Tag: truck insurance

Top 10 Mistakes Truck Owners Make When Choosing Insurance Coverage

Western Truck Insurance

Buying insurance to protect your trucking operation is a serious business. Here are the top 10 pitfalls to avoid when looking for coverage.

  1. Working with a generalist insurance agency. Trucking is a niche business and requires an agency that understands your operation, the exposures you face, and how to address them. You want an insurance agency with years of experience that specializes in trucking.
  2. Skimping on coverage. A common mistake truck owners make is not buying enough coverage. While price is a consideration, it’s critical to look at the risks associated with not having the right coverage features and limits in place to address those risks. The out-of-pocket expenses in the event of a claim could be financially devastating.
  3. Buying the least expensive policy. Again, price is always a consideration, but if you choose the cheapest policy available, you may end up with limited coverage and higher deductibles, leaving you vulnerable in the event of an accident.
  4. Not understanding what the policy covers. It’s essential to take the time to review your policy so you know what is and isn’t covered. You don’t want any surprises if you have a claim. A trucking insurance specialist can review your policy features and coverage terms and conditions.
  5. Failure to disclose all relevant information. Be honest and transparent during the application process. If you fail to disclose pertinent information, including the driver’s history of accidents or violations, the insurance company can deny your claim and raise your rates down the road.
  6. Outdated policy information. As your business changes, be sure to notify your agent so your insurance is up to date. You may have expanded your operation and require higher limits. You want to ensure you have the right coverage in place to safeguard your assets.
  7. Choosing lower limits. Your liability limits should reflect the assets you have at risk. The minimum state-mandated requirements may not be enough to protect your assets. Today’s litigious environment and high verdicts in trucking accidents require a close look at the Liability limits you buy.
  8. Selecting the wrong deductible option. You want to choose a deductible that is aligned with what you can afford to pay and what makes most sense between the cost savings and the increased deductible.
  9. Inaccurate information on your vehicle lists. Make sure your equipment list is correct. If you make mistakes on your equipment list, you can be overcharged or undercharged for the physical damage portion of your Commercial Trucking Insurance premium, or worse yet,  have a claim denied because the vehicle was not on the policy.  
  10.  Paying for insurance you don’t need. This is another reason to work with a trucking insurance specialist and understand what your insurance covers. You don’t want to pay for unnecessary coverage or limits you don’t need.

About Western Truck Insurance Services

Western Truck Insurance Services is an insurance brokerage specializing in commercial truck insurance. We know this stuff and want to make sure you do, too. Our clients appreciate our dedication to finding competitive rates and offering unparalleled service beyond excellent insurance options. They also value how our state-of-the-art automation provides lightning-fast Truck insurance quotes, customer service, insurance certificates, and coverage changes. Contact us today at (800) 937-8785 to learn more.

On the Road with Workers’ Compensation and Occupational Accident Injury Insurance

Western Truck Insurance

Workers’ Compensation and Occupational Accident Injury Insurance are two distinct types of coverage designed to address different aspects of workplace injuries in the trucking industry.

Workers’ Compensation Insurance

A statutory form of insurance, Workers’ Compensation insurance provides benefits to employees who suffer work-related injuries or illnesses. It is designed to protect both employees and employers in the event of workplace accidents. The policy typically covers medical expenses, rehabilitation costs, and a portion of lost wages for employees who are injured or become ill while performing job-related duties. It may also provide benefits to the dependents of workers who suffer fatal injuries.

Employees are entitled to benefits regardless of fault, and, in exchange, they generally cannot sue their employer for negligence in most cases. The coverage helps ensure injured workers receive prompt medical care and financial support, promoting a quicker return to work.

Occupational Accident Injury Insurance

This policy covers medical expenses, disability benefits, and accidental death benefits for independent contractors or owner-operators who are not covered by traditional Workers’ Compensation insurance.

Occupational Accident Insurance is customizable, allowing individuals to choose coverage limits and benefits tailored to their needs. It may cover medical expenses, disability income, accidental death and dismemberment benefits, and other related costs resulting from work-related injuries.

Unlike Workers’ Compensation, Occupational Accident Injury Insurance is not mandated by state law. It is a voluntary coverage that independent contractors or owner-operators can purchase to protect themselves in case of work-related injuries, or the policy can be sponsored by a motor carrier.

