The commercial trucking industry is beginning to experience severe difficulties relating to their liability insurance. According to a recent Waste 360 report, trucking firms are seeing their commercial liability premiums spike from between 10% and 30% this year. Much of this rise is attributed to the number of accident claims, but also due to less competition for the business in the market. Two large insurance providers, Zurich Insurance and American International Group have recently left the industry.
The current minimum liability insurance coverage amount for the trucking industry is $750,000, and higher for those transporting hazardous material. The Federal Motor Carrier Safety Administration (FMCSA) is an industry regulator who is an advocate for higher coverage minimums, and also is adding additional requirements to carriers who transport food.
Brian Fielkow, CEO of Jetco Delivery reported to Fleet Owner that it isn't simply the multi-million dollar jury verdicts that are driving up insurance rates. He says that the more common $25,000 to $50,000 settlements are adding up and adversely affecting them because they aren't worth fighting in court. Fielkow is installing on-board cameras in the trucks within his fleet, capable of recording a crash and potentially providing evidence that would result in fewer liability settlements. This also allows staff to monitor driver safety for quality control.
Major Verdicts Hurt Industry
Significant verdicts and settlements are certainly a factor in the rising prices. Recently a jury in Kansas awarded $23.5 million in a lawsuit resulting from a tractor trailer accident in New Mexico. This award is believed to be the largest among accident verdicts in Kansas to date. The driver, Robyn Getchel had a positive drug test indicating she was under the influence of methamphetamine while working for Swift Transportation at the time of the accident. The accident apparently occurred on a ramp from a rest stop when Getchel's truck hit another large truck. The collision killed driver Dennis Bottorff and another victim suffered a major spinal cord injury.
Effects on Prices of Goods
As those who transport our goods continue to see rising costs in their fixed insurance costs, they are likely to begin passing that cost along. This can result in overall increases in the products we purchase, the majority of which are transported by truck at some point. Before we begin being too sympathetic to the industry, we should keep in mind that fuel, one of their largest expenditures, has been consistently low over the last few years.
Have you or a loved one been badly injured in an accident involving a commercial truck? The Law Firm of Jeremy Rosenthal has been successfully assisting victims of injury from accidents with these large trucks to obtain the financial compensation they deserve. Contact the office immediately for a consultation.