Tag Archives: minimum liability insurance

Has FMCSA Done Due Diligence To Appropriately Address Trucking Minimum Liability Insurance Question?

After a truck crash killed our daughters, AnnaLeah (17) and Mary (13) on May 4, 2013, we discovered that there were many problems with truck safety, including inadequate trucking liability insurance. In 1980, Congress set the level of liability insurance for trucking companies at a MINIMUM of $750,000. If that were adjusted for inflation, it would be $2,225,643 in 2017. Yet, DOT has not once raised that level in 37 years — thereby jeopardizing the safety of the traveling public.

In fact, on June 5, 2017, the FMCSA withdrew the Advanced Notice of Proposed Rulemaking (ANPRM) on the Appropriateness of the Current Financial Responsibility and Security Requirements for Motor Carriers, Brokers, and Freight Forwarders, which was intended to raise that minimum. The history of that rulemaking is summarized below.

Prior to that ANPRM, the FMCSA issued a Report in April 2014 , as required (actually one year late). They are required by Congress to issue reports every four years, which means another report should have been completed by April 4, 2017 (or thereabouts). “Section 32104 of MAP-21. . . directed the Secretary [of Transportation] to determine the appropriateness of these requirements every 4 years beginning April 4, 2013.”

The Motor Carrier Act of 1980 initially established the minimum level of financial responsibility for motor carriers:

The legislative history of the MCA shows that Congress included section 30 because “the issue of financial responsibility…is inextricably bound to the entry provisions of the legislation that directly concern the ‘fitness’ of the carrier to operate in interstate commerce.”11 Further, the legislative history of the MCA indicates that the purpose of section 30 was “to create additional incentives to carriers to maintain and operate their trucks in a safe manner as well as to assure that carriers maintain an appropriate level of financial responsibility.”12

The legislative history of section 30 indicates that setting minimum levels of financial responsibility would address two concerns. First, the minimum levels would “assure that public safety is not jeopardized” in connection with the increased entry to the industry due to deregulation.13 Second, the minimum levels would ease concerns that the largely deregulated industry would put pressure on safe operators to cut costs to meet the prices of their competitors, “some of which may cut costs by operating in violation of minimum safety standards.”14

https://www.fmcsa.dot.gov/sites/fmcsa.dot.gov/files/docs/Financial-Responsibility-Requirements-Report-Enclosure-FINAL-April%202014.pdf

Clearly, Congress intended for the insurance industry to be the gatekeeper of the motor carrier industry to ensure the safety of the American public.

MAP-21 continued the process to ensure that appropriate increases would be put in place. A summary of the April 2014 FMCSA Report, from the Executive Summary on page 1, sheds light on the matter:

On July 6, 2012, President Obama signed into law the Moving Ahead for Progress in the 21st Century Act (MAP-21; P.L. 112-141). Section 32104 of MAP-21 directed the Secretary of the U.S. Department of Transportation (DOT) to issue a report to the Committee on Commerce, Science, and Transportation of the Senate and the Committee on Transportation and Infrastructure of the House of Representatives on the appropriateness of the current minimum financial responsibility requirements for motor carriers of property and passengers, and the current bond and insurance requirements for freight forwarders and brokers.

Section 32104 also directed the Secretary to issue a report on the appropriateness of these requirements every 4 years starting April 1, 2013. The Secretary delegated the responsibility for this report to the Federal Motor Carrier Safety Administration (FMCSA).

Interstate motor carriers and transportation intermediaries, as well as certain intrastate hazardous materials carriers, are required by law to maintain minimum levels of financial responsibility. 2 This report explains the history of these requirements, examines the current minimum insurance levels for the different sectors, provides background on the motor carrier industry, and summarizes the findings of a recent FMCSA-sponsored study on the adequacy of the Agency’s current required minimum levels of financial responsibility, as well as findings from other reports on minimums. The report does not examine the current bond and insurance requirements for freight forwarders and brokers since MAP-21 mandated these requirements to be $75,000 effective October 1, 2013, and the Agency will report on the appropriateness of these levels after it has had the opportunity to observe their impacts.

