Through this system, your concerns are automatically forwarded to the appropriate agency for resolution.
Cell Phones and Truckers- Like Nancy said, "Just say no".
From the Insurance Journal
I question even if cell phones are banned if it will be hard to catch them in the act. It would seem to make sense that if indeed cell phones are banned that there is a fine or penalty for having a cell phone without a wireless or bluetooth to it. Here are excerpts from the article:
Safety investigators told federal regulators three years ago that it was dangerous for bus drivers to talk on cell phones while driving and recommended a ban.
Yet the regulatory agency that would write new rules on cell phone use by commercial drivers, the Federal Motor Carrier Administration, has done little more than study the issue.
Now, after several high profile accidents that focused public attention on using cell phones on the road, the Obama administration has decided to act on the recommendation, which was left hanging by the Bush administration.
Transportation Secretary Ray LaHood will convene a two-day summit next week on distracted driving and plans to announce actions to address cell phone use by bus and truck drivers, said spokeswoman Jill Zuckman.
The agency responded that it would not only conduct studies to learn whether a new rule was needed and whether cell phone use by all commercial drivers, including truck drivers, should be prohibited. It hoped to have answers last October.
An official for the motor carrier administration declined comment when contacted by The Associated Press.
Research clearly shows that cell phone use distracts drivers, safety experts said.
"When you are texting and talking on the phone, you might be going through the motions of doing what you need to be doing, but your head is not in the game,'' Hersman said.
As research has mounted, industry's resistance to regulation has faded.
The American Trucking Associations is neutral on a ban on cell phone use by truck drivers until they see the wording of a proposal, but "we think cell phones and other electronic equipment should have some policies and regulations on them to prevent their misuse,'' said spokesman Clayton Boyce.
Even the wireless industry, formerly opponents of restrictions, supports a texting ban and is neutral on restricting cell phone use by drivers.
Seventeen states and Washington prohibit school bus drivers from using cell phones while driving. Eighteen states and Washington have passed laws making texting while driving illegal.
A group of Democratic members of Congress introduced a bill this summer requiring states to ban texting or e-mailing while operating a moving vehicle or lose 25 percent of their annual federal highway funding. It would be patterned after Congress' requirement that states adopt a national drunken driving ban.
I question even if cell phones are banned if it will be hard to catch them in the act. It would seem to make sense that if indeed cell phones are banned that there is a fine or penalty for having a cell phone without a wireless or bluetooth to it. Here are excerpts from the article:
Safety investigators told federal regulators three years ago that it was dangerous for bus drivers to talk on cell phones while driving and recommended a ban.
Yet the regulatory agency that would write new rules on cell phone use by commercial drivers, the Federal Motor Carrier Administration, has done little more than study the issue.
Now, after several high profile accidents that focused public attention on using cell phones on the road, the Obama administration has decided to act on the recommendation, which was left hanging by the Bush administration.
Transportation Secretary Ray LaHood will convene a two-day summit next week on distracted driving and plans to announce actions to address cell phone use by bus and truck drivers, said spokeswoman Jill Zuckman.
The agency responded that it would not only conduct studies to learn whether a new rule was needed and whether cell phone use by all commercial drivers, including truck drivers, should be prohibited. It hoped to have answers last October.
An official for the motor carrier administration declined comment when contacted by The Associated Press.
Research clearly shows that cell phone use distracts drivers, safety experts said.
"When you are texting and talking on the phone, you might be going through the motions of doing what you need to be doing, but your head is not in the game,'' Hersman said.
As research has mounted, industry's resistance to regulation has faded.
The American Trucking Associations is neutral on a ban on cell phone use by truck drivers until they see the wording of a proposal, but "we think cell phones and other electronic equipment should have some policies and regulations on them to prevent their misuse,'' said spokesman Clayton Boyce.
Even the wireless industry, formerly opponents of restrictions, supports a texting ban and is neutral on restricting cell phone use by drivers.
Seventeen states and Washington prohibit school bus drivers from using cell phones while driving. Eighteen states and Washington have passed laws making texting while driving illegal.
A group of Democratic members of Congress introduced a bill this summer requiring states to ban texting or e-mailing while operating a moving vehicle or lose 25 percent of their annual federal highway funding. It would be patterned after Congress' requirement that states adopt a national drunken driving ban.
Tuesday, September 22, 2009
Collision Repair Costs Down
From American Agent and Broker
Thought just the economy was down and trucking insurance rates were down, how about collision repair costs?
Well they are down too. 3% as a matter of fact.
The decrease us due to recession-related factors and reflects the aging fleet and lower actual cash values.
The average gross collision value of a private passenger vehicle is $2729 ( probably higher if a tractor-trailer hits it). The average cash value of vehicles appraised for collision losses is $11,995.
The average gross third party property damage appraisal caused by an insured driver is $2156 (again probably higher if hit by a tractor-trailer). The average cash value for vehicles involved in property damage claims is $10,741.
Thought just the economy was down and trucking insurance rates were down, how about collision repair costs?
Well they are down too. 3% as a matter of fact.