In sponsoring Occupational Accident Injury Insurance, motor carriers can attract and retain independent contractors by providing them with a measure of protection in the event of work-related accidents or injuries. Furthermore, providing this coverage can assist motor carriers in differentiating themselves from their competition. It demonstrates that the motor carrier cares about the general well-being and safety of its independent contractors. When it comes to hiring and maintaining experienced independent contractors, this can be a big selling point.

It’s important for trucking companies to carefully evaluate the makeup of their workforce, including employees and independent contractors, to determine the appropriate insurance coverage. In many cases, a combination of Workers’ Compensation for employees and Occupational Accident Insurance for independent contractors may be the most comprehensive approach to address the diverse needs within the trucking industry.

About Western Truck Insurance Services

Western Truck Insurance Services is an insurance brokerage specializing in commercial truck insurance. We know this stuff and want to make sure you do, too. Our clients appreciate our dedication to finding competitive rates and offering unparalleled service beyond excellent insurance options. They also value how our state-of-the-art automation provides lightning-fast truck insurance quotes, customer service, insurance certificates, and coverage changes. Contact us today at (800) 937-8785 to learn more.

The Importance of Small Trucking Fleets in Freight Transportation

Western Truck Insurance

The trucking industry is responsible for moving 72.5% of our country’s freight. Small trucking fleets, characterized by six or fewer vehicles, are responsible for handling 91.5% of this freight, demonstrating the significant role they play in the movement of goods across the country. Following are several reasons why we rely on small trucking fleets to transport our goods.

Regional and Local Specialization

Small trucking fleets are frequently family-owned businesses that specialize in serving certain regions or localities. They are well versed in local roads, routes, and customer requirements, allowing them to provide effective and timely delivery services. Their local presence helps get freight to destinations that larger carriers may find difficult to reach.

Nimble

Small trucking fleets can respond quickly to changes in demand, adjust routes, and meet unique customer needs. This adaptability allows them to deliver tailored and customized services, which is very useful for organizations with specialized shipping requirements.

Wide Range of Service Offerings

Small trucking fleets frequently provide services beyond freight transportation. They may offer specialist services such as last-mile delivery, refrigerated transport, or other industry-specific services. These services meet the unique demands of organizations in a variety of industries, helping to improve the supply chain’s overall efficiency.

Job Creators

Small trucking operations support local economies by creating jobs. They frequently hire drivers, mechanics, dispatchers, and administrative personnel from the neighboring communities, thereby promoting job prospects and economic growth. They also help to grow auxiliary sectors like truck maintenance and repair, fuel providers, and truck equipment makers.

Challenges for Small Trucking Fleets

Small trucking fleets have unique challenges such as limited resources and access to capital. They are concerned with maintaining a profitable business within the constraints of their financial resources, making it more challenging to deal with the industry’s volatility caused by external factors such as higher fuel prices, freight rates, and supply chain disruptions. With limited resources, small trucking fleets may also find it challenging to keep track of everything involved in fleet equipment, employees, booked revenue, and utilizing the most profitable routes.

Implementing an automated system that centralizes fleet, trip, and financial data supported by communication channels that keep drivers and dispatchers in sync can be a valuable investment for a small trucking company. It can help facilitate more on-time deliveries, improve client satisfaction, and establish a competitive edge in the marketplace.

About Western Truck Insurance Services

Western Truck Insurance Services is an insurance brokerage specializing in commercial truck insurance. We know this stuff and want to make sure you do too. Our clients appreciate our dedication to finding competitive rates and offering unparalleled service beyond excellent insurance options. They also value how our state-of-the-art automation provides lightning-fast truck insurance quotes, customer service, insurance certificates, and coverage changes. Contact us today at (800) 937-8785 to learn more.

The Importance of On-Time Insurance Payments

Western Truck Insurance

Late insurance payments occur for a number of reasons, including accounting oversights or cashflow issues. However, it’s important to be aware of how late insurance payments can affect your trucking business.

Coverage Gaps

If insurance payments are not made on time, the trucking company’s policy may cancel and lead to a loss of coverage. For example, if a payment for the business’s Trucking Liability policy were missed, the policy canceled, and an accident occurred during the period of lapsed coverage, the firm would be responsible for bearing the full financial burden, including damages, medical expenses, and legal costs. This can be financially devastating for a business. The trucking company’s regulatory filings would also be cancelled, resulting in a suspension of DOT authority as well.

