Commercial Vehicle Insurance

SafetyFirstAn interesting article titled “Insurance: You Can’t Avoid Risk” appears in the September 2014 issue of FleetOwner.

This article caught my attention at the second paragraph:

Crashes involving trucks and the resulting insurance claims can grab quite a chunk from the bottom line of any motor carrier [or any company operating a fleet of vehicles – SF]. According to data compiled several years ago by the Federal Motor Carrier Safety Administration (FMCSA), the cost of a crash involving one Class 8 tractor pulling a single 53-ft. trailer runs to $172,292.  If just one person gets injured in such a crash, the average cost balloons to $334,892.  And if a fatality occurs in such a crash, the average cost skyrockets to over $7.6 million.

The article also comments that insurance costs to cover premiums and out of pocket costs can be as much as 4% of the total cost of operation (TCO).

PoliceFleets looking to reduce their costs can ask for discounts and creative payment plans, but in order to materially reduce insurance expense, the only long-term solution is to earnestly work to reduce their risk of loss through aggressive and tailored crash-avoidance strategies.

Naturally, we can’t control how the general public drives on any given day, but as transportation safety professionals, fleet management teams can work with their commercial drivers, insurers, and current safety vendors to increase results.

Ideas to consider:

  1. Smash through the most common barrier to results: complacency. Many fleet teams think they’ve done all that they can and sometimes it can be hard to re-evaluate and re-tool programs to get better results.  “We’ve always done it this way” and “don’t fix what isn’t broken” are dangerous phrases if you’re sincere about enhancing risk results. It’s easy to assume that everything is working well and focus on trying “new stuff” just because it’s new and trendy, but sometimes it’s the underlying (un-sexy) tasks that are slipping through the cracks.  Be honest in evaluating what’s working and what could work better.
  2. Increase vigilance and safety awareness – just as consciously scanning the road ahead for possible hazards and motorists who may cut off trucks is critical to safe driving, management teams also have a responsibility to forecast ways to increase safety in their operations and processes.  Careful analysis of past crashes and understanding what might have contributed to them happening from a process and systems standpoint may uncover opportunities to improve your management strategy.
  3. Develop an even stronger communication strategy with drivers – not just talking at them or demanding more from them, but also learning to listen carefully to their feedback about what’s working and what’s failing to work as well as it could or should. Understanding what processes and systems keep drivers from excelling at their job and helping them with appropriate assistance could be an area to leverage.
  4. Integrate technology where it will help the most.  Technology can be applied in most fleet operations to help deliver insights into ways to increase efficiency or improve safety factors.  The trouble is that for most fleets technology can be disruptive as well. There’s a learning curve to adopting new systems and there must be vigilance in translating these data packets into meaningful management action.  If the follow up isn’t helpful to drivers or other team members, then it may not be worth the effort. One example could be adopting an online education program to refresh drivers on basic safety issues.  If the program is difficult to access, or the videos are tedious, too long, boring or poorly executed then drivers won’t pay attention or change habits.  Investing in a system that is easy to use and has interesting, short programs may be a better course of action.
  5. Actively monitor / manage your CSA scores.  While the CSA score isn’t the best indicator of operational excellence, your team shouldn’t ignore this score, either.  The Bookend BASICS have been discussed elsewhere on this blog — Unsafe Driving and Crash Rate.  When the bookends are firmly managed, the stuff in the middle tends to sort itself out, too.
  6. Don’t be shy in asking for help from your insurer.  Most insurers offer loss control support in various ways — consultants, technical bulletins, and other resources are available but only if you ask for them.  Agents can review your current policies to make sure you have appropriate coverage, and help you navigate the service offerings that come with your policy to be certain you’re getting the maximum benefit for the cost you’ve already agreed to pay.
  7. Leverage your existing safety vendor relationships. Many fleets already work with safety support vendors on issue ranging from log auditing to DQF maintenance.
    1. Are you using the most current service offering from each vendor?
    2. Are there new benefits or features that you could be using?
    3. Does your vendor offer a support network, webinars, or other meetings that could introduce new ideas or help you network with peers in order to increase safety results?
  8. Join, and participate in, a vehicle safety networking group.  Hearing about other peer’s experiences can help you save time, get to decisions more quickly and leverage other professionals learning lessons (why make the same mistake, or why not benefit if they’ve already proven something works well?)  Of course, this commitment works best when you’re an active participant – sharing with the group your own experiences.  It won’t work as well if you join and then lurk in the shadows quietly.

