5 More Great Best Insurance Practices for Better Premiums

More Great Best Insurance Practices

#65 Danger on the Tracks! What can be done to avoid collisions with trains?
#66 Avoiding the “Hazmat Placardable Inspection” Trap
#67 Motivating Safer Drivers
#68 Create a Positive Safety Culture
#69 Deploy Driver Safety Scorecards

2021 Insurance Saving Tip #65

Danger on the Tracks! What can be done to avoid collisions with trains?

Train tracks are often hidden dangers. In some areas of the country, few tracks can be found, so drivers in those areas are not accustomed to highway-grade crossings. In other part of North America, it is impossible not to cross multiple crossings, and crossings become so ubiquitous they seem to be invisible.

The NHTSA classifies truck-train collisions as some of the most dangerous crashes for truck drivers.

“The primary crash types in terms of severe injury probability to truck drivers is the same as for all trucks. The most dangerous crashes are rollover (12.2%), collision with a train (9.5%), fire (6.3%), and collision with a hard fixed object (4.2%).”
—NHTSA Report: Heavy Truck Crashworthiness: Injury Mechanisms and Countermeasures to Improve Occupant Safety (2015)

☠️ Rail Crossing Safety Stats:

  • One person every 100 minutes—Each year nearly 1,000 people are fatally injured in train collisions.
  • Many more people are injured, some seriously.
  • Nine tractor-trailers a week collide with trains, some hauling hazmat.
  • 80 percent of crossings lack adequate warning devices such as lights and gates.

In addition to the hazards of “highway-grade” crossings, CDL and CLP drivers can face a mandatory license suspension (See Table below) whether or not a train is present for:

  • Not slowing down and checking if the tracks are clear
  • Not stopping, if the tracks are not clear
  • Not stopping, if always required to stop
  • Not leaving sufficient space to drive completely through
  • Failing to obey a traffic control device or the directions of a LEO
  • Failing to negotiate a crossing due to insufficient undercarriage clearance

Table 3 to 49 CFR §383.51: Disqualification for railroad-highway grade crossing offenses

Conviction First Conviction Second Conviction Third Conviction
Fails to slow down & check tracks . . . 60 Days Suspension 12 Days Suspension One Year
Fails to stop, if not clear . . . 60 Days Suspension 12 Days Suspension One Year
Fails to stop, when required . . . 60 Days Suspension 12 Days Suspension One Year
Fails to have sufficient space to drive completely through . . . 60 Days Suspension 12 Days Suspension One Year
Fails to obey a traffic control device or the directions of a LEO 60 Days Suspension 12 Days Suspension One Year
Insufficient undercarriage clearance 60 Days Suspension 12 Days Suspension One Year

What to do?

  • From time-to-time, review proper railway crossing procedures with drivers and operators for approaching, negotiating, and dealing with crossings and multiple-track crossings.
  • Encourage drivers to avoid routes that go over highway-rail crossings.
  • There’s no such thing as “unused tracks.” Assume all crossings are active.
  • Freight trains do not follow a schedule.

Operation Lifesaver (oli.org) provides no-cost rail crossing-safety resources:

  • Safety information
  • Media, including posters
  • Speakers for safety meetings

2021 Insurance Saving Tip #66

Avoiding the “Hazmat Placardable Inspection” Trap

Inadvertently hauling Hazmat can trigger:

  • Tighter Hazmat BASIC percentages and subsequent alerts . . .
  • In turn leading to a DOT Audit or other DOT interventions and higher insurance for several years.

Why should Hazmat be a concern to a non-Hazmat hauler?

  • Excluding bulk shipments (single containers exceeding 119 gallons for liquids, 882 pounds for solids, and 1,000 pounds for gases), about 94 percent of individual Hazmat shipments are transported by truck. For example, many common consumer goods as adhesives, batteries, cleaning solutions, paints, and swimming pool chemicals are considered hazmat.
  • Size of the vehicle does not exempt a hauler from the hazmat rules. The rules apply to ANY vehicle transporting HM in a quantity requiring the display of a HM placard
  • Hauling intrastate or locally is not an exemption from the hazmat rules.

Hazmat is complex.

“The Hazardous Materials Table in the regulations contains a list of these items. However, this list is not all-inclusive. Whether or not a material is considered hazardous is based on its characteristics and the shipper’s decision on whether or not the material meets a definition of a hazardous material in the regulations.” CDL Manual, Chap. 9 Hazardous Materials

How can hauling Hazmat lead to a DOT Audit or other intervention?

  • To fully understand this question, first one needs to be aware of the criteria for DOT Audits. The DOT is data driven, gathering information from Roadside Inspections and crash data that filters into its Safety Measurement System (SMS) and into seven BASIC (Behavior Analysis and Safety Improvement Category).
  • If the BASICs exceed a certain percentile threshold, or the carrier has had an Acute and/or Critical Violation in the last year, then the BASIC can go into an “Alert” status.

Here’s the trap: Hazmat thresholds (See chart below) will apply to a motor carriers if:

  • If they had two HM inspections in the last two years (one within 12 months), and
  • Hazmat inspections are 5% of all inspections (SMS Methodology)
BASIC Passenger HAZMAT All Others
Unsafe Driving



50 60 65
Driver Fitness


Veh. Maint.

65 75 80
Hazmat 80 80 80

Your company may have acceptable BASICs, (between the Hazmat and All Other categories), that are under the Alert thresholds, but even though it is not a hazmat hauler, find itself held to a higher “Hazmat” standard by being cited for hauling Hazmat, twice in the last two years (incl. once in the last 12 months), with the Hazmat inspections being over 5% of your total inspections.

This in turn, could result in a DOT Audit or intervention.

If your BASICs are in an Alert status, this is not viewed favorably by most insurance companies.

What to do?

  • If you are not a Hazmat hauler, there is no requirement to train your drivers and operators on Hazmat, on what they can and cannot haul, but it is a good best practice to do so anyway.
  • Mechanics, technicians and parts runners also need Hazmat awareness training, as well. They need to know how to transmit and store Hazmat. For example, throwing a case of starting fuel on the front seat of a pickup or service truck with a DOT Number, could result in a citation for improperly secured Hazmat (177.834A). Support personnel need to know the difference between Hazmat and any Materials of Trade (MOT) they might carry.
  • Don’t rely on shippers or anyone in the supply chain to screen their loads for placardable quantities. Even the best can make an occasional mistake.
  • Don’t rely on luck. Once could be an honest mistake. Twice is a pattern, as far as the DOT is concerned.
  • Set a higher standard for all of your BASICs. Keep them well below the Alert thresholds.


  • Several Hazmat inspections can result in being held to a higher DOT standard for audits and interventions.
  • Train your drivers and operators on Hazmat Awareness.
  • Train mechanics, technicians and parts runners, as well.
  • Set a higher standard for all of your BASICs.

2021 Insurance Saving Tip #67

Motivating Safer Drivers

  • We usually associate workforce motivation with what is known as extrinsic incentives, such as pay, benefits, bonuses and the like.
  • But the fact is, research show these type of motivators are on the bottom of the list, if you want people to go the extra mile.
  • The key to workforce motivation is found in balancing the extrinsic rewards with intrinsic rewards, such as more autonomy, account-ability, responsibility and challenging work.
  • But first, it is necessary to understand the different factors in work satisfaction and dissatisfaction. They are not directly related!
  • Most drivers and operators, with five or more years of experience have a high level of job satisfaction when it comes to the work.
  • But they can also be, at the same time, dis-satisfied with a job due to things as a weak company culture, rudeness, and a lack of camaraderie (mutual trust), leading to an exit from a position.
  • This ‘two factor’ theory of motivation was proposed by Frederick Herzberg.
  • Key Idea: Increasing job satisfaction may not lead to a decrease in job dissatisfaction.
  • Attention needs to be paid by management to both the things that increase satisfaction and the things that decrease dissatisfaction. This is a two-step process.

Decreased dissatisfaction comes from: better policies, a strong company culture and safety culture, effective supervision, and the like.

  • An example of improving the company culture might be adopting the “Golden Rule” as a core company value . . . Treat all customers, co-workers, and others as we would expect them to deal with us.
  • Another example, based on research, is to monitor dispatcher speech for rudeness and swearing directed at drivers.