The legislative history of minimum insurance requirements for commercial motor vehicles (CMV) indicates that Congress recognized that crash costs would change over time and that DOT would periodically examine the levels and make adjustments as necessary. A variety of recent studies indicate that inflation has greatly increased medical claims costs and related expenses. In conclusion, FMCSA has determined that the current financial responsibility minimums are due for re-evaluation. The Agency has formed a rulemaking team to further evaluate the appropriate level of financial responsibility for the motor carrier industry and has placed this rulemaking among the Agency’s high priority rules. The FMCSA will continue to meet with the stakeholders, including impacted industries, safety advocacy groups, and private citizens, as it moves forward with developing a proposed rule.

https://www.fmcsa.dot.gov/sites/fmcsa.dot.gov/files/docs/Financial-Responsibility-Requirements-Report-Enclosure-FINAL-April%202014.pdf

Although the Secretary delegated the responsibility for this report to the FMCSA, Senator Richard Burr (R-NC) stated to us in person on August 12, 2013 – three months after our tragic truck crash – that the Secretary of Transportation has the authority to act administratively to increase the minimum financial responsibility levels.

In fact, FMCSA, subsequent to publishing their initial report in April 2014, issued an ANPRM on November 28, 2014, to continue study of this issue. Following that, FMCSA took these actions:

  1. The Agency formed a rulemaking team to evaluate the appropriate level of financial responsibility for the motor carrier industry and placed this rulemaking amontgthe Agency’s high priority rules.

  2. This study was discussed at the FMCSA Motor Carrier Safety Advisory Committee (MCSAC).

  3. FMCSA asked for Public Comments.

  4. FMCSA reportedly did not receive the substantive information — through the Public Comment process – which they have stated is necessary for them to do the required cost benefit analysis (according to their interpretation of EO 12866) in order to move the rulemaking process forward (for signature by the Secretary and approval by the OMB/OIRA).

  5. FMCSA asked for voluntary compliance from the insurance industry. However, there has been no information provided from the insurance industry to verify the claim that the insurance premiums for trucking companies would skyrocket to $20,000/year when the minimum liability levels are raised (as reported to independent owner-operators by the OOIDA, who is in fact an insurer for many OOIDA members http://www.landlinemag.com/Story.aspx?StoryId=29050 ) and that “the only winners would be trial attorneys and large motor carriers.” This allegation has never been substantiated.

  6. The next step by FMCSA, according to an email which we received on June 11, 2015, from an administrator in the FMCSA, was to try another tactic to get the information from the insurance industry:

    FMCSA does not have information to estimate the increase in insurance premiums if the Agency increased the current $750,000 limit (for property carriers transporting general freight) to $4.2 million. As part of the rulemaking process, the Agency would need to gather this thpe of information to determine the costs of requiring carriers to increase their coverage. We just published a rulemaking on “Confidential Business Information” to help encourage insurance companies to share some of their proprietary information with the Agency for our use in the rulemaking process, without disclosing to the general public the confidential information. Hopefully, the new rules on confidential information will help us get the data we need.        

  1. The final step was taken by the FMCSA to formally withdraw the ANPRM on June 5, 2017.

It should be noted that, if the Secretary of Transportation merely raised the minimum level to adjust for inflation, the $750,000 set in 1980, using the latest U.S. Government CPI data (http://www.usinflationcalculator.com/), would be equivalent to $2,225,643.20 in 2017. Additionally, the Value of Statistical Life set by the Department of Transportation is currently listed as $9.6 million as of August 8, 2016.

https://www.transportation.gov/sites/dot.gov/files/docs/2016%20Revised%20Value%20of%20a%20Statistical%20Life%20Guidance.pdf

It must therefore be asked, Has the FMCSA done due diligence to obtain the required information to do the study mandated by Congress? In fact, could they have gone a step further, as we have been told by a former DOT administrator, and issued a subpoena to the insurance industry to obtain this information? Could FMCSA even have requested Congress to hold a formal hearing – as we have requested numerous times — to obtain information from the insurance industry?