Managing insurance costs is important.  You want to have the right coverage for when things go wrong unexpectedly, but you also want to do whatever is practical to avoid claims or keep their costs as low as possible.

There are many safety articles at this blog site to give you more ideas on ways to prevent crashes.

Let us know what you do that works well at your fleet!

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Traffic Congestion Accelerating thru 2013

According to a recent article in Heavy Duty Trucking (click HERE), “A new report shows traffic congestion in the U.S. increased last year after two consecutive years of declines and is growing faster than the nation’s economy.”

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That report being cited is the 7th Annual Traffic Scorecard Report by a company called INRIX (click HERE).

Why is it important to know that congestion is rising?

  1. indicator of economic recovery
  2. predictor of crash rates (higher congestion should produce more fender-benders)
  3. impact on fuel, idling and lost productivity (from sitting in stalled traffic)
  4. indicator of unemployment trends (when people are unemployed, they’re not commuting to work, but when they accept new jobs much further from home, they commute longer distances in unfamiliar territories)
  5. indicator to the government planners that road capacities need to be monitored and infrastructure improved

TeleMaticsMany of the issues facing fleet operators due to congestion can be addressed through the use of an inexpensive, easy to use, plug-n-play telematics system like the one offered by SafetyFirst (the GO platform from GEOTAB).

With simple reporting, fleets can monitor and adjust their habits to conserve fuel, increase routing efficiency, avoid congestion and increase productivity.  On top of all that, the data can provide additional insights into safety especially when you blend MVR data, past crash data and How’s my driving data into a single behavior profile through our E-DriverFile system.

Have you seen increases in congestion in your area of the country?  If so, how have your operators been coping with the added delays and stress?  Is your company looking to lower fuel spend and increase safety through telematics?

Traffic Fatalities Increased In 2012

NHTSA 2012 OverviewWhile it’s tragic that deaths increased in 2012, we are glad that highway deaths over the past five years are at historic lows.  What’s strange was the sudden and unexpected rise in crash activity during the first two quarters of 2012 (the first quarter jump in activity was the largest spike in recorded NHTSA history.)

So here’s the latest from NHTSA:

  • …highway deaths increased to 33,561 in 2012, which is 1,082 more fatalities than in 2011. The majority of the increase in deaths, 72 percent, occurred in the first quarter of the year.
  • While Americans drove approximately the same amount of miles in 2012 as in the previous year, the new FARS data released today showed a 3.3 percent increase in fatalities from the previous year.
  • Fatalities in 2011 were at the lowest level since 1949 and even with this slight increase in 2012, we are still at the same level of fatalities as 1950. Early estimates on crash fatalities for the first half of 2013 indicate a decrease in deaths compared to the same timeframe in 2012.
  • Fatalities among pedestrians increased for the third consecutive year (6.4 percent increase over 2011). The data showed the large majority of pedestrian deaths occurred in urban areas, at non-intersections, at night and many involved alcohol.
  • Motorcycle rider fatalities increased for the third consecutive year (7.1 percent increase over 2011). Ten times as many riders died not wearing a helmet in states without a universal helmet law than in states with such laws.
  • Large-truck occupant fatalities increased for the third consecutive year (8.9 percent over 2011).
  • Deaths in crashes involving drunk drivers increased 4.6 percent in 2012, taking 10,322 lives compared to 9,865 in 2011. The majority of those crashes involved drivers with a blood alcohol concentration (BAC) of .15 or higher – nearly double the legal limit.
  • The number of people killed in distraction-affected crashes decreased slightly from 3,360 in 2011 to 3,328, while an estimated 421,000 people were injured, a 9 percent increase from the estimated 387,000 people injured in 2011. NHTSA is just beginning to identify distraction-related accidents, and is continuing work to improve the way it captures data to better quantify and identify potential trends in this area.
  • Nighttime seat belt use continues to be a challenge. In nighttime crashes in 2012, almost two-thirds of the people that died were unrestrained.