“When dispatchers swear and are rude with drivers, it distracts them and impairs objective indices of their safety.” —Dr. Tim Judge

Increased satisfaction (motivating factors, or satisfiers) can arise from: recognition, more responsibility, training and development, more accountability, and so on.

  • An example would be ongoing engagement with drivers, as listening to their issues, or granting reasonable requests for time off.

Other motivational tips:

  • Hire more for attitude over experience
  • Fill managerial/supervisorial jobs from within
  • Don’t try to educate managers or supervisors; change their jobs. (Herzberg)
  • Put a strong emphasis on employees’ leaving comments. What is driving turnover?
  • Build a positive, more collaborative culture
  • Create a “Culture Book” or company culture video for new hires with everyone’s ideas in their own words about: What is our culture? What makes it unique? What do you like about it? —without talking to any others about what you or they write.
  • Encourage peer-to-peer recognition.

2021 Insurance Saving Tip #68

Create a Positive Safety Culture

  • A company’s culture reflects the attitudes and beliefs that underlie how things “really get done.”

“We want to focus on the ways that we’re different from everybody else. Well, actually, when we look at our behavior, we’re more similar than we might realize.” Jonah Berger, Ph.D., “Invisible Influence: The Hidden Forces That Shape Behavior

One way to think of a company’s safety culture is in relation to the emphasis put on the value of safety in every decision made by every individual in the company. It’s an invisible force that influences behavior.

“Safety culture is best defined and indexed by an organization’s norms, attitudes, values, and beliefs regarding safety.” TRC Synthesis 14The Role of Safety Culture in Preventing Commercial Motor Vehicle Crashes

A positive safety culture makes safety a shared responsibility.

“Everyone feels responsible for safety and pursues it on a daily basis.”  E. Scott Geller, Safety Evangelist

Why is a positive safety culture important?

Organizations with a positive safety culture have (among others):

  • Higher productivity and less turnover
  • Fewer compliance issues
  • Greater profitability in upturns;
  • More resilience in crisis situations and cyclical business downturns

How can you instill a positive safety culture in your organization?

  • Start by being more mindful about the language being used to describe safety events and what they mean.
  • For example, many companies have replaced the term “accident,” implying an event was out of anyone’s control, with the term “collision” or sometimes “crash.”

“About 94 percent of serious crashes are due in part to frequent and predictable driver errors, such as speeding, or driving while impaired or distracted.” (National Safety Council, The Road to Zero)

Other words to watch are “close calls” or “near-misses,” according to safety consultant Mark Paradies. They really are an indicator of more serious future safety events. A better term is precursor, implying something will likely happen, if nothing more is done.

Adopt what is proven to work through evidence-based strategies:

  • Management sets the tone for safety
  • Define safety and set measurable safety goals and milestones
  • Follow industry best practices (like this one you are now reading), found in the TRC Synthesis Reports, industry magazines, trade associations, conferences, etc.
  • Keep up with and deploy new fleet safety technology. Become an early adopter, to the extent possible
  • Evolve your safety programs and makes changes as needed
  • Foster a sense of shared responsibility and engagement
  • Focus on behaviors and behavior-based safety.

2021 Insurance Saving Tip #69

Deploy Driver Safety Scorecards

What are driver safety scorecards?

  • Driver safety scorecards, usually based off an onboard vehicle safety platform, are a tool to identify risky driver behaviors and aid in driver coaching and training.
  • As a bonus, many insurance companies look favorably on fleets keeping driver scorecards to assess and improve driver behavior.

Using onboard platforms, ELDs, cameras, or vehicle telematics, drivers can be monitored for risky behaviors (among others) as:

  • Following too closely
  • Hard braking (reducing speed by 8-10 MPH in 1 second)
  • Speeding, excessive speeding, hard accelerations
  • Hours-of-service violations, even seat belt use.

Benefits of driver scorecards include:

  • A reduction in risky driving behaviors
  • Opportunities to coach and train drivers
  • A reduction in high-risk drivers and lower crash rates
  • More efficient and productive use of the vehicle

Driver Scorecard Tips:

  • Obtain buy-in from top management and the drivers
  • Get your policy right first, before deploying the technology
  • Shape your policy to fit your drivers and operations
  • Over-communicate with drivers before and during deployment
  • Some companies post monthly the names of top and bottom ranked drivers.
  • Some companies also track driver CSA points on their driver scorecards.
  • Some companies have a designated driver coach to take calls from drivers who want to improve.

Financial Scorecard & Cost Implications:

  • Depending on the onboard systems already installed, initial costs may be low to moderate, with a good return-on-investment (ROI).
  • Improving driver safety performance and lowering crash rates will improve your insurance risk profile and can help stabilize premiums.

Check with your agent or broker if any Driver Safety Scorecards discounts are available.

Representative Platforms (among many others)

Thank you for reading this. ■

5 More of the Best Insurance Practices Leading to Lower Truck Insurance Premiums

More Best Insurance Practices:

#60 Elevate Your Company’s Safety Ethos
#61 Review your Driver/Operator Manuals for Compliance and Accuracy
#62 Institute a Written Safety Incentive Program?
#63 Don’t Forget the Basics . . .
#64 Lagging vs Leading Indicators: Are you measuring Success or Failure?

2021 Insurance Saving Tip #60

Elevate Your Company’s Safety Ethos

What is Safety Ethos?
Why is our company’s safety ethos important?
How can we elevate our safety ethos?

Ethos is defined by Merriam-Webster.com dictionary as “the distinguishing character, sentiment, moral nature, or guiding beliefs of a person, group, or institution.”

⦁ Webster’s goes on to say, “Ethos means “custom” or “character” in Greek. Today ethos is used to refer to the practices or values that distinguish one person, organization, or society from others.”

⦁ “Formal : the guiding beliefs of a person, group, or organization.”

⦁ Your company or organization has an ethos. Call it street cred, public perception, reputation, or whatever.

⦁ Your ethos, essentially, is based on what employees, customers, suppliers, partners, and others believe about your organization and who you really are all about.

⦁ Why should we care about our safety ethos?

Inaccurate, but public, social media reviews might form part of that ethos.
Here are some online reviews of one company:
“Nothing but liars.”
“The company is trash.”
“Terrible people to work for.”

Publicly available government compliance reporting can form part of that ethos.
Typical sites can include:

You want your company to be the best. The employer of choice. The supplier of choice.

But mistakes can occur . . . even to the best. In the event of litigation, the facts may well be in your favor, but many times the outcome is determined by what a jury believes they “know” about your company and how you do business. Your ethos.

Based on a jury’s perception of your ethos, there may be an effort made by the plaintiff’s attorney to extract not only damages, but also punitive damages . . . damages not covered by insurance.

“The best defense is an offense.” George Washington

The same is true of your safety ethos.

A strong organizational ethos will result in attracting the customers you want to serve, and the employees and suppliers you want to work with.

And while your insurance company has a duty and obligation to defend you in court, there is only so much it can do, if you have not done the right spadework to shape and guard your ethos.

How can we elevate our safety ethos?

Some actions leading down the path to a better safety ethos include:
⦁ Become a more people-centered organization. Put people first in whatever you do. Don’t play the name, shame, and blame game.

⦁ Become more proactive in safety initiatives

⦁ Adopt more forward-looking safety metrics. For example, our previous best practice (#59) was about encouraging your workforce to make their safety concerns and suggestions known. These can be, for example, tracked and compared against safety warnings. The goal would be to have more safety concerns and suggestions made known than safety warnings made.

⦁ Network more: build a caring community. Get more involved.

⦁ Adopt a safety-ethos mindset. Simply being more mindful of the big picture can be a big step towards a better safety ethos and company ethos

2021 Insurance Saving Tip #61

Review your Driver/Operator Manuals for Compliance and Accuracy

⦁ Your Driver/Operator Manuals can become an effective communication tool for both the company and workforce.
⦁ But any good tool, to remain effective, needs occasional maintenance and even updating.
⦁ Some insurance companies will ask for your Driver/Operator Manuals as part of the loss-control review.
⦁ It’s best to consider your Driver/Operator Manuals as legal documents, that may be cited in future hearings or even litigation.