Additional Costs

Late insurance payments can result in additional charges, such as late fees, which can increase the overall cost of insurance coverage. These extra expenses can eat into the business’s profits and make it more challenging to maintain financial stability.

Underwriting Issues with Policy Cancellations and Reinstatements 

Insurance underwriters closely examine the payment history and financial stability of a business during the underwriting process. Policy cancellations/reinstatements due to late payments may raise red flags and prompt underwriters to scrutinize the business’s financial situation more thoroughly. This can lead to additional requirements, such as increased down payments or deductibles and/or additional documentation to demonstrate the business’s financial viability.  All of the above will affect the price of the insurance quoted, if quoted at all.

Legal Consequences

Operating a trucking business without insurance coverage is illegal in most jurisdictions. If a trucking company is caught operating without insurance due to late payments, it can face legal consequences, including fines, penalties, or even license suspension. This can seriously disrupt the business’s operations and tarnish its reputation.

Difficulty in Securing Contracts

Many customers, especially larger corporations, require proof of insurance coverage before entering into contracts or agreements with trucking companies. Late payments and lapses in coverage can create doubts about the reliability and financial stability of the trucking business, making it harder to secure contracts and potentially leading to a loss of business opportunities.

Impact on Credit Rating

Late insurance payments may negatively impact the trucking company’s credit rating. This can make it more difficult to secure favorable terms for loans, leases, or other financial agreements in the future, limiting the business’s ability to invest in new vehicles, equipment, or expansion.

It is crucial for a trucking business to prioritize timely insurance payments to ensure continuous coverage. These payments need to be top priority.

About Western Truck Insurance Services

Western Truck Insurance Services is an insurance brokerage specializing in commercial truck insurance. We know this stuff and want to make sure you do too. Our clients appreciate our dedication to finding competitive rates and offering unparalleled service beyond excellent insurance options. They also value how our state-of-the-art automation provides lightning-fast truck insurance quotes, customer service, insurance certificates, and coverage changes. Contact us today at (800) 937-8785 to learn more.

 

Lawmakers Looking to Get the Younger Generation Behind the Wheel

Western Truck Insurance

As part of a requirement under the bipartisan Infrastructure Investment and Jobs Act (IIJA), in 2022, the Federal Motor Carrier Safety Administration (FMCSA) established the Safe Driver Apprenticeship Pilot Program (SDAP). The goal of the three-year program is to help individuals ages 18, 19, and 20 explore interstate trucking careers and help trucking companies hire and train new drivers.

The program was started to help address the truck driver shortage in our country. The trucking industry is currently facing a shortage of more than 78,000 truck drivers coupled with a need to hire 1.2 million new drivers over the next decade to meet increasing freight demands, according to the American Trucking Associations (ATA).

Under the SDAP, a maximum of 3,000 drivers can participate in the program at any one time; however, there have been fewer than a dozen enrollees. The program’s failure is because of extra requirements by the U.S. Department of Transportation (DOT) that were not included in the original law.

Bill Introduced to Get Safe Driver Apprenticeship Pilot Program on Track

To help get SDAP back on track, Congressmen Rick Crawford (R-Arkansas) and Henry Cuellar (D-Texas) urged the DOT to take corrective actions that would improve participation in the SDAP and required DOT to provide Congress detailed reports on SDAP’s status and corrective actions taken to improve participation.

These changes directs the Secretary of Transportation to move forward with regulations to allow 18- to 20-year-old commercial motor vehicle (CMV) drivers to operate across state lines if the data does not demonstrate that those in the IIJA pilot program drive less safely than other CMV drivers.

“Building a 21st century supply chain requires a strong, vibrant, and growing trucking workforce,” said ATA President and CEO Chris Spear. This update will bolster new career pathways into interstate trucking while promoting safety and training standards that far exceed the bar set by states today. Congressmen Crawford and Cuellar’s efforts offer a timely and essential trucking workforce and supply chain solution, built off years of broad bipartisan Congressional support. By directing DOT to steer the Program back to the course Congress originally intended, and providing a path forward to a new trucking workforce to safely enter the industry, this bill will ensure that trucking has the talent it needs to meet the economy’s growing freight demands in the years to come.