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NHTSA has prepared a summary of the 2012 data as a PDF which can be found HERE

Additionally, NHTSA has a preliminary look at 2013 available HERE

So if your fleet has seen an uptick in fender benders, consider a review of the many free articles offered at this blog site.  Further, if you need more specific help, call on us.

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Moose on the Loose: Increased Presence in Connecticut – News – The Litchfield County Times

Moose on the Loose: Increased Presence in Connecticut – News – The Litchfield County Times.

During the Spring and Fall, wild animal collisions tend to increase.  Larger animals tend to do cause more damage to vehicles and are more likely to lead to injuries for the occupants of the car or light duty truck since more energy is expended towards the vehicle.

The article link, above, points out that surprisingly large animals (moose in this case) can infringe on suburban areas, especially during mating seasons.

Drive carefully.

Managing Risk Thru Driver Points

For many fleets, the MVR review process is a time consuming, energy draining project done annually.  The paper produced by the project can represent great insights or merely a pile of paper. 

Progressive fleets have been working over the past decade to streamline their process by moving from spreadsheets and PDF files to “granular data” on each driver that can be sorted, sliced and diced.  This granular data of violations can be matched to a point system, and even blended with other data such as historical crash data (preventables, at-faults, or all incidents), telematics alerts, How’s My Driving reports, or other indicators.

While fleets have collected this data in the past, collating it has been an uphill battle since data layouts were not compatible, or, in some cases, difficult to get from one system to another.

Another example of a blended scoreConsider the image at right.  This driver has a lot of data and a lot of activity. 

Initially, many would simply dismiss the driver outright, but upon closer examination, you can see some interesting patterns in the data. 

From 2005 to 2010, there are five speeding events in five years (although three occured in 2008).  In 2011, there were two motorist complaints about driving too fast, dishonoring the right of way and failure to stay in lane.  The next event to occur was a crash in August of 2011 when the driver hit another vehicle in the rear. 

Another crash happened in January 2012 (and was cited for careless driving on same date), then another complaint about lane change, signals and driving too fast for conditions in June of 2012. 

Management had indicators that this driver tends to rush. 

  • Was there any direct observation of the driver to determine whether they allow proper following distance? 
  • Was there remedial training provided and completed? 

The system that produced this report can be expanded to show the remediation events (and, in theory could provide negative points for successful training, etc.)

At issue isn’t just one particular driver, but locating those drivers who are most likely to be involved in collisions based on patterns of behavior, or who’ve had one crash already and may be ready to have a subsequent crash.

The National Association of Fleet Administrators (NAFA) recently posted the following video about driver point systems:

SafetyFirst’s E-DriverFile program has been ordering and processing these reports for years for clients with as few as 40 drivers and as many as 7,500 drivers. The system does much more than report on these metrics and can even help those fleets who are regulated by FMCSR.

How does your organization handle MVR point systems?  Do you have a database program?  Is it largely manual?  Can it automatically order fresh MVRs on higher than average risk drivers quarterly?  Would you save time if all this data was in a single spot?

Can we show you how our program works for larger, multiple location fleets?

Hubris: the Hidden Hazard in Commercial Auto Safety Programming?

We’ve been blessed with radically and rapidly declining road-related fatalities for the past two reporting cycles (i.e. CY2008 and CY2009) with indications of further advances in CY2010.

However, as the manufacturing base revives from two years of decline, and the construction segment begins to retool itself, more commercial vehicles are back on the road.

Organizations that have become complacent with strong fleet safety results despite budget cutbacks, curtailment of training programs and elimination of safety staffers may face a growing rate of collisions over the next 18 months.

An examination of recent headline collisions, industry “buzz” (about CSA / driver shortages / increasing freight / et.al.), regulatory and case-law activity suggests that the greatest challenge found in driver safety is battling overconfidence and false presumptions about the reduced fatality rates (while crash rates have not declined at the same rate).