General Driver/Operator Manual construction:
⦁ Any written document needs to be both accessible and readable. That could mean, in the case of your employee manuals, having both electronic and hard copies available, a table of contents and a simple index.

⦁ In this age of rapid changes, the ability to make revisions when needed is important. Having a master document template, which is revised as needed, can be helpful.

⦁ Keep it at a “brain-friendly” level of communication. (See Tip 53)

⦁ For example, Brian Fielkow, a Safety Evangelist and CEO of Jetco Delivery, recommends having your employees help write the manual for better readability and understandability. He put representative members of his organization in a room with a writer to produce his manual.

⦁ Having frontline employees help make and write the rules under which they will work, is an example of taking advantage of the “commitment effect.” Fielkow is proud of his much lower-than-industry-average driver turnover at his trucking company.

Specific areas to cover in your driver manual might include (among others):
⦁ Be sure to have a general safety policy, stating the expectation that all employees will work in a safe manner, follow all safety standards and all local, state and federal rules and regulations, signed by management.

⦁ Laws and court holdings are frequently revised saying who can be an independent contractor (I/C) or owner-operator (O/O). If your enterprise employs I/Cs or O/Os, it would be prudent to make that distinction by having a separate manual for your driver/operator employers and another manual for your I/Cs or O/Os.

⦁ Have a section on how employee concerns about safety issues can be communicated to supervisors and management, and how these concerns will be followed up.

On a side note, OSHA oversees driver Whistleblower Protection. Not acknowledging driver or operator safety concerns or terminating a driver for refusing to drive a vehicle believed to have safety issues, can result in steep OSHA fines and the payment of back pay for any time off. Become familiar with these OSHA provisions.

⦁ Finally, from time to time, be sure to have a transportation attorney review your Driver/Operator Manuals. It is challenging for anyone in business these days, without good outside help, to keep up with the array of changes in laws, rules and regulations that govern the workplace, and what should or should not be included in any employee handbooks or manuals.

Periodic legal reviews will help to keep your manuals from later being used against you. They can continue to be an asset to the organization, not a potential costly liability.


1.) Brian Fielkow

2.) Kaitlin Gibson, VP Underwriting of fintech truck insurer Cover Whale Insurance Solutions Inc., put together a short guideline of some things they would expect in any driver manual.

2021 Insurance Saving Tip #62

Institute a Written Safety Incentive Program?

⦁ Why have a Written Safety Incentive Program?
⦁ What doesn’t work well in safety incentives?
⦁ What questions should be asked in setting up a safety incentive program?
⦁ Final Considerations

⦁ Some economists say many shortages can be traced to government interventions in the marketplace. A real shortage has occurred in the hiring of both drivers and mechanics. And with current national policies, it’s not getting any better.

⦁ Data shows driver apps have fallen about 15% from a year ago, according to Recruiting Consultant Marilyn Surber of Tenstreet.com. Surber recommends all companies need to adjust to this new reality by closely looking at the benefits they offer and differentiating themselves by strong safety protocols. Sound advice. One component might be a written safety incentive program.

What doesn’t work well in safety incentives?
⦁ Most important of all, a written safety incentive program is not a stand-alone safety program in of itself. Incentive programs should be a part of your overall formal safety program—not a proxy.
⦁ Secondly, choose incentives carefully so they are motivating, not demotivating. Motivating type incentives may vary, as people are different.
So, what doesn’t work well?

Some incentives to avoid might include:
⦁ Incentives which will result in a decrease of reporting (lagging indicators) of incidents or accidents.
⦁ Pooling the “safe employees” for an annual grand prize drawing (like a motorcycle), which results in only one or a few winners.
⦁ Deducting amounts for performance from a pre-set cash incentive.
⦁ Deducting “points” which can be earned back, as employees may feel they cannot control when or how things occur.

Some incentives to avoid might include:
⦁ Incentives which will result in a decrease of reporting (lagging indicators) of incidents or accidents.
⦁ Pooling the “safe employees” for an annual grand prize drawing (like a motorcycle), which results in only one or a few winners.
⦁ Deducting amounts for performance from a pre-set cash incentive.
⦁ Deducting “points” which can be earned back, as employees may feel they cannot control when or how things occur.

Common questions in setting up a safety incentive program:
⦁ What are your goals and expectations?
⦁ Will it help raise awareness of safety issues?
⦁ Will it reinforce your formal safety program?
⦁ Will it improve safety by reducing losses?
⦁ Who will be eligible for the safety incentives?
⦁ Will the incentives be tied to a driver scorecard or onboard driver performance monitoring platforms? Will clean Roadside Inspections be included?

What type of incentives will you offer?
⦁ Certificates or letters of achievement (Monthly, quarterly, annually?)
⦁ Gift cards or cash bonuses
⦁ Wall Plaques
⦁ Paid time off
⦁ Company apparel, etc.

Who will be the program coordinator, to monitor and gauge the effectiveness (outcomes) of the program?

How will management show recognition for those who have earned the incentives?
⦁ Meetings
⦁ Bulletin Board
⦁ Newsletters / Direct communication

How will management kick-off and build up excitement for the program?1

How will employees know where they stand, at any given time?

Some final considerations in offering safety incentives:
⦁ Tilt the scales more toward the receiving of recognition in meeting expectations and goals, rather than in getting tangible things.
⦁ Top management involvement is crucial, from the get-go.
⦁ Keep drivers and operators, mechanics, etc., involved in the process, too.
⦁ Carefully consider the program’s goals, metrics, and incentives.

Perhaps run a pilot program with a control group and measure the results.

Safety behaviors to be awarded should include:
⦁ Attending safety training
⦁ Making safety suggestions
⦁ Completing vehicle inspections and pre-operational checks
⦁ Participation in driver and/or safety committees

Finally, don’t feel pressured by your insurance company or safety consultant to start a safety incentive program.
⦁ ROI of incentive programs can be low: In some situations, costs may outweigh the benefits
⦁ A strong commitment to safety, involving employees in the safety process—allowing them to set safety goals—and having a high set of safety standards may result in better outcomes, with or without a safety incentive program according to some safety experts.
If your insurance company makes this suggestion, be sure to ask them for a proven working model to follow.

2021 Insurance Saving Tip #63

Don’t Forget the Basics . . .

 “Common things happen commonly.” —Anon.


⦁ We will look at three examples, all involving violation of basic safety rules, all resulting in severe safety events . . .

Example 1: A supervisor told the driver to leave the keys in the tractor. It was then stolen from the lot where it was parked. The thief drove it erratically before striking a family car, and seriously injuring a child. The tractor was abandoned, and the suspect remains at large.
Basic Rule violated: Always remove the key from the ignition and secure the vehicle.
Settlement Amount: $7 million

Example 2: A forklift entered a trailer, resulting in a forward movement of the tractor-trailer. The forklift dropped four feet to the ground injuring and incapacitating the driver.
Rule violated: Always set the brakes and chock the wheels when docking.
Settlement Amount: $4,825,000

Example 3: A driver of a tractor trailer was operating a tractor trailer on cruise-control at 58 MPH when the unit lost control, slid on ice, resulting in a jackknife blocking the left lane and part of the right lane. The driver left the vehicle but did not activate the emergency flashers or set out reflective triangles. In the ensuing pileup, four people were fatally injured, and multiple vehicles destroyed.
Rules violated: Using cruise-control in slippery conditions; Not activating warning devices to warn other motorists of the vehicle across the lanes.
Settlement Amount: $16.5 Million

⦁ In these three examples, violations of simple, basic, fundamental safety rules resulted in severe injuries, death and destruction.

⦁ In these examples, the vehicles were not in motion, when the driver error(s) occurred, yet all resulted in serious accidents, with corresponding liability for the companies owning the trucks.

How can these situations be avoided?

Start your season right . . .
Vince Lombardi is considered one of the greatest football coaches of all-time winning five NFL Championships in seven years, including three in a row.
Lombardi would start each season based the assumption his players had forgotten everything from the prior year.
Lombardi would start his first training session by holding up a football in his right hand, saying, “Gentlemen, this is a football.”

⦁ This concept of starting with the basics can be carried over to your driver and operator training.

⦁ One best practice is to assess drivers and operators on the basics, then, if necessary, provide gap training. This assessment can occur during orientation, safety meetings, etc.

