Jean Gardner at CAB ( Central Analysis Bureau) is a pro in our business. She and CAB do a very nice monthly newsletter. Here are some items I think are worthy of mention:
1)CARGO THEFT - The Wall Street Journal reported that over 5 days in January, a truck load of consumer electronics, a truck load of paper and a truckload of chairs were stolen. Accordingly to FreightWatch, $487 million in goods were stolen in 2009, a 67% increase over the last year. That involved 859 truckloads of goods. That is a lot of cargo being taken. With economic conditions still not good, cargo theft is likely to continue to rise, with professionals and amateurs taking a stab at the crime. Rest stop thefts are reportedly the largest group so pay attention to where your carrier is operating and whether he will need to park trailers at rest stops.
( editors note: cargo theft data is all over the map and the industry is working to get better information. My personal thoughts is that this represents only reported goods and I would say there are very substantial cases of underreporting here.)
2)DELAY EXPOSURE - As those in the cargo industry know, Wal-Mart has long led the way in imposing requirements on how, when and where its product will move through the country. If a Wal-Mart imposed obligation ultimately works that obligations then begins to be imposed by many shippers. It is now reported that Wal-Mart has implemented penalties for shipments which are not delivered within its required deadline, which allows for a 4 day window for delivery. While most cargo policies exclude damages caused by delay, this is an additional exposure to a motor carrier which needs to be considered. ( editors note: delay is a common exclusion under every motor truck cargo form. Look for the industry to be asked to include coverage for delay.)
3)TRUCKING BANKRUPTCIES - Avondale Partners has released its report on the 4th quarter study of trucking bankruptcies. 445 fleets failed in the 4th quarter. A total of 21,010 trucks came off the road, more than double what was lost in 2008. Avondale indicates that they do not expect the first quarter of this year to be any better as fleets which fought hard to stay afloat are simply losing the momentum needed to stay alive.
4)TWIC CARDS - For those of you unfamiliar with this term, a TWIC is a transportation worker identification credential card. Over 1.5 billion have been issued thus far and the number is growing. The card, which is issued by the TSA, verifies the driver and is required in many pier and airport trucking operations. It is taking on added use as shippers seek to require those cards as evidence of a driver’s identity when picking up a shipment. Is this information which an underwriter would consider in evaluating the motor carrier’s exposure? Presumably, the more drivers who have been vetted by the TSA the less likelihood there is of cargo theft by drivers and the ever increasing imposter losses. ( editors note: I had never heard of TWIC. This is one step before having a national driver card which makes sense for our industry).
Have a great March.
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Very interesting series of items. I have one nit, however. TWICs are currently being issued to people who need unescorted access to the "secure areas" of shore facilities and US-flag vessels regulated under the Maritime Transportation Security Act. Almost 1.5 Million, rather than Billion, have been printed so far.
ReplyDeleteAs evidenced by the name, Transportation Worker Identification Credential, the card was originally envisioned for transportation workers in all modes. But last year, TSA (which manages the program) put out a notice requesting input on what a uniform airport credential ought to look like--so apparently they're now thinking of something other than the existing TWIC. Who knows what railroad workers, or truckers who don't service ports, will wind up with.
As an aside, there's nothing on the front of the card to indicate it's a Government ID. On the back, in fine print, it says it's issued under authority of the US Government and it asks you to to mail to TSA if you find it.
It also has a computer chip for tracking. I hope this will also helping to eliminate cargo and identinty theft.
ReplyDeleteJustice Motor Carrier,
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