About Western Truck Insurance Services

Western Truck Insurance Services is an insurance brokerage specializing in commercial truck insurance. We know this stuff and want to make sure you do too. Our clients appreciate our dedication to finding competitive rates and offering unparalleled service beyond excellent insurance options. They also value how our state-of-the-art automation provides lightning-fast truck insurance quotes, customer service, insurance certificates, and coverage changes. Contact us today at (800) 937-8785 to learn more.

 

DOT-Compliant Vehicle Inspections: Part I

Bob Holtzman

Over the next few articles, we will review vehicle inspection requirements for commercial trucks as required and endorsed by the U.S. Department of Transportation’s (DOT) Federal Motor Carrier Safety Administration (FMCSA). In this article, we will review daily vehicle inspections.

Drivers must conduct inspections at the beginning and end of each shift and on each vehicle used and complete a driver’s vehicle inspection report (DVIR). A DVIR is used to notify a driver’s company about any unsafe or missing equipment on the vehicle. It’s an integral part of a systematic and compliant vehicle maintenance program. Before anyone else can drive the vehicle, the company must repair the defect(s).

Who Is Required to Fill Out a DVIR?

The DVIR rules apply to drivers of commercial trucks (and buses) weighing 10,001 pounds or more.

DVIR Exemptions

Certain types of vehicle operators are exempt from DVIR inspection rules:

  • Driveaway-towaway operations, in which the vehicle or trailer being towed is the commodity being transported
  • Motor carriers with only a single commercial vehicle
  • Private motor carriers that transport passengers but not as a business operation

What Does the DVIR Include?

The DVIR should include the following information:

  • Date
  • Vehicle identity (fleet unit number, license plate number, etc.)
  • Signature of the driver who filled out the form
  • Signature of the mechanic or other person who repaired the vehicle (or decided that repair was not needed)
  • Signature of the next driver of the vehicle to acknowledge that the repair was done or not needed

Vehicle Parts to Include in the Inspection

Each DVIR must include any defects found on the following parts and accessories:

  • Service brakes (including trailer brake connections)
  • Parking (hand) brake
  • Steering system
  • Lights and reflectors
  • Tires, wheels, and rims
  • Horn(s)
  • Windshield wipers
  • Rearview mirrors
  • Coupling devices
  • Emergency equipment (fire extinguisher, reflective triangles, spare fuses)

If a driver or company violates the DVIR rules, the penalties for violations are significant: up to $1,270 per day for failing to complete a DVIR when required, up to $12,700 for falsifying a DVIR to hide a safety defect, and up to $15,420 for failing to repair a reported safety defect.

About Western Truck Insurance Services

Western Truck Insurance Services is an insurance brokerage specializing in commercial truck insurance. We know this stuff and want to make sure you do too. Our clients appreciate our dedication to finding competitive rates and offering unparalleled service beyond excellent insurance options. They also value how our state-of-the-art automation provides lightning-fast truck insurance quotes, customer service, insurance certificates, and coverage changes. Contact us today at (800) 937-8785 to learn more.

 

Under the Hood of Physical Damage Truck Insurance

Bob Holtzman

Your truck and trailer equipment are the lifeline of your business and represent a significant investment. If your truck is damaged in an accident or fire or vandalized or stolen, you’re off the road, and your business is temporarily sidelined. Physical Damage Truck insurance steps in to get your truck and equipment repaired or replaced, and you back behind the wheel.

Physical Damage Truck insurance insures vehicles against a variety of damages, such as collision, vandalism, fire, and theft.

Policy Options Available

You can choose to get coverage on a specified-perils basis or purchase a policy with collision and full comprehensive insurance. With specified-perils coverage, you’re protected against only those losses your policy specifically lists. While this option costs less than comprehensive-based coverage, the difference is not significant enough to risk having a claim denied because the peril is not listed in the policy. We almost always recommend going for comprehensive coverage, so you are not left with hefty repair bills or, even worse, the cost of a new truck.

You also have a choice of deductibles for both collision and comprehensive coverage. The deductibles you choose (typically set at $1,000) will depend on how much you want to pay out of pocket before coverage kicks in. The higher the deductible, the lower the premium, as you will bear more repair costs. We can discuss this with you in further detail.