The decrease us due to recession-related factors and reflects the aging fleet and lower actual cash values.
The average gross collision value of a private passenger vehicle is $2729 ( probably higher if a tractor-trailer hits it). The average cash value of vehicles appraised for collision losses is $11,995.
The average gross third party property damage appraisal caused by an insured driver is $2156 (again probably higher if hit by a tractor-trailer). The average cash value for vehicles involved in property damage claims is $10,741.
Monday, September 14, 2009
Owner-Operator Agreements- Best Practices
If you are talking to your truckers, it is important to understand the contractural relationship and help them understand what needs to be a part of a lease to protect a truckers interest.
See the attached article from Robert Franklin from Big Truck TV
In working with motor carriers and private fleet operators, one of the most frequently overlooked issues we encounter is the failure to have an effective equipment lease in use with owner operators. There have been a number of lawsuits filed by OOIDA based on defective leases. Although the amount owed to any one contractor may be relatively small, such a case often qualifies for class action status, which can easily result in millions of dollars in exposure. Worse yet, you generally will have no insurance for such a lawsuit. Some such suits have driven motor carriers to bankruptcy.
The regulations governing equipment leases (49 CFR 376.12) are very specific in terms of minimum "do's and don'ts". The most frequently encountered deficiencies are failure to include the required language regarding the carrier's "exclusive possession, control and use" of the equipment during the lease; failure to pay interest on escrow funds; and failure to disclose "admin fees" charged in conjunction with insurance purchased through the carrier.
In addition to compliance with the applicable regulations, the lease is, after all, a contract, and there are a number of other important provisions which should be addressed. For example, one will generally want to include provisions regarding confidentiality and non-competition, in order to avoid having the contractor "back solicit" the carrier's customers. One should also include language prohibiting markings on the equipment, other than those required by DOT, without the carrier's prior written agreement, as such markings may increase exposure for the motor carrier in a related accident. For example, having "monster jaws" on the grill of the tractor may have an extremely inflammatory impact on a jury when that power unit is involved in a serious accident. One may also wish to include an indemnification requirement for accidents and fines caused by the contractor. There are many other typical contract issues (e.g. choice of law, venue, arbitration, etc.) which should also be addressed.
Additional issues arise when the contractor is subject to a "lease-purchase" contract regarding his or her tractor. That contract must give the contractor sufficient control over the tractor in order to properly qualify him as an "owner" for FMCSR purposes, and as an independent contractor for tax and workers' compensation purposes. Moreover, if the carrier wants to be able to deduct sums owed by the contractor from his or her settlement checks (which it almost certainly will want to be able to do), the regulations require that the terms of the lease-purchase agreement be incorporated into the lease's charge-back provision. That can usually be accomplished by attaching a copy of the lease purchase to the lease and incorporating it by reference.
If you haven't had your equipment lease reviewed and updated for some time, you should do so as soon as possible. While there is a cost associated with doing so, that cost is minimal, and pales in comparison to the exposure which the carrier may face without a proper equipment lease in place.
See the attached article from Robert Franklin from Big Truck TV
In working with motor carriers and private fleet operators, one of the most frequently overlooked issues we encounter is the failure to have an effective equipment lease in use with owner operators. There have been a number of lawsuits filed by OOIDA based on defective leases. Although the amount owed to any one contractor may be relatively small, such a case often qualifies for class action status, which can easily result in millions of dollars in exposure. Worse yet, you generally will have no insurance for such a lawsuit. Some such suits have driven motor carriers to bankruptcy.
The regulations governing equipment leases (49 CFR 376.12) are very specific in terms of minimum "do's and don'ts". The most frequently encountered deficiencies are failure to include the required language regarding the carrier's "exclusive possession, control and use" of the equipment during the lease; failure to pay interest on escrow funds; and failure to disclose "admin fees" charged in conjunction with insurance purchased through the carrier.
In addition to compliance with the applicable regulations, the lease is, after all, a contract, and there are a number of other important provisions which should be addressed. For example, one will generally want to include provisions regarding confidentiality and non-competition, in order to avoid having the contractor "back solicit" the carrier's customers. One should also include language prohibiting markings on the equipment, other than those required by DOT, without the carrier's prior written agreement, as such markings may increase exposure for the motor carrier in a related accident. For example, having "monster jaws" on the grill of the tractor may have an extremely inflammatory impact on a jury when that power unit is involved in a serious accident. One may also wish to include an indemnification requirement for accidents and fines caused by the contractor. There are many other typical contract issues (e.g. choice of law, venue, arbitration, etc.) which should also be addressed.
Additional issues arise when the contractor is subject to a "lease-purchase" contract regarding his or her tractor. That contract must give the contractor sufficient control over the tractor in order to properly qualify him as an "owner" for FMCSR purposes, and as an independent contractor for tax and workers' compensation purposes. Moreover, if the carrier wants to be able to deduct sums owed by the contractor from his or her settlement checks (which it almost certainly will want to be able to do), the regulations require that the terms of the lease-purchase agreement be incorporated into the lease's charge-back provision. That can usually be accomplished by attaching a copy of the lease purchase to the lease and incorporating it by reference.