Where do we go from here? What are the options at this point for resolving this issue? Given that it has been over 30 years since the current level was set, and that the FMCSA has had adequate time to act and report on this supposedly priority rulemaking, it now seems prudent to:

  1. Call upon Elaine Chao, as the Secretary of Transportation, to do what no other Secretary since 1980 has done and act upon her authority to set a new minimum level of financial responsibility for the motor carrier industry and immediately raise it from $750,000 to $2,225,000.

  2. Following that decisive action, FMCSA should then:

  • Ask Congress to hold a public hearing to obtain the necessary information from the insurance industry;  OR

  • Subpoena the insurance industry to provide the required information.

  • Then immediately proceed with NPRM rulemaking – setting it as a top priority to determine future actions which should be taken to raise the minimum levels according to other calculations besides adjustment for inflation, both now and in the future as mandated by Congress.

If we do nothing to address this problem, then we will continue to expose the traveling public to greater risk of truck crash tragedies. Who should we hold responsible for the resulting deaths? And who will bear the economic burden of this negligence?

Jerry and Marianne Karth

June 4, 2017

Sign a Petition Asking for Immediate Action: Protect Vulnerable Travelers: Demand Immediate Increase in Trucking Liability Insurance

Demand for Due Diligence Action by FMCSA.pdf

Further Information on this issue: FMCSA will withdraw rule to raise truck min. liability ins. Who is responsible & who will pay the price?

FMCSA will withdraw rule to raise truck min. liability ins. Who is responsible & who will pay the price?

Please pray for us to have wisdom on how to respond to the upcoming action (on Monday, June 5, 2017) by the DOT/FMCSA to WITHDRAW RULEMAKING on trucking minimum liability insurance  — which has not been raised in over 30 years.

This issue is one of the three #trucksafety issues which we included in our 2014 AnnaLeah & Mary Stand Up For Truck Safety Petition. FMCSA responded with rulemaking in November 2014. The 11,000+ petition signatures were added to the Public Comments for this Proposed Rule.

The AnnaLeah & Mary Stand Up For Truck Safety Petition: http://www.thepetitionsite.com/957/501/869/stand-up-for-truck-safety/

The signtures were posted on the Federal Register hereThe is a Comment on the Federal Motor Carrier Safety Administration (FMCSA) Proposed Rule: Financial Responsibility for Motor Carriers, Freight Forwarders and Brokers: AnnaLeah and Mary Karth – Comments

Articles on this upcoming action:

  1. FMCSA Yanks Minimum Insurance Rulemaking, Heavy Duty Trucking, Truckinginfo.com, David Cullen, June 2, 2017
  2. FMCSA officially nixes rule on increasing minimum liability insurance required for carriers, Overdrive|June 02, 2017
  3. FMCSA Drops Plans to Study Raising Insurance Minimums for Motor Carriers, Brokers  This article even mentions that our 11,366 petition signatures were included in the Public Comments considered by FMCSA .
Who bears responsibility for this decades-long delay?
  1. The trucking industry for acting to delay progress on this important issue.
  2. FMCSA for not using their authority to subpoena the insurance industry to provide the necessary information for the required cost/benefit analysis.
  3. The insurance industry for not providing the requested information.
  4. The Secretary of Transportation for not using his/her authority to sign in an increase — as was originally intended.
  5. Congress for not acting to make sure that this issue is properly addressed.
  6. The President for not signing a Vision Zero Executive Order to ensure that safety rules are not delayed or diluted by cost/benefit analysis that does not give appropriate value to the preservation of human life and health.

See the April 2014 FMCSA Report on this issue: https://www.fmcsa.dot.gov/sites/fmcsa.dot.gov/files/docs/Financial-Responsibility-Requirements-Report-Enclosure-FINAL-April%202014.pdf

Read more about this issue here:

Fortunately we plan on submitting a public comment to the upcoming FMCSA Motor Carrier Safety Advisory Committee public meeting on June 12 in D.C.