Some safety managers that I’ve spoken to (not our clients!) have thrown out statements like “we’ve been doing great so we don’t need more safety programming right now” or “we just installed “product X” so we’re not looking to invest in anything else for our driver safety program — we’re confident that putting “product X” in place will cover us” (i.e. all our eggs are in one basket, and that’s OK)

Additionally, when you closely examine some of the current “headline grabbing” collisions, the commentary suggests that either drivers and/or their managers have become “dulled” to their safety responsibilities (ie. they’re going through the needed motions, but their “collective mind/spirit” isn’t engaging).

What do you think? Am I far off the mark or is there adequate credibility to my assertions that the lowered crash rates were driven mainly by the sluggish economy, and that a certain “overconfidence” in safety mindset could bite some fleets in the rump once the economy ‘heats up’?

Are Collisions by Chance or by Choice?

PoliceOutside my office window is a three-lane, divided highway with service road access. The county police constantly run a ticket sweep for people entering the service road without stopping. Two police officers can “work” two cars each on a continual basis through their shift. The county police always set up in the same, exact spot, and always mid-week. Despite their predictability, they never fail to catch a bunch of motorists (and commercial drivers, too).

People rolling through the stop sign come in two types: compliant “give me the ticket” types and ones who argue. Both consistently get tickets – arguing simply slows down the process.

This behavior (rolling through stop signs) represents a choice, whether the police are present on that day is a chance occurrence. Texting while driving represents a choice, plowing into the back of a stopped truck while texting (an unfortunate, but likely outcome) is a chance occurrence – many texters justify their choice by the fact that they haven’t been in the wrong place at the wrong time – yet.

redlight cam pictureThere are a lot of “choice not chance” behaviors in traffic safety: drinking and driving; youth drivers with a boatload of friends “egging them on” to drive like an idiot; aggressive driving – letting your emotions control your driving to the point of recklessness; driving while in-text-icated or YWD “Yakking While Driving”; speeding; tailgating; failure to use signals; passing with inadequate clearance; running “yellow-orange-red” lights at intersections, and much more.

It got me thinking about the “causes” of collisions. We know that the driver’s action, attitude, and choices are strong contributor factors in 90% (or more) of the collisions reported annually. However, I don’t think I know anyone who’d be willing to argue that drivers choose to be involved in a collision. At the same time, I don’t think they would defend the idea that collisions happen by pure chance, either.

In a manufacturing plant, we don’t have this discussion. Either the machine malfunctioned, was set up incorrectly, or the injured employee failed to follow a procedure. A much more “binary” solution – it had to be X or Y – there’s no range of possible explanations. Why is it (apparently) different on the highway?

I’ve heard a few safety managers use the phrase “it was outside the driver’s control” offered to defend the driver’s involvement in the collision. What could be outside the driver’s control? I’d be willing to consider items like: internal (invisible) defects in a tire that led to a blow out, sudden mechanical failure of an axle or steering linkage, invisible “black ice”, things happening beyond the driver’s sight line (around the corner, hidden by a view block). But we know from experience and statistics that these don’t account for too many collisions. Most are avoidable and preventable.

I think that the “outside the driver’s control” issue could be better expressed this way: the driver chose certain behaviors and chance intervened to make conditions perfect for a tragic outcome. Had conditions (chance) been different that day, the “bad” choices wouldn’t have led to a crash; therefore, it was chance’s fault, not the driver’s.

A colleague sent me a link to this video http://www.youtube.com/watch?v=dNYLEEQQzdE&feature=channel. The message offered by the police officer is that the drunk driver made a choice to get in her car and drive while impaired. The collision that killed the officer’s mother wasn’t a chance occurrence – it was completely preventable because the collision was from a choice that had been made earlier in the evening.

Traffic safety is EVERY driver’s responsibility. A wise person would choose to learn from past mistakes and improve their performance after receiving coaching from an advisor (we reduce the chance of a collision by choosing to drive correctly).

We need to be held responsible for our own choices, and we need to learn to make better choices regardless of how “lucky” we’ve been in