⦁ Driver and operators need to become knowledgeable on your safety policies and the rules of the road. Not everybody with a CDL has attended formal training before taking the CDL road test. Some states issue driver’s licenses to adults without any kind of formal training.

⦁ Reinforce your training. Training in the basics can be followed up with a later assessment, then reviewed again, at another time.

⦁ Drivers and operators need to know all the basics of regulatory rules and requirements they operate under. This might include (among others): inspections, chaining rules in winter, hours of service rules, using ELDs, drug testing requirements, proper load securement, operating in adverse weather, and so on.

⦁ Training on the basics should be continuous and periodic throughout your drivers’ and operators’ tenure at your company.

“Perfection is not attainable, but if we chase perfection, we can catch excellence.” —Vince Lombardi

“Winning is not a sometime thing. It’s an all the time thing.
You don’t win once in a while.
You don’t do things right, once in a while.
You do them right all of the time. Winning is a habit. Unfortunately, so is losing.” —Vince Lombardi

2021 Insurance Saving Tip #64

Lagging vs Leading Indicators: Are you measuring Success or Failure?

Early warning systems are necessary to indicate when safety performance is deteriorating, safeguards are failing, or to reveal problems before a safety event or incident occurs.

An indicator is a measure of change over time. It may also be called an index or a measure or metric.

For example, accidents, collisions, incidents, “near misses,” etc., can be, with proper analysis, lagging indicators or measures of past performance.

There is no need, however, to wait for an accident, collision or some other events to measure safety. Leading indicators can be forward-looking measures of future safety performance.

For example, in working with data you already have, some lagging indicators, such as a series of collisions or “close calls,” if they occur repetitively or together in certain combinations, can also serve as leading indicators.

OSHA, for example, defines leading indicators as: “proactive, preventive, and predictive measures that provide information about the effective performance of your safety and health activities.”

Examples of leading indicators might include the tracking of: attendance at safety meetings or training; the completion of inspections or pre-operational checks; the reporting of safety faults or defects; the making of safety suggestions, and so on.

In selecting a leading indicator, start with an objective, problem, target or goal. The measurement provided by a safety metric is not about proving something; it is about improving. It is a means of measuring progress towards (or away from negative) goals.
An example could be improved roadside inspections.

Setting some goals for Roadside Inspections
Roadside inspections are costly in lost productivity and fines, but failed inspections can result in a higher CSA “points.”
• Drivers with clean roadside inspections – Goal: 90%
• Total aggregate CSA points for the fleet per month–Goal: X points
• CSA points per BASIC* per month – Goal: X points
*Behavior Analysis Safety Improvement Category

What data should you collect for a leading indicator to improve roadside inspections?

Some choices might include:
•Time spent on pre-trips/post-trips: Are they be done correctly?
•Quality of pre-trips/post-trips: Have any cited defects been reported by the driver? Are the defects found on roadside inspections a driver-side issue, or perhaps a repair-shop issue?

Next, from time-to-time measure the progress made toward your goal and take appropriate action if you are not meeting it.

For example, driver time spent on pre-trips could be reviewed weekly, and roadside inspection results reviewed monthly.

The last step could be a periodic review of your objective, problem, target or goal, and your leading indicator. Are you meeting your goal(s)? Is the leading indicator serving your goal(s)? Should anything be further adjusted or changed?

The long-term rewards of managing safety performance with indicators are:
⦁ Improvements in safety performance and turnover
⦁ Less potential for litigation and loss of control
⦁ Fewer compliance and regulatory issues
⦁ A systematic risk management approach
⦁ Lower workman compensation insurance
⦁ Lower insurance fleet premiums ■

“One accurate measurement is worth a thousand expert opinions.” —Grace Hopper


“The measure of success is not whether you have a tough problem to deal with, but whether it is the same problem you had last year.” —John Foster Dulles


OSHA’s Using Leading Indicators to Improve Safety and Health Outcomes

5 of the Best: Insurance Best Practices to Save You Time and Money

Best Insurance Practices

#55 Check out the “Finding Affordable Insurance” Guide
#56 Eliminate Cargo Claims in 3 Bold Steps
#57 Understanding Surplus Insurance
#58 Finding Good Low-Cost Safety Training Resources
#59 It’s Definitely Okay to Speak up for Safety!

2021 Insurance Saving Tip #55

Check out the “Finding Affordable Insurance” Guide

The National Accounting and Finance Council (NAFC), is a dues-based, membership-based council, a part of the American Trucking Association (ATA). The NAFC helps its members in addressing the business challenges facing the trucking industry.

The NAFC and the ATA’s Insurance Task Force (ITF), formed a working group of attorneys, insurers and motor carriers to provide information for its members in obtaining affordable insurance.

The result of their work is the “Finding Affordable Insurance” Guide.
⦁ The “Finding Affordable Insurance” Guide is available to both members, and non-members.
⦁ According to Jennifer Wieroniey, Executive Director of the NAFC, the guide helps companies ”prepare for renewal by getting their safety and loss documentation in order early, developing a risk-retention strategy and presenting the best possible case to underwriters.”

Please contact Jennifer Wieroniey directly, if you have any questions.
⦁ Jennifer Wieroniey, Executive Director, NAFC
950 N Glebe Rd., Suite 210
Arlington, VA 22203-4181

⦁ Phone: (703) 838-1782
⦁ Email: nafc@trucking.org​
⦁ The “Finding Affordable Insurance” Guide

2021 Insurance Saving Tip #56

Eliminate Cargo Claims in 3 Bold Steps

⦁ What are cargo claims?
⦁ What drives cargo claims?
⦁ How can cargo claims be reduced or eliminated?

⦁ There’s a saying amongst experienced drivers,

“You don’t drive the truck, you drive the load.”

⦁ But even with good, experienced drivers, good equipment, and good roads, cargo claims reoccur and seem inevitable.

What can be done?

The Carmack Amendment to the Interstate Commerce Act (49 U.S.C. § 14706) holds haulers for hire (motor carriers) and freight forwarders, in interstate commerce, to a standard of strict liability in taking possession of and in hauling property.

⦁ Subsequent court holdings have expanded liability to brokers, depending on how they represent themselves, and Carmack does not preempt state laws for brokers, as it does for haulers.

Cargo claims can arise from (among others):
⦁ Damage (noted at time of delivery)
⦁ Loss (freight tendered, but never delivered)
⦁ Shortages (partial or less than full delivery)
⦁ Concealed damage or shortage (discovered after the freight has been delivered and signed for).

Step 1: Know your cargo. Know your load.
What type of freight and commodities will you or do you haul? Everyone in your company should know and be drilled on your “Do Not Haul” list. A second “Call Before You Haul” list also needs to be common knowledge.

What should be on your “Do Not Haul List?

⦁ Anything excluded by your cargo insurance. This list should be reviewed and checked again after each new policy or renewal.
⦁ Anything beyond your cargo insurance policy limits. Look for caps or limits on certain items in the policy.
⦁ Anything that requires equipment you do not have, or drivers lacking adequate experience in hauling that type of freight.

⦁ Contraband—as cannabis (See Tip #19) or anything illegal
⦁ Mystery or sealed loads with unspecified cargo aboard
⦁ Commodities which require special permits, licenses, or placards that you don’t have. This could include (but is not limited to): flammables or combustible liquids, explosives, compressed gasses, acids, hazmat, perishables, or high-dollar loads, beyond the extent of your cargo insurance.

⦁ Anything beyond the capacity of your equipment or the capability of your driver(s). Examples might include: placing steel in dry vans; paper rolls or beverages hauled by drivers lacking or having limited experience with these items.
⦁ Anything that can’t be counted but should be, when loaded.
⦁ Anything that cannot be properly secured

⦁ Anything that might be too heavy to haul or the weight cannot be properly distributed, or even ascertained.
⦁ Anything oversized, extending beyond legal limits or requiring an escort, that is not available.
⦁ Anything requiring travel over bridges and tunnels with an item banned on that part of the road.

⦁Your “Call Before You Haul List” could include:
⦁ Anything that might be considered hazmat or hazmat lacking proper shipping paperwork or placards, or a driver without a hazmat endorsement, if required
⦁ Anything unusual as: Artworks, antiques, pharm, automotive engines or small engines, electronics batteries, fluids, etc.
⦁ Anything needing more clarification or proper paperwork.