Despite our requests for Congress to hold a hearing to force the insurance industry to provide the necessary financial information, no one has been willing to do this. As Jerry says, it is a very one-sided situation: The FMCSA is apparently accepting the information that the rates will sky-rocket and trucking companies will go out of business  — although no one has been able to offer proof of this. At the same time, the FMCSA is apparently not accepting the proof that the current liability level is not adequate to cover the costs to society of these truck crashes.

Furthermore, this issue not only impacts the compensation for truck crash tragedies to the victims and the cost to society, but it also limits the ability of the market to ensure that trucking companies are held accountable for their safety practices.

 What will break through this roadblock?

With Road to Zero, DOT commits $3 million; compare that to $9.6 million Value of a Statistical Life

I should be jumping up and down for joy about the recent launch of the Road to Zero Coalition by the US DOT and the National Safety Council. So it doesn’t feel great to be one of those voices who are saying negative things about this great project.

I do look forward to watching how they coordinate the efforts of many organizations around this country who work to save lives. But I have some concerns about the process:

  1. Will they make any significant change in the strategies used to address the disturbing public health problem of 35,200+ Deaths by Vehicle Violence each year?
  2. Will they harness the energy and motivation of survivors/families of victims of vehicle violence?
  3. Will they mobilize citizens to be a significant part of the solution?
  4. Will they have a powerful voice to speak on behalf of the vulnerable victims who cannot speak for themselves?
  5. Will they take steps to address the imbalance of priority in rulemaking of profit over people?

Let’s just consider the last question. One thing which I have learned, after my life was catastrophically up-ended by my two youngest daughters’ deaths from a truck underride crash, is that there appears to be a hesitancy (to put it mildly) to put a meaningful monetary value on the cost of saving human lives.

To begin with, there is the difficulty of getting safety measures to pass the stringent test of the cost/benefit analysis required in federal rulemaking which, in my mind, inordinately favors the cost to industry vs benefit of preventing deaths and serious injuries. This is also reflected in the opposition to increasing the minimum liability insurance for truckers which was set at $750,000 in 1980 and has not been raised since then — despite the current Value of a Statistical Life (VSL) set by DOT at $9.6 million for 2016.

Value of a Statistical Life-guidance-2016

If you have read much of what I write, you might realize that I am in favor of reshaping the rulemaking process to ensure that it properly values human life. But aside from that, let’s just use that $9.6 million and do a little math.

The US DOT announced with the launch of the Road to Zero Coalition that it was committing $1 million/year for three years for grants to non-profit organizations that propose initiatives to save lives. Sounds great, right? But then I took out pen and paper (to get the hands-on sense of the calculation) and worked out the Value of the Statistical Lives of the 35,200 people who died on our roads in 2015 — keeping in mind that it was probably undercounted and does not include the cost of serious injuries.

$9.6 million X 35,200 = $337, 920,000,000 or almost $338 billion in one year alone

Then I decided to take it one step further and calculate the cost of the traffic fatalities over the next 30 years of the Road to Zero strategy to save lives — without taking into account the probable increase in the VSL.

$337,920,000,000  X 30 = $10,137,600,000,000 or over $10 trillion (which includes the cost to society)

And how much is DOT dedicating to this project to try and put a dent on the estimated 1,056,000 Deaths by Vehicle Violence? $3 million (of taxpayer money) — not even 1/3  the supposed value of a person’s life. Why, my two daughters alone were supposedly worth $18.2 million combined in 2013. Two immeasurably precious ones gone far too soon.

$3,000,000 vs $10,137,600,000,000

Now I had trouble even typing those numbers in accurately, so it is entirely possible that I made a mathematical error (didn’t use a calculator). So, please, do the math yourself. And then let me know if you think that we, as a country, are making a truly meaningful effort to do something new to stem the tide of bloodshed.

