A healthier economy is driving the transportation industry down more prosperous roads.
As consumers spend more optimistically, there has been a boom in freight demand and cargo rates. In response, truckers are upgrading to newer equipment; companies are expanding their fleets — and vehicle utilization rates have risen to above 99%. Not surprisingly, trucking companies like Old Dominion Freight Line and Knight Transportation are moving big rig sales to an 8-year high.
The owners of these new trucks and equipment will need transportation coverage. As with any policy, certain information is especially important to underwriters. There are three important questions every broker and agent should ask before taking on a new transportation client:
1. What is the experience and career longevity of the driver? Look at the driver’s CSA (Compliance, Safety & Accountability) score compiled by the U.S. Department of Transportation. The lower the score, the better the driver and your chances of landing a favorable policy.
2. Where are the drivers’ routes? In terms of risk, it’s better if a person consistently drives the same routes. These drivers tend to have safer CSA scores because of the familiarity with their work territories.
3. What is the driver’s annual mileage? Any driver that operates over 100,000 miles a year probably runs his or her truck pretty hard. If the driver has lower miles and still turns a good profit, he or she will be seen as a more favorable risk. You can get this information from the Federal Highway Administration.
Once you have your answers, consult a wholesaler – like Burns & Wilcox – with vast experience insuring the trucking industry. They can help you with everything from Public Livery and Transit Coverage to Common Transportation and Contract Transportation. Their expertise will ensure you avoid going down any wrong roads.