Other Exposures . . .

⦁ Reefer loads require a high level of knowledge including how to properly set, monitor, and fuel the reefer; how the load needs to be distributed for proper air circulation; proper cleaning and washout methods before and after loads; precooling the trailer before loading, checking the temperature of the product being loaded before, during and sometimes after the trip, and so on, at all hours of both the day and night.

⦁ Tanker loads for food and other commodities, as well as heavy haul, open-deck, dry bulk pneumatic, and other specialty loads are beyond the scope of this general cargo brief.
⦁ Every different trailer and particular load has its own unique set of risks (exposures), which require special knowledge and experience and its own set of minimum standards.

Step 2: Ensure everyone is onboard on what can and cannot be hauled, who can haul it, and with what equipment. Again, for example, a good driver with lots of dry van experience may not be qualified to haul steel or paper rolls in a dry van.
⦁ Make sure drivers know how to properly secure their loads, or if even the load can be secured.
⦁ Always ask for any special load instructions before dispatching a truck for the load

Step 3: Ensure you have high enough limits on your Motor Truck Cargo. About $250,000 in coverage is not unusual. More may be required, depending on the load.
⦁ Check for any special clauses or limits in your cargo insurance. There is no such thing as a “standard” cargo policy.
⦁ Be sure you both do and document everything your insurance agreement expects you to do.

Defenses for losses might include:
⦁ Act of God: tornados, hurricanes, floods; or an Act of Public Enemy: a loss due to an attack
⦁ Act of the Shipper: The shipper is totally responsible for the damages incurred
⦁ Act of Public Authority: Example your load of bottled water was seized in an emergency zone by local authorities
⦁ The Inherent Vice or Nature of the Goods Transported: Ex.: Steel that rusted due to humidity, even though the carrier securely tarped the load.

 Additional actions include:
⦁ Ensure the driver takes pictures of the load when delivering, before unloading, after the seal is broken, showing the condition of the cargo.
⦁ Take pictures showing any damage done while unloading.
⦁ The burden of proof is always on the motor carrier to prove cargo damage was not due to the carrier’s negligence.

 Study your cargo claims:
⦁ Look for the root cause in each claim
⦁ Make sure the insurance company is made aware, if the claim was not your fault.
⦁ Take the appropriate steps to improve and eliminate your cargo losses.

In Summary:
⦁ The Carmack Amendment puts liability for cargo on carriers and freight forwarders, in interstate commerce.
⦁ Brokers can be liable, depending how they represent themselves to the shipper

⦁ Step 1: Know your cargo. Know your load.
⦁ Have a Do-Not-Haul and a Call-Before-You-Haul list

⦁ Step 2: Get everyone onboard on what can and cannot be hauled
⦁ Ensure staff is aware of what they can and cannot haul, when to call in, if not sure, and how to properly secure and distribute the load.

⦁ Step 3: Make sure you have adequate cargo insurance and know what is disallowed and what any coverage limits are.

Document any losses at delivery.
Study your losses.

2021 Insurance Saving Tip #57

Understanding Surplus Insurance

What is surplus insurance?
You may have heard of the term “surplus” insurance. Surplus insurance covers these three basic categories:
⦁ (1) “non-standard” risks, with unusual underwriting characteristics (new company, special circumstances, etc.)
⦁ (2) unique risks; (high risk, one-of-a-kind, etc.), and
⦁ (3) “capacity” risks, with higher coverage levels than average

Other names for surplus insurance include: specialty, non-admitted, excess lines, excess and surplus (E&S), or the “nonadmitted market: (meaning the insurance company itself is not formally licensed with the state to provide insurance but rather must sell through a state-licensed agent or broker).

Why would you need surplus insurance?

⦁ One reason many companies obtain surplus insurance is they have been declined by the admitted insurance companies.
⦁ Insurance companies like to “pool” risks with similar risks. If your company has a unique situation, doesn’t a loss history to review because it’s a new enterprise, or had a series of recent losses, making it difficult for underwriters to classify or understand in full, and several insurance companies decline to quote you, then the only option might be surplus insurance.

⦁ Under 10% of the total property and casualty insurance market is “surplus insurance.”
⦁ It is considered a strong market, as rates are commensurate with risk, higher than standard insurance.
⦁ Because it is “non-admitted” insurance, it follows fewer state rules and regulations about fees it can charge and the risks it can cover.

Who sells surplus insurance?

The surplus insurance market is dominated in the U.S. by Lloyd’s of London, which had about 22% of the market in 2019. Sometimes Lloyd’s insurance is sold and underwritten through domestic insurance companies and their brokers.
⦁ Other players include: American International Group (AIG), Markel Corporation Group, Nationwide Group, W. R. Berkley Insurance Group, Berkshire Hathaway Insurance Group, Chubb INA Group, Fairfax Financial (USA) Group, and Liberty Mutual, and others.

What to expect, if you need surplus insurance?
⦁ The policy may be different than a standard policy, so be sure to carefully review it.
⦁ The premium may be higher, and there can be additional fees.
⦁ Expect a loss-control review of your operations, to help assess and develop recommendations to lessen risks.
⦁ Be sure you understand all the provisions and any exclusions. ■

⦁ See: FAQs from the Surplus Lines Association of IL

2021 Insurance Saving Tip #58

Finding Good Low-Cost Safety Training Resources

⦁ Why do we need to train our operators and drivers?
⦁ What training topics should be covered?
⦁ How much training is needed?
⦁ Where can good low-cost training resources be found?

Why is training necessary?
⦁ One reason is the array of new safety technology introduced onto vehicles and construction equipment. It can be truly a double-edged sword if the operator or driver does not know how to use it, or worse, if the operator becomes distracted by it, and later it was found to have contributed to a mishap or the features are intentionally turned off.
⦁ Do your operators and drivers know both the limitations and capabilities of your vehicle’s technology?

Other reasons for training and retraining are that

a.) all skills are perishable, and

b.) without an occasional refresher, training can become stale or even forgotten.

For example, training on emergency procedures or steps to take in an accident may never be used for years and can become fuzzy when it is most needed.
⦁ “Brains exist on a big distribution—so everyone’s reaction can be quite different in an extreme situation,” says Dr David Eagleman, PhD. Brain response is helped by knowing what to expect by training.

Training topics should include:
⦁ Critical, task-specific safety training, before the task(s)
⦁ Mandated certifications and recertifications
⦁ General safety training
⦁ Training to meet or exceed any compliance requirements, including new rules and regulations
⦁ Advanced training, as Train-the-trainer, supervisory, leadership, etc.

How much driver or operator training should we do?
⦁ The answer depends on the trainee’s level of skills and the tasks at hand.
⦁ For critical tasks, follow a rigorous training schedule.
⦁ Routine training can range from short, daily on-site toolbox talks to quarterly driver meetings.
⦁ Your insurance company likely will want to know more about your training policy. Be ready for these questions.

Where can good training resources be found?
⦁ Start with your insurance company. Many insurance companies differentiate themselves with a strong safety and loss control department. Best of all, it’s usually included in the premiums, so it will not cost anything at all.
⦁ Check internally. You may have more talent than you could imagine, that can be polished in a safety-development program.
⦁ Check the YouTube sites of associations, trade groups, even competitors. These can help you focus on current safety issues.

⦁ There is array of new safety technology on mobile equipment, regulation and compliance issues pointing to the need for recurrent workforce training. Without periodic training, needed skills can become stale.
⦁ Your insurance company may want the details of your program.
⦁ Low-cost training resources are available from: your insurance company, internally, and professional associations and trade groups. YouTube can be a source of low-cost, but high-grade training videos dealing with current or pressing safety issues.

2021 Insurance Saving Tip #59

It’s Definitely Okay to Speak up for Safety!

I was new and afraid to ask.

















“Safety is a communications problem.”

Kevin Burns, Safety Consultant

I thought I'd look stupid if I asked again.

















“According to my research, 80 per cent of all accidents or incidents are caused by some sort of error in communication and 15 % by lack of proper training.” Marco van Daal, Safety Evangelist

I thought I could wing it.

