IMG_4464

 

CBA Victim Cost Benefit Analysis Victim

Car Safety WarsPetition

Insightful Commentary on the State of Trucking Minimum Liability Insurance by a victim’s family member

Minimum Insurance infographic

What do you think about the tug of war over trucking minimum liability insurance? Should it or should it not be raised after 35 years? Before you decide, read this commentary by a family member of a truck crash victim (Michelle Novak):

Michelle Novak 🙁https://www.facebook.com/groups/494507530713925/permalink/548460131985331/)

“Not one single penny increase. It’s “purchasing power” is almost zero, and this is money that has to be disbursed among survivors of wrecks, whether one or thirty—they split the $750,000… After lawyer fees, first in line are the—get this—insurance company lawyers! They get free taken out of this survival money for victims, for emergency room lifesaving, surgeries, helicopter flights, ambulances, ICU, etc…even though those same lawyers are paid by the insurance company. They don’t shop around to find a lawyer who will handle passing out the money. These are lawyers who are part of these gigantic insurance behemoth. And after all the first responders line up for their cut to cover….responding to a truck crash, repairing roads and guardrail, hazmat responses, putting out fires, using the jaws of life to extract victims, police presence, etc…,

“Now. Imagine 15 victims, fine fatalities and ten injuries, nine damaged vehicles, on top of all this. Victims were airlifted, all were treated, and one needed heroic efforts and now a lifetime of care, has become disabled. ..there is so much in one complex wreck, it works be almost impossible to calculate cost. Doesn’t matter. Can’t sue the insurance company for knowingly covering a driver with a ten-year history of lawbreaking with his truck, leading to this crash. Can’t sue the govt agencies that simply didn’t bother dreaming with him and enforcing the laws it is tasked with enforcing. And the company is a one-truck operation that files for bankruptcy the day after the crash.

“$750,000 ….minus all those players. That is, of course actually nothing, which is why victims end up with medical liens placed on everything they own or ever might own, and are in debt the rest of their lives, on top of the injury, the death of their loved ones.

“Now Imagine your killed loved one wasn’t actually moving when the wreck happened. He wasn’t even allowed to move. An accident up ahead. Traffic stopped. Ever other citizen duly stopped, as required by law.except the sound asleep truck driver with the forged medical certificate, the black-market purchased commercial license, the falsified log books, the fact that though he was exhausted, he drove right by the last truck rest s stop only a mile or so before he plowed right into that liner of stopped cars, ripping apart five human beings as he went.

“$750,000 in an industry that capitalizes on carrying insurance from over thirty years ago, with insurers who are shielded from civil suit, which means they don’t have any responsibility for knowingly, or not even bothering to find out, if the drivers they profit off of are horrible risks or not. And why should they? The most they could possibly lose,no matter how many laws the driver broke, no matter how habitual a lawbreakers the driver is, and no matter how many lives he destroys, is $750,000…

“How fantastic to be in a risk-based industry, covering bets on risk, and not even needing the actual insurance model to guarantee profit. How great to be able to figure your maximum costs based on the number of drivers insured, knowing that you’ll never be dragged into court, never be called to answer for insuring lousy drivers along with good…..how profitable to be able to charge those drivers more based on risk, without ever having to pass that magic, chiseled-into-stone level of $750,000…that is a custom-made giant profit machine, if ever there was one.

“If anyone else happens to read this…..if you haven’t had to experience this reality yet personally, please do your best to picture it. It can be your reality in the blink of an eye: your never-ending injustice that you get to live every day, knowing that these insurance execs, CEO s, shareholders, all walk away oblivious to what this setup, that they don’t mind spending good lobbying money on, does to not only its victims, but the entire society of taxpayers who must pick up the costs for every one of the parties listed earlier, because the cost has to be paid.

“There are ways to raise this to appropriate levels, while still spreading out cost among drivers and those very rich insurance companies, and the very rich gigantic retail, warehousing and shipping firms that make constant use of their trucks.

“We’ll get a plan hammered out, at some point. And then we’ll push it until the entire industry shares the costs of risk. When they finally all share it, you’ll be amazed at how quickly they straighten all this out…and these nightmares will stop.

“They don’t do anything out of kindness, citizenship duties, or any altruism. You have to make it hurt their only source of feeling: the gigantic pile of wealth they amass at the expense of their victims.”