Coverage Limits

Ensure you buy enough coverage to cover the value of your truck and equipment. When you purchase Physical Damage insurance, most heavy truck insurance companies require you to submit a “stated amount,” which is your best estimate of your vehicle’s current value. The stated amount should consider the age and condition of your vehicle, mileage, permanently attached equipment, special equipment you’ve added, vehicle upgrades, and engine or major component rebuilds.

Some insurance companies will provide coverage on an actual cash value (ACV) basis, calculated based on the average of your vehicle’s Blue Book, retail, resale, and trade-in values. Once those figures are input and averaged out, the vehicle’s ACV is determined.

The accuracy of stated amounts is critical because it affects how insurance companies process and pay claims. Following an accident, an insurer will pay the lesser of the stated amount and the actual cash value of the vehicle.

Towing Coverage

Towing, recovery, and storage costs for a semi-truck can be an expensive after-accident expense. Towing to a nearby garage that can repair trucks should be covered by your Physical Damage policy. Also, consider how much reimbursement for towing expenses is included in the policy. If your Physical Damage insurance does not provide enough coverage, you may have to pay a large sum out of pocket.

About Western Truck Insurance Services

Western Truck Insurance Services is an insurance brokerage specializing in commercial truck insurance. We know this stuff and want to make sure you do too. Our clients appreciate our dedication to finding competitive rates and offering unparalleled service beyond excellent insurance options. They also value how our state-of-the-art automation provides lightning-fast truck insurance quotes, customer service, insurance certificates, and coverage changes. Contact us today at (800) 937-8785 to learn more.

Revisiting AB 5 for Truckers

Bob Holtzman

In 2019, California passed legislation called AB 5, which reclassifies many independent contractors as employees, including truckers. Signed into law in 2019, the “gig worker bill,” as it has been dubbed, took effect in January 2020. However, the California Trucking Association (CTA) got an injunction and stopped the state from reclassifying truck owner-operators as motor carrier employees under that law – until now.

AB 5 uses a three-part “ABC test” to figure out if a worker is an independent contractor, all of which must be true:

  • The worker is free from the control and direction of the employer (hiring entity) when performing work.
  • The work is outside the typical scope of the employer’s business.
  • The worker is customarily engaged in an independent trade, occupation, or business.

This “ABC test” is pretty tough to pass, especially the part about the “work being outside the scope of the employer’s business.” In many other states, independent contractor status is denied only if the worker typically performs work at the employer’s premises. The test in California raises the bar for independent contractor status.

So, what’s happened to put AB 5 back in the spotlight for the trucking industry?

The Supreme Court refused to hear the CTA case, and the injunction was lifted on June 30, 2022. Without the injunction, truck owner-operators can now fall under the gig worker bill’s criteria.

What’s Next?

There are about 70,000 owner-operators in the state. And, according to the CTA, more than 70% of them serve some of the country’s busiest ports, including Los Angeles, Long Beach, and Oakland. In most cases, AB 5 will govern the owner-operators’ relationships with carriers, brokers, and shippers.

Motor carriers will, in many instances, have to reclassify independent contractors as employees, which costs them more in payroll tax, employee benefits, and insurance. For example, AB 5 extends Workers’ Compensation rights to workers who had previously been classified as independent contractors and could not file claims for work-related injuries against their hiring employers. As employees, they are entitled to Workers’ Comp benefits. Be sure you speak with your insurance broker to fully understand how AB 5 impacts your insurance program.

Also, because AB 5 applies only in California, carriers that operate in and outside the state will need to figure out how to separate their operations for the time being to comply with the state’s regulations. (Note: Similar legislation is being considered in other states, so this may change.)

Additionally, independent contractors who work under contract with a trucking company and for themselves will lose flexibility under the new regulations.

Other legal issues with AB 5 also need to be unpacked, as the law is now in effect.

Some expect lawsuits to begin, and, depending on the political landscape, the outcomes may differ. One thing is for sure: to determine how the law may or may not apply to them, carriers will need a thorough understanding of their business relationships with their drivers. Those working with independent contractors must take action to keep their operations running smoothly.

About Western Truck Insurance Services

Western Truck Insurance Services is an insurance brokerage specializing in commercial truck insurance. We know this stuff and want to make sure you do too. Our clients appreciate our dedication to finding competitive rates and offering unparalleled service beyond excellent insurance options. They also value how our state-of-the-art automation provides lightning-fast truck insurance quotes, customer service, insurance certificates, and coverage changes. Contact us today at (800) 937-8785 to learn more.