If you haven't had your equipment lease reviewed and updated for some time, you should do so as soon as possible. While there is a cost associated with doing so, that cost is minimal, and pales in comparison to the exposure which the carrier may face without a proper equipment lease in place.
Wednesday, September 2, 2009
Auto Hauler Cargo Question
From Markel
Most insurance companies write specified perils coverage on auto haulers- as there are too many times they pay losses for cargo coverage that are due to employee error and these insurance carriers want to limit their losses from these situations.
What about Collision of the load which is usually covered versus collision with a curb which is excluded. What is the difference?
Note this generally has to do with Flat Bed loads, as Van type trailers would enclose the cargo and the trailer would have to collide with the bridge so coverage is afforded. If on flat bed, the "covered property" would be exposed and this would allow coverage for that exposed "covered property" if it struck the bridge ("any other object") and the tractor ("vehicle") or trailer ("vehicle") did not. The bridge is considered "any other object", therefore coverage afforded. The exclusionary language of "Collision of Covered Property" is referring to collision that is proximately caused by collision with the "vehicle" (i.e., Load shift, improper securing of load, etc) or proximately caused by "collision with adjacent curbing, or collision with the rails or ties of street, steam or other railroad". If the "vehicle" overturns and "covered property" strikes any of the excluded objects there would be coverage for the "covered property" because the proximate cause of loss was the overturn, not the striking of the excluded objects.
The last explanation, if needed, is for "Collision will not include traverse off a road or pathway". Basically, if "vehicle" is chosen to be pulled from "road or pathway" being traveled as a parking area, shortcut, avoiding an animal, etc, and this rough ride causes damage to the "covered property" this will not be considered a "collision" and coverage will not be provided.
Collision of Covered Property is extended to include as a Peril, the accidental collision of the Covered Property with any other object, excluding collision with the vehicle, or collision with any portion of the road or pathway being traveled by the vehicle, or collision with adjacent curbing, or collision with the rails or ties of street, steam or other railroad. Collision will not include traverse off a road or pathway.
Most insurance companies write specified perils coverage on auto haulers- as there are too many times they pay losses for cargo coverage that are due to employee error and these insurance carriers want to limit their losses from these situations.
What about Collision of the load which is usually covered versus collision with a curb which is excluded. What is the difference?
Note this generally has to do with Flat Bed loads, as Van type trailers would enclose the cargo and the trailer would have to collide with the bridge so coverage is afforded. If on flat bed, the "covered property" would be exposed and this would allow coverage for that exposed "covered property" if it struck the bridge ("any other object") and the tractor ("vehicle") or trailer ("vehicle") did not. The bridge is considered "any other object", therefore coverage afforded. The exclusionary language of "Collision of Covered Property" is referring to collision that is proximately caused by collision with the "vehicle" (i.e., Load shift, improper securing of load, etc) or proximately caused by "collision with adjacent curbing, or collision with the rails or ties of street, steam or other railroad". If the "vehicle" overturns and "covered property" strikes any of the excluded objects there would be coverage for the "covered property" because the proximate cause of loss was the overturn, not the striking of the excluded objects.
The last explanation, if needed, is for "Collision will not include traverse off a road or pathway". Basically, if "vehicle" is chosen to be pulled from "road or pathway" being traveled as a parking area, shortcut, avoiding an animal, etc, and this rough ride causes damage to the "covered property" this will not be considered a "collision" and coverage will not be provided.
Collision of Covered Property is extended to include as a Peril, the accidental collision of the Covered Property with any other object, excluding collision with the vehicle, or collision with any portion of the road or pathway being traveled by the vehicle, or collision with adjacent curbing, or collision with the rails or ties of street, steam or other railroad. Collision will not include traverse off a road or pathway.
Tuesday, September 1, 2009
How much does it cost to maintain a truck
from Big Truck TV
Insurance is an expense for a trucker and so is vehicle maintenance. When you look at older and younger fleets, it's important to understand how much it cost the trucker to run his fleet from a maintenance perspective.
Maintenance is a major part of every trucking company’s operation. The cost of maintaining a truck increasing as it ages – from 2 cents per mile for a new truck to 10 cents per mile for a truck 5 years old or older. This represents a 400% increase in annual maintenance expenses in just 5 years! With a tightened credit market more carriers are unable to finance new trucks and as a result are either holding on to their older trucks longer or are buying used. This inevatibly puts a strain on maintenance budgets.
Insurance is an expense for a trucker and so is vehicle maintenance. When you look at older and younger fleets, it's important to understand how much it cost the trucker to run his fleet from a maintenance perspective.
Maintenance is a major part of every trucking company’s operation. The cost of maintaining a truck increasing as it ages – from 2 cents per mile for a new truck to 10 cents per mile for a truck 5 years old or older. This represents a 400% increase in annual maintenance expenses in just 5 years! With a tightened credit market more carriers are unable to finance new trucks and as a result are either holding on to their older trucks longer or are buying used. This inevatibly puts a strain on maintenance budgets.
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