Chuck Novak’s crash: http://www.truckaccidentlaw.org/blog/3363/driver-faces-multiple-charges-in-deadly-north-carolina-truck-accident/ &  http://www.blueridgenow.com/article/20101027/articles/101029886

Read more posts on this topic:  http://annaleahmary.com/tag/minimum-liability-insurance/

Owner-Operator Independent Drivers Association brochure of services

This OOIDA brochure describes their benefits and services. I picked it up at a truck stop while on a road trip. Note the truck driver insurance & minimum liability.

OOIDA brochure

“‘Ridiculous and tragic:’ Why insurance is unlikely to cover Simeon’s crash victims”

‘Ridiculous and tragic:’ Why insurance is unlikely to cover Simeon’s crash victims

“ITHACA, N.Y. — In 1980, the U.S. Congress passed a bill forcing all trucking companies operating across state lines to have insurance that covered at least $750,000 in damages in the event of a crash.

That number hasn’t been raised in the 35 years since.

‘It’s so pathetically low,’ says John Lannen, executive director of the Truck Safety Coalition. ‘That $750,000 is not going to be anywhere close to covering the cost of a catastrophic crash.’

The company that owned the truck that hit Simeon’s in downtown Ithaca on June 20, 2014, had a policy of $1 million, which is considered by experts to be slightly higher than the $750,000 minimum. That information was confirmed in legal papers released earlier this month, in which the Sparta Insurance Firm asked the court to divide the $1 million between possible victims.”

Read more here: http://ithacavoice.com/2015/07/ridiculous-and-tragic-why-insurance-is-unlikely-to-cover-simeons-crash-victims/

Ralph Nader: “Enough! Stop More Giant Truck-Trailers on Your Highways”

Ralph Nader speaks up about the battle for truck safety, calling for citizens to speak up for safer highways–a matter of life & death.

Read more here & see how you can help:  https://blog.nader.org/2015/07/02/enough-stop-more-giant-truck-trailers-on-your-highways/

Rebekah photo of crash

 

Contact Information for U.S. Senators:  http://www.senate.gov/general/contact_information/senators_cfm.cfm?OrderBy=state

Contact Information for U.S. House of Representatives:  http://www.house.gov/representatives/

See previous posts for Congress contact information:

Please use the icons below to SHARE this call for action.

 

Tug of War over truck/highway safety: Something’s wrong with this picture!

Two years ago a truck crash killed our two youngest daughters, AnnaLeah (17) and Mary (13).

One year ago, we garnered over 11,000 signatures on a petition asked Secretary Foxx to advance 3 measures to improve factors related to safety on our roads.

We have seen step-by-step progress toward our goals but get concerned when we see signs that a tug of war continues over this life & death battle.

“Two Different THUD Bills Set Up Congressional Showdown on Trucking Issues” http://www.landlinemag.com/Story.aspx?StoryId=29323#.VZUr1_lViko