Motor Truck Cargo Insurance Coverage

Bob Holtzman

Does your trucking operation utilize a specific location where you bring in freight for ether warehousing, transloading, or just temporary storage in transit? Have you discussed this part of your operations with your insurance broker?

Motor Truck Cargo Insurance

What you may not know is that your motor truck cargo insurance policy likely will NOT provide coverage while freight is on those premises unless that insurance policy has been properly set up for it.

OUCH.

These are the types of surprises a business owner can do without; especially when finding out about it AFTER an event has occurred.

What? You say…

READ your insurance policy…

Is your premise location listed on that motor truck cargo policy? Do you leave loaded trailers detached from power units? What are the actual limits of exposure you really have at risk in your terminal, and has your cargo policy been written to include that terminal exposure?

If you don’t know or aren’t sure, make sure you check with your insurance broker and READ your policy.

Many cargo policies will not even offer terminal coverage. Most have exclusions for detached trailers, unattended vehicles, and freight off of trucks. For those policies that will allow for storage in transit in a specified location (your warehouse), the usual time period is only 72 hours. Is that limitation going to work for you?

About Western Truck Insurance Services

Western Truck Insurance Services is an insurance brokerage specializing in commercial truck insurance. We know this stuff and want to make sure you do too. Our clients appreciate our dedication to finding competitive rates and offering unparalleled service beyond excellent insurance options. And they value how our state-of-the-art automation provides lightning-fast truck insurance quotes, customer service, insurance certificates, and coverage changes. Contact us today at (800) 937-8785 to learn more.

Insurance for LTL vs TL Operations: Part 1

Bob Holtzman

Freight Capacity and Truckload vs. LTL

Freight capacity is the term shippers use to describe the amount of space secured on trucks and other vehicles to carry their loads. Also known as trucking capacity, it is a critical aspect of managing supply chain deliveries.

In the trucking industry, a shipping service that takes the entire tractor-trailer truck’s capacity with no space to add extra goods is known as a truckload or TL for a full truckload. When shippers only utilize part of a truck’s capacity, which leaves space for additional goods, they use LTL to describe Less than TruckLoad shipments.

LTL freight delivery uses various truck types to ship goods to multiple locations. For example, a box truck with a gross weight below the requirement for a commercial driver’s license is a typical vehicle used by LTL carriers. Although box trucks for parcel deliveries from Amazon shipments, where drivers can make some 40 different deliveries, are a specific example, large tractor-trailers do also make LTL deliveries.

Insurance for LTL operations

Underwriters review LTL insurance operations closely for several reasons. These include delivery time constraints and the extra stress that making many stops puts on drivers who face more unusual situations than long-distance, over-the-road drivers. Additionally, underwriters are concerned because many LTL drivers don’t have and aren’t required to have a commercial driver’s license.

Apprehensions about safety are a significant reason underwriters review LTL operations because they know the LTL industry has fewer regulations and oversight. Insurance companies inspect how freight companies manage their drivers and ensure they comply with federal laws. Should a company fail to meet requirements, underwriting may decline coverage.

 Insurance for Full Truckload (TL)

The term “full truckload” (TL) refers to a shipment requiring full use of cargo space in the truck. TL insurance protects a motor carrier’s operations and pays claims for lost or damaged shipments and applicable legal defense expenses.

A TL carrier’s policy traditionally covers the motor carrier for its’ auto, general, and cargo liability. It also may provide physical damage coverage for the equipment.  

TL carrier policies are more simple to underwrite than LTL carriers. A review of IFTA state mileage reports, DOT inspections, driving records, and loss reports are generally what is used to determine acceptability and rates. 

There are more insurance carriers willing to provide coverage for TL vs. LTL operations.

About Western Truck Insurance Services

Western Truck Insurance Services is a well-respected and professionally managed truck and transportation insurance brokerage. Our clients appreciate our dedication to finding competitive rates and offering unparalleled service beyond excellent insurance options. Our clients appreciate our state-of-the-art automation that provides them lightning-fast truck insurance quotes, customer service, Insurance certificates, and coverage changes. Contact us today at (800) 937-8785 to learn more!