“I believe that with some basic training we can reduce the number of accidents by 50 per cent easily.”
Marco van Daal, Safety Evangelist

Thank you for reading this. ■

Save Big on Commercial Vehicle Insurance . . . and More

Buy Low . . . Sell High!

While freight rates are high due to current market conditions, unfortunately, so is commercial auto insurance. It’s been on the rise for the last 18 months or so. And unfortunately, no one is predicting a drop in insurance rates in the foreseeable future. Market cycles seem to be longer in the insurance world.

In that spirit, here are some additional things, some “best practices” that the best companies are doing which can result in a better risk profile and lower premiums. This article covers:

#50 The Quick Fix for High Insurance Premiums
#51 The Mobileye Forward Collision Warning system 
#52 Understanding Driver Biometrics Liability 
#53 Brain-friendly communications . . . for the important stuff
#54 Do I need broker liability coverage?

Disclaimer: This is not legal advice, only information for possible ways to reduce risk, improve your risk profile, or save on insurance. Seek any legal advice from qualified legal counsel. Seek insurance advice from a qualified, licensed insurance agent or broker.

Best Insurance Practices

2021 Insurance Saving Tip #50

The Quick Fix for High Insurance Premiums

How insurance companies assess risk varies from company to company. Insurance risk-assessment models are considered trade secrets, based on a number of factors including your business’ history, how you run your business, how you approach things, and so on, not only recent claims.

In “hard markets,” however, insurance companies tend to circle the wagons. Their mandate can change, and they sometimes will over-scrutinize things that would not have been worth a second look a few years prior.

  • Part of this is based on pressure from their investors. Part of this is also pressure from the State regulators who make the rules under which they must abide.
  • One area is in the payouts for claims. A claim is a claim is a claim.

For example, a small operation with trucks filed four claims averaging about $1,500 each, and their policy was not renewed. They had to scramble to find a new insurance carrier and their agent advised the owner, in the future, to not even file anything under $20,000.

  • While four small claims are not statistically significant, as they could happen to anyone, the owner was doing everything right and yet still found himself in a bad spot with his insurance company.
  • What was the problem?

This could be looked at from a few ways. Had the owner paid out of pocket, he would have not filed the claims, and would likely have been renewed.

  • Someone might have also suggested increasing his $1,000 deductible. Perhaps his agent did suggest that, but at the time it was shrugged off.
  • The lesson here, in this time of unruly insurance companies, is to seriously look at your deductibles. As in the above example, a deductible can be too low, and work against you.
  • What can you do?

While everyone’s situation is different, start by looking back at your claims history. How much is your average claim? How often do they occur?

  • Get an insurance quote based on several deductibles, starting with your ideal number, then bumping it up. A higher deductible should result in not only lower premiums but lessen the number of claims paid by the insurance company.
  • How much collateral do you have? Are you able to escrow the amount of the deductible? Not paying a deductible when due can result in policy cancellation.

Savings from lower premiums should be set aside to cover possible future claims and deductibles.

  • Deductibles can be slowly bumped up, from year to year (stair-stepped).
  • A higher deductible can substantially reduce your premiums.
  • Be sure to have a program in place to reduce accidents and collisions in the future in both in number (frequency), and in size (severity).

“The Quick Fix” Summary

  • Insurance companies are under pressure to lower the number of claims they pay out on.
  • Increasing your deductibles (retention) can both lower your premiums and improve claim payouts made by the insurance company.
  • Finding the right deductible for you is more art than science. Work with your agent or broker to ensure your deductible isn’t too low or too high.
  • At the same time, renew your efforts to improve your claims history.

2021 Insurance Saving Tip #51

Install the Mobileye Forward Collision Warning system
on your Vehicles

What is Mobileye?

  • Started over two decades ago in a garage with the mission of improving camera-based technology to make mobility safer.
  • In 2011 the company introduced the world’s first OEM production vision-only Forward Collision Warning system.
  • Their various systems are installed on over 60 million vehicles on the road.

Why a forward collision avoidance system?

  • Says Mobileye: “Rear-end crashes are one of the most common types of collisions. They are often the result of drivers following too closely or drivers that are distracted or speeding. In fact, 40% of rear-end collisions have no brake application whatsoever, reflecting driver distraction. The NTSB has found that over 80% of rear-end crashes could be prevented with forward collision avoidance systems.”


While newer trucks have built in advanced driver-assistance systems (ADAS), with a number of functional features, the Mobileye Forward Collision Warning system has a device which can be added-on or retrofitted to vehicles without an ADAS.

  • This makes it possible to upgrade every vehicle in your fleet with a forward collision warning system to help eliminate most rear-end collisions.
  • There are no monthly fees after the initial installation.

Contact information:

1350 Broadway, Suite 1600
New York, NY 10018
Tel: 1-877-867-4900

2021 Insurance Saving Tip #52

Understanding Driver Biometrics Liability 

  • What are biometrics?
  • What is biometric information?
  • Why is use of biometrics data a recent concern?
  • Do I need a biometrics data use policy?

Biometrics are a person’s unique biological measurements including the physical characteristics of a person.

  • Biometric information refers to unique biometric identifiers such as a person’s fingerprints, facial patterns, voice, and iris recognition.
  • Use of biometric information, based on privacy concerns, is gradually being regulated by various states, opening up employers who use biometric data to fines or lawsuits.
  • In 2008, the State of Illinois passed the Biometric Information Privacy Act (“BIPA”), 740 ILCS 14.
  • On April 1, 2009, the Texas Statute on the Capture or Use of Biometric Identifier, Tex. Bus. & Com. Code Ann § 503.001, went into effect.
  • And the State of Washington passed House Bill 1493, the Washington Biometric Privacy Law, effective on July 23, 2017.
  • Other states and even some cities define and regulate the use of biometric data.

While biometric laws vary from state to state and city to city, almost all generally require:

  • An employee be given notice of the intended capture of the data
  • An employee consents to the use of the data, before capture
  • Disclosure, lease, or sale of biometric data is prohibited
  • The data is destroyed when no longer needed, per laws in effect
  • Illinois law requires a policy in writing, with specific elements
  • Insurance coverage for liabilities involving the use of biometric data should be discussed with your insurance agent or broker.
  • Policies (and any exclusions) covering biometric liability might include provisions found in:
    • —General Liability
      —Cyber Liability
      —Employment Practices Liability
      —Other coverage, as in Media Liability insurance

Best Practices should include the previous general requirements:

  • Give employees notice of the intended capture of the biometric data, before it is collected; What is collected, and why? How will it be used? Who will use it? Who will share it? When will it be destroyed?
  • Obtain the employees consent of the use of the biometric data, before it is captured
  • Do not maintain the biometric data beyond its useful shelf life, other than in meeting other legal requirements
  • Obtain employee “buy-in” before deploying any devices collecting biometric data as driver-facing cameras. Explain how the data not only benefits the company or organization, but how it will directly benefit them.
  • Create a biometric data policy for your organization.
  • Review your insurance program for any gaps in coverage regarding biometric liability.

Finally, be sure to consult with appropriate insurance, risk management, or legal professionals, if uncertain about biometric laws and requirements.

2021 Insurance Saving Tip #53

Brain-friendly communications . . . for the important stuff

  • How can we better communicate with operators and drivers?
  • What can be done to help our staff recall important messages?
  • How can we be more effective in our communications?

Everyday we communicate with operators and drivers. It starts on day zero and can continue, we hope, until their retirement.

  • Even experienced operators and drivers can feel overwhelmed or overloaded at times with too much information, too many directions, or with complex instructions.
  • One strategy used by top companies is to design their communications to be “brain friendly.”

You Must Remember This . . .

  • In order for your information to be useful, it needs to be put to good use. That is only possible, if the information is easy to recall.
  • Spoken words can only be recalled for several seconds. Remember the “3-second Rule” when conveying an important message, you want others to recall later.
  • Key Point: If you can say it in three seconds or less, it will likely be more memorable, therefore more actionable.

Keep It Simple!

  • Make sure the information is easy to recall by using simple language and relevant examples.
  • Use simple words and phrases, also known as plain language: familiar or commonly used words. (See plainlanguage.gov)
  • “Words move, examples compel.” Use examples or stories directly connected or related to the topic at hand.
  • It’s okay to occasionally pause and ask, if any additional clarification is necessary or, if the listener understands, so far.