  • In our AnnaLeah & Mary Stand Up For Truck Safety Petition, we asked for Electronic Logging Devices to be required as soon as possible due to our concern about the impact of Driving While Fatigued (DWF) on truck drivers’ ability to respond in emergency situations (e.g., in work zones or when traffic is backed up due to a crash ahead–as in our case) http://www.bloomberg.com/news/articles/2014-10-01/mom-takes-on-truckers-after-highway-wreck-kills-daughters
  • Yet, there is still opposition to this method of keeping track of the hours that drivers are behind the wheel (paper log books are a joke, not considered reliable, & never shown to us after our crash).
  • From that report on the THUD Bills: “The House version also chose not to expedite mandates for electronic logging devices or speed limiters, which – like the insurance issue – are items opposed by OOIDA and small-business truckers but supported by large carriers and the American Trucking Associations.” – See more at: http://www.landlinemag.com/Story.aspx?StoryId=29323#.VZUr1_lViko
  • You’ve got to be kidding!
  • In our petition, we also asked for increases in minimum liability insurance for truckers–currently at $750,000 for over 35 years.
  • This, too, is being opposed. Read what that article said, “The House of Representatives has already passed its version of HR2577 for Transportation, Housing and Urban Development (THUD). That occurred on June 9. OOIDA and small-business truckers won a victory in that version because it contained language to prohibit the Federal Motor Carrier Safety Administration from pursuing an increase to insurance requirements for motor carriers.” – See more at: http://www.landlinemag.com/Story.aspx?StoryId=29323#.VZUr1_lViko
  • At least there is some hope for moving the insurance issue forward, “Specific to the insurance issue, the Senate version says FMCSA may continue pursuing an increase to insurance requirements, but only if the Department of Transportation secretary reports to the Appropriations Committee about the effects of raising the financial responsibility. The report would have to include an assessment of crashes that exceed the damage limits and assess the effects of higher insurance premiums on large and small motor carriers.”While hardly a glowing endorsement for increasing insurance requirements, the Senate version of HR2577 does not prohibit an increase as the House version does.” – See more at: http://www.landlinemag.com/Story.aspx?StoryId=29323#.VZUr1_lViko
  • See what I found out on estimated liability insurance rates if the minimum is raised: http://annaleahmary.com/2015/06/uncovering-new-information-on-trucking-minimum-liability-insurance-rates/

And while I’m at it, here are some other things going on with truck safety:

  1. “Tractor-trailer hitches could be faulty, 6,000 may be in use”  http://bigstory.ap.org/article/b9a33284cb604dc79f7e7d8ecd3c18ef/tractor-trailer-hitches-could-be-faulty-6000-may-be-use
  2. “Senator Goes After Reform of FMCSA” http://www.landlinemag.com/Story.aspx?StoryID=29305#.VZUqSPlViko     Comment by Steve Bixler
    “I applaud Sen. Fischer for her work on this bill. I have been saying for years, and hopefully it can be added to this or another bill soon, that what we need is a panel of veteran truck drivers, not company executives or industry stakeholders, but the actual guy who has his butt in the seat everyday, to oversee and review all existing FMCSA Regs, and also to be a part of all new regulation writing, so we can finally get rules and regs that are actually about safety and not money.”

Something’s wrong with this picture! When will it end?

Let’s make sure that it is not just about $.

And let’s not just point our finger at someone else to take the blame. Let’s figure out what we can do to end this senseless, tragic heartache happening on our roads. Let’s work together.

We Rescue Jesus Saves 018

Safety Is Not A Priority

Uncovering new information on Trucking Minimum Liability Insurance Rates

After numerous phone calls and emails, I have finally been able to find someone who could give me a rough estimate of the premiums which a trucking company might be able to expect if the minimum liability gets increased from $750,000 to $4.2 million. In fact, two people–unbeknownst to each other–referred me to this man, who is the president of an independent insurance agency.

I spoke with him yesterday and explained to him the kind of information that I was looking for and why I was doing so.  I let him know that I have been trying to verify whether there was any truth to the “early estimates” which I have been reading about and that it was important to me to know whether what truckers and Congress were being told was accurate. Specifically, is it accurate that a current premium of $5,000/year could skyrocket to $20,000/year?

He then described to me the graduated system of premium rates–which I had previously heard of through John Lannen: http://annaleahmary.com/2015/06/the-future-of-trucking-who-pays-for-the-costs-of-safer-roads/ John Lannen, executive director of the Truck Safety Coalition, has shared background information with us which he has gathered from numerous sources, presentations, and conversations regarding the economics of additional insurance coverage for motor carriers.  It turns out that the first million dollars’ worth of  trucking insurance is the most expensive and each incremental amount is cheaper. . . . ” (For more details, go here: http://annaleahmary.com/2015/06/trucking-minimum-liability-insurance-trucker-wages-a-facebook-conversation/ )”

After speaking with him, I immediately proceeded to email him and document what I had heard him tell me over the phone. I asked him to verify the accuracy of my description. Here is my email to him and his response to me:

Thank you again for taking the time to speak with me and answer my questions about trucking liability.
Please let me know if this is an accurate representation of your rough estimate of the impact of an increase in liability coverage upon trucking premiums:
1st million: $5,000/truck
2nd million: add $1,200
3rd million: add $900
each additional million: would continue to be a smaller increase
So, in this example, a trucker who currently pays $5,000 (and again, I am confused if this means that this $5,000 is for just his liability portion or his whole insurance bill) would pay something a little more than $7,100–like maybe $7,600.
To clarify: That estimate of a trucker’s premium would be for if the liability coverage was $4.2 million.
Would this be an accurate ROUGH estimate?
Marianne
His reply to me:

Marianne:   Thanks for your call and again my sincere regrets for your loss.   Yes, this is a very rough and best guess estimate based on what I see and hear. 

Best wishes in your pursuit. 

I also heard back from a trucker whom I have been in conversation with via email and facebook. Tilden Curl got me in contact with his insurance agent, who responded to the above information with his own estimate:

Hello Marianne and Tilden,

 My condolences, Marianne, for your loss. My heart is heavy for you as Tilden spoke of your story and inquiries to me yesterday. Admittedly my thoughts drifted to you & your daughters while I passed a number of tractor/trailers on the freeway just last night. . . 

Due to so many factors the variance of premiums is enormous. We have seen some at $1,800 all the way up to $9,000 annual.

Historically, since the current minimums were mandated back in early 1980s, a good average would be the $5,000 mark. It does tend to flow up and down with the economy, markets, catastrophic events, and such, but a good average is the $5K.

I can only speculate on what the premiums would be if federal mandate were to be elevated to a $1.5MM, $2MM, $3MM or even $4.2MM limits.

The numbers estimated in the other emails seem pretty low to me. I would think closer to:

1.5MM – $6,200 +/- annual

2MM – $7,000 – $7,500

3MM – $7,800 – $8,400

4.2MM – $8,600 – 9,300

Mark D. Johnson

HUB International Transportation Insurance Services, Inc.

Even if we go with the second estimate, $9,300, this is still only an increase of $4,300 from a current $5,000. Compare this to the “early estimate” of $20,000 or more, which is what is being told to truckers and would increase their premium by $15,000/year.

Thus, the estimates I have been given are at least $11,700/year less than what truckers are apparently being told. Big difference.

Furthermore, I am assuming, that Congress has been told that the rates will skyrocket and go up to $20,000. So the question is:  Did Congress vote upon the THUD Appropriations Bill — to take away funding from FMCSA which would allow them to continue the rulemaking on this vital matter (previously authorized by Congress) — based on INACCURATE information?

Read about that here:

Truckers, Please help me find out the facts on your insurance rates.

I have tried in every way I can think of, but I just cannot get anyone to give me any actual rates which a truck driver could expect if minimum liability insurance were to be raised by the federal government for interstate trucking.

(Read about my search for information here: http://annaleahmary.com/2015/06/my-crash-course-on-underwriting-for-trucking-minimum-liability-could-impact-you/ )

I have a few leads which I am waiting to hear back on, but I am not holding my breath.

So, I thought that I would turn to truckers themselves and ask for help in discovering what the truth of the matter is: Will rates actually skyrocket and put independent owner operators out of business? That’s what I hear. Is that the truth?

If you are a trucker, please contact your insurance carrier and ask them what your current annual rate is for liability insurance and what it would be if the minimum level were to be raised from $750,000 to $4.2 million.

Then, please let me know what you find out. You can comment on this post or send me a Tweet at my Twitter account or a private message at our facebook account. If you don’t feel comfortable about letting me know, please talk to each other about it and see what you think.

Twitter Account: https://twitter.com/MaryandAnnaLeah

Facebook Account: https://www.facebook.com/pages/In-Memory-of-AnnaLeah-1995-to-2013-and-Mary-Lydia-Karth-1999-to-2013/464993830249803

Thanks!

Marianne, standing up for truck safety in memory of AnnaLeah and Mary

AnnaLeah and Mary