Why Insurance Costs are Sky-High
Adopting more technological advances is the most likely route to cut back insurance costs, including leveraging solutions to curb distracted driving and other unsafe behaviors. Photos: iStockPhoto
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Adopting more technological advances is the most likely route to cut back insurance costs, including leveraging solutions to curb distracted driving and other unsafe behaviors. Photos: iStockPhoto
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With all the standard and optional safety technology that trucks and their drivers fairly bristle with these days, no one could fault a fleet manager for thinking their commercial insurance costs should be going only one way… down. But instead, they’re going up and up.
The problem is affecting everyone from owner-operators to the biggest players in the business. Even a powerhouse like regional/interregional LTL and 3PL provider Saia is feeling the pinch.
Discussing key cost trends in the firm’s 2016 earnings release, Saia President and CEO Rick O’Dell said one significant expense item was its claims and insurance line, which increased by more than $4 million in the fourth quarter versus the prior year. “The increase was not the result of one or two major accidents; rather it reflects the general inflationary trends in the costs of settlement and litigation in the trucking industry.”
Last year, more than $700 million in claims were recorded against trucks and other commercial vehicles, according to a recent Marketplace report by American Public Media, which points out the obvious: “Those losses are translating to higher premiums for businesses.”
San Diego-based Storrs Insurance Group, which does business as The Insurance Store, walks through why insurance costs are spiking in a detailed post on its blog. It reports seeing in the last few years “nothing but rate increases from most of our [insurance] carriers, both in small business auto insurance and commercial truck insurance.”
The increases have hit truck fleets of all types, from local to long-haul, from general freight to reefer goods, to dirt sand and gravel haulers — even operators of small service trucks. “Some have experienced even more rapid rate increases …Read the rest of this story