Break It Up!

  • If possible, break up longer sessions into shorter ones. For example, break up a 90-minute topic into two 45-minute or even three 30-minute sessions, and spread them out. A week apart is best.

“Research on the forgetting curve shows that within one hour, people will have forgotten an average of 50 percent of the information you presented. Within 24 hours, they have forgotten an average of 70 percent of new information, and within a week, forgetting claims an average of 90 percent of it.” Art Kohn

“Brain Friendly” Summary

  • Design your communications to be brain friendly.
  • If you can say it in three seconds or less, it will likely be more memorable, therefore more useful.
  • Use simple, plain language: familiar or commonly used words.
  • Add in a few relevant examples or stories
  • Ask if further clarification is needed?
  • Break up or spread out longer sessions.

2021 Insurance Saving Tip #54

Do I need broker liability coverage?


  • Companies hauling freight (motor carriers) sometimes have customers with special needs that require more capacity or occasional loads with specialized equipment the hauler does not have.
  • To satisfy the customer, the motor carrier then obtains DOT authority to become a broker.
  • But do you need broker liability coverage?

A broker is defined in United States Code as:

49 U.S.C. § 13102:

The term “broker” means a person, other than a motor carrier or an employee or agent of a motor carrier, that as a principal or agent sells, offers for sale, negotiates for, or holds itself out by solicitation, advertisement, or otherwise as selling, providing, or arranging for, transportation by motor carrier for compensation.”

The DOT defines a property broker on its OP-1 application for authority as:

  • Broker of Property (except Household Goods) — An individual, partnership, or corporation that receives payment for arranging the transportation of property (excluding household goods) belonging to others by using an authorized Motor Carrier. A Broker does not assume responsibility for the property and never takes possession of it.

(c) Brokerage or brokerage service is the arranging of transportation or the physical movement of a motor vehicle or of property. It can be performed on behalf of a motor carrier, consignor, or consignee.

The DOT requires a surety bond (Form BMC-84) or a trust agreement, used in lieu of a surety bond (Form BMC-85) for broker authority. 49 CFR § 371.2 (c)

Meeting the DOT requirements means the decision to add liability insurance is a business decision, not a regulatory requirement.

If the business does not purchase insurance for whatever operations it is engaged in, then it is assuming all of the risks of liability.

What is the liability involved for a brokerage?

Brokerage liability can arise from (among other causes), tendering a load to a motor carrier :

  • without proper DOT authority, or insurance
  • with a questionable safety rating or safety history
  • that double-brokers the load to a third-party carrier
  • that provides fictitious information, or successfully evaded your best efforts for due diligence

Truck Broker Liability insurance covers companies operating with DOT broker authority.

  • It is a primary insurance, covering brokerage operations up to the limits of the policy, regardless of what other insurance policies are in effect.
  • It provides coverage for possible mistakes made at the time the load is tendered, resulting in later claims.

Do you need the coverage?

  • As always, it is best to discuss your specific insurance needs with your agent or broker.
  • The insurance company will want to know how you vet carriers for brokered loads, before hiring them, what due diligence and due care you take in the vetting process, what your broker/carrier agreement looks like, and so on.
  • Also be sure to consider the counsel of a good transportation attorney. ■

Commercial Insurance Best Practices Save You Money

Best Insurance Practices

The following best practices are ways you can save money, avoid towing fraud, lower your out-of-service (OOS) scores, determine if an accident really is a DOT accident, and help stabilize rising insurance premiums.

2021 Insurance Saving Tip #45

Notify your Insurance Company on a claim . . . even if you have already contacted your Attorney

Some companies and organizations keep an attorney on a retainer basis to go over any potential legal issues, including accidents, incidents or potential claims.

Some attorneys simply insist on staying informed of any situations involving potential liability for the business.

And some attorneys may provide their clients with “coverage opinions,” on whether or not the insurance liability claim on their vehicle would be covered. They will review if the policy was in effect, if the claim involves the insured or an additional insured, if there were any exclusions to the policy, and any exceptions to the exclusions, if the terms and conditions of the policy apply, and what is the effect, if any, of the endorsements on the policy.

If you do discuss an incident or claim with an attorney, be sure to also report it to your agent or insurance company.

Says one insurance company, “While we all hope to not have a claim, we know that things happen. The first thing to remember is to report the incident to your insurance company immediately.” (IFG Claims page)

Why do some policyholders delay in reporting a claim?

Some policyholders fear that reporting incidents or claims will result in higher rates, more restrictive policy terms, or even a potential nonrenewal of the policy. It’s a legitimate concern.

Some want to “handle it themselves,” perhaps paying out-of-pocket (think twice before proceeding in this direction—as it can be seen later as a possible “admission of liability”), or they rely on counsel’s opinion that the potential claim “might not be covered.”

Reality check! Delay in reporting an incident or claim can result in forgoing your insurance company’s advice and assistance in resolving the matter. Only the insurance company can make the determination, if they will cover the claim. And to do so, any claim needs to be promptly investigated.

If not notified of a claim within a reasonable time, the insurance company may be relieved of their responsibility to defend, and ultimately pay the claim. This could be costly to your company, as in some claims, the defense tab can exceed the actual claim.

Make sure your workforce reports all incidents and accidents to you, so they get properly and promptly handled.

If you have a concern your premiums will jump because of the number or claims submitted, this could be a cue it might be time to find another insurance company. As one risk manager noted, the same insurance company raising your rates because of the number or claims submitted, is the same insurance company likely to also deny claims submitted. It might be better to pay a little more in premiums in return for better service.

In Summary:

  • Always promptly report any claims to your agent.
  • Don’t merely rely on your counsel to determine, if you are covered under an insurance policy. Let the insurance company make that determination.
  • Don’t pay any claims out of pocket, unless this has been agreed to by the insurance company.

2021 Insurance Saving Tip #46

A Quick Start to Lower Premiums

For some business owners, insurance is kept on the back burner for most of the year, except perhaps in the two or three months before renewals. There is always a lot going on in the business, and this insurance stuff always seems to eat up a lot of time and energy.

Reality Check: The market is firming up. Adopt a longer view, a long-term strategy when dealing with your insurance needs.

A change in mindset on how you approach insurance might be needed.

  • Can you change your structure to lower your insurance costs?
  • How much risk can you retain?
  • Are there other options in the marketplace?

Check with your agent or broker how much your premiums would go down with a higher deductible.


  • A 500 unit fleet, had a $10k deductible. Bumping that up to a $75k or $100k deductible might save them about $80,000 a year, if not more.

Some fleets “stair-step” higher deductibles, for example starting at perhaps $50k, then $75k the next year, and $100k the year after.

  • Even with a higher deductible, the claims process is the same—all claims are still handled by the insurance company.
  • Quick Tip: Retaining more risk (with a higher deductible) opens up the market to getting more quotes back from underwriting!

2021 Insurance Saving Tip #47

Was It an Accident? The Answer Could Affect Your Premiums

The U.S. DOT requires DOT regulated carriers keep an “accident register” or list of accidents with specific data.

All DOT “recordable accidents” should be listed on this required document (involving commercial motor vehicles (CMVs) rated at 10,001 pounds GVWR and greater).
Insurance companies also are interested in this information.

  • For DOT reporting purposes it is irrelevant whether an accident is classified as a “preventable” or “non-preventable” accident.
  • “Fault” does not matter here for recording purposes.
  • So what is an accident?
  • What is the DOT criteria for an accident?
  • Where is it found?

If the federal regulations were put in a book, then Part 390 would be called “Chapter One.”

Specifically, in the beginning section of 390.5 Definitions, the term “accident” is defined, as well as other terms and words that make up the definition.
To understand the definition, you need to understand all of it, including the terms as they are defined and used.

An accident . . .involves a CMV . . . on the highway . . . which results in:

  • (i) A fatality;
  • (ii) Bodily injury to a person who, as a result of the injury, immediately receives medical treatment away from the scene of the accident; or
  • (iii) One or more motor vehicles incurring disabling damage as a result of the accident, requiring the motor vehicle(s) to be transported away from the scene by a tow truck or other motor vehicle.

The DOT also excludes from the definition of a recordable accident:

  • Only boarding and alighting from a stationary motor vehicle; or
  • Involving only the loading or unloading of cargo.

Where it happen? A highway “means any road, street, or way, whether on public or private property, open to public travel.”

  • So a DOT accident can happen on any road, any where, if it is “open to public travel.” This could be a parking lot or yard, unless it was gated, guarded, or had some means of controlled access, making it NOT open to public travel. If access to the location was controlled, then it was not a DOT recordable accident.

Was anyone fatally injured?Fatality means any injury which results in the death of a person at the time of the motor vehicle accident or within 30 days of the accident.”

  • The DOT uses a thirty (30) day counting period for accident fatalities. If a person dies as a result of injuries received in a traffic crash with a CMV within thirty days of the date of the crash, that victim is considered a traffic fatality, and the accident is DOT recordable.

Was anyone injured? Bodily injury means injury to the body, sickness, or disease including death resulting from any of these.

  • The classification and type of injury are not important as the timing of the treatment. It must take place “immediately.” DOT says:
  • Guidance:The term ‘‘immediate’’ means without an unreasonable delay. A person immediately receives medical treatment if he or she is transported directly from the scene of an accident to a hospital or other medical facility as soon as it is considered safe and feasible to move the injured person away from the scene of the accident.
  • Question 20:A person involved in an incident discovers that he or she is injured after leaving the scene of the incident and receives medical attention at that time. Does the incident meet the definition of accident in 49 CFR 390.5T?
  • Guidance:No. The incident does not meet the definition of accident in 49 CFR 390.5 because the person did not receive treatment immediately after the incident.
  • Any type of vehicle, privately owned or an ambulance, may be used to transport an injured person from the accident scene to the treatment site, but it must occur immediately after the crash.

Some motor carriers only utilize the information listed on the police accident report. This can be misleading.

  • If there were really any injuries making the accident recordable, further investigation may be necessary to properly determine if any medical treatment was received, or if the person merely had a check up, or went for observations.

Was there any disabling damage requiring towing?

  • Disabling damage means damage which precludes departure of a motor vehicle from the scene of the accident in its usual manner in daylight after simple repairs.
  • (1) Inclusions. Damage to motor vehicles that could have been driven, but would have been further damaged if so driven.
  • (2) Exclusions. (Not DOT Reportable accidents)
  • (i) Damage which can be remedied temporarily at the scene of the accident without special tools or parts. (A mirror or fender can be pulled back into place.)
  • (ii) Tire disablement without other damage even if no spare tire is available. (Flat tire.)
  • (iii) Headlamp or taillight damage.
  • (iv) Damage to turn signals, horn, or windshield wipers which makes them inoperative.

Other nonreportable events would include:

  • A commercial motor vehicle becomes stuck in the median or shoulder, without contact with another vehicle. (Interpretation Question No. 12). A tow in this instance normally does not make this incident into an accident.
  • Other vehicles that leave roadway without contract from motor carrier vehicle (Interpretation Question No. 28)

Be sure to also check the DOT’s Motor Carrier Management Information System (MCMIS), which contains a Crash summary of 4 years, and individual crashes of 1-2 years (from State crash reports).

DOT Accident Summary

  • All accidents are not necessarily DOT accidents. Be sure your required DOT Accident Register reflects only those accidents which meet the criteria for DOT Accidents.
  • Where did they occur (on a highway)? Was there a fatality (within 30 days)? Was there an injury (requiring immediate treatment)? Was there a towed vehicle (due to disabling damage)?
  • Is the DOT’s MCMIS data correct for your company?
  • Have you reviewed your Company Safety Profile in the last year?

Insurance Saving Tip #48

Understanding Towing Insurance Fraud

  • The illegal towing and recovery of commercial vehicles has become an issue for some fleets.
  • Towing operations are regulated by state or local jurisdictions, so performance can vary from area to area.
  • Some jurisdictions require a separate tow bill for a trailer, thereby doubling the bill for a combination unit.
  • While most towing operators are honest, a small number has been criticized for sharp business practices, including exorbitant fees or holding equipment and cargo hostage. Prevention of towing insurance fraud is always your best defense.

One area drawing attention recently is towing insurance fraud:

  • Non-consensual towing* of vehicles without the owner’s or operator’s consent.
  • Vehicles that are towed at the direction of law enforcement without the prior consent of the vehicle’s owner or operator
  • Towing by an unauthorized tow operator
  • Unreasonable storage and access fees
  • Towing insurance fraud can directly affect your insurance premiums.

*Non-consensual towing occurs when a wrecker makes a tow without the driver’s consent, or at the direction of law enforcement, in the interest of clearing the roadway.

Tips to avoid towing insurance fraud:

  • Ensure drivers do not park a truck on private property, then leave the premises, without an authorization to park there.
  • Become familiar with the laws governing towing in the jurisdiction of the tow.
  • Follow the TMC’s recommended practices RP 527A Vendor Selection Guidelines for Towing and Recovery
  • Carefully review towing and storage bills for inflated items or services not rendered.
  • Ask the towing company to always mail you a copy of the itemized bill.
  • File a complaint with the law enforcement unit responsible for managing the rotation wrecker list, if issues cannot be resolved.
  • Is the towing company properly licensed and adequately insured?
  • Ensure drivers are on the lookout for “runners” or “chasers” showing up offering their tow services at the scene of an accident without being requested by law enforcement or any parties.
  • Make sure you have adequate tow insurance in your policy.
  • If a towing company indicates at an accident scene that they are authorized by the insurance company to be there, verify this information with the insurance company.
  • Ensure drivers know not to sign a “consent to tow” form.
  • Drivers should photograph any tow equipment involved in a tow or recovery.

2021 Insurance Saving Tip #49

Lower Your “Out-of-Service Scores” for Lower Truck Insurance Premiums

The Out-of-Service (OOS) status reflects one or more OOS violations in a single inspection, for either the vehicle or the driver, and, if any hazardous materials were present, for any hazmat violations.

  • The OOS percentage is duly noted by Underwriters

Your Out-of-Service (OOS) Scores reflect certain roadside inspection data over the last two years, based on the number of inspections.

Out of Service Score

There are five levels of DOT roadside inspections:

  • Level 1 – a complete inspection
  • Level 2 – a walk-around inspection
  • Level 3 – a driver-only inspection
  • Level 4 – an inspection for a special study
  • Level 5 – a vehicle-only inspection
  • Level 6 – Level 1 inspection plus additional examination of Radioactive Material

The OOS scores are calculated based on the following types of roadside inspections:

  • Vehicle Inspection
  • Levels 1+2+5+6
  • Driver Inspection
  • Levels 1+2+3+6
  • Hazmat Inspection
  • Levels 1+2+3+4+5+6 (when Hazmat is present)
  • The National Average % is the percentage of all inspections conducted in the USA that resulted in an “Out of Service” status.

National Average

This carrier has about 3,000 units and is well below the national averages. This is where you want to be!

  • The fewer OOS violations found on roadside inspections, the lower the OOS percentages.

Are percentages near the National Average % acceptable?

  • Short answer—Yes. Few insurance companies will expect you to be better than “average.” Slightly below is a good goal.
  • Long answer: If you are in the long game, do everything you can to keep your vehicle and driver inspections with as few OOS violations as possible for the best possible insurance premiums.

How can we improve our OOS percentages?

  • Take advantage of every opportunity to accrue “clean” roadside inspections.
  • Remember the three Fs: Find it. Fix it. But don’t Forget it.
  • Ensure drivers are always physically and medically qualified to drive a CMV (Parts 383 and 391, especially Subpart E of Part 391).
  • Vehicles must meet the inspection and maintenance standards (Parts 392, 393 and 396).
  • If you are not a hazmat hauler, make sure drivers can identify any loads containing hazardous materials, and they always check in, if they have questions on what they are hauling.
  • If you do haul hazardous materials—Follow the standards in Part 397 and U.S. Department of Transportation HM regulations Parts 171, 172, 173, 177, 178, 179 & 180.
  • Over-communicate: Keep drivers current on what they need to know.

Make sure drivers are aware of how they can be placed Out-of-Service, and what they can do to eliminate potential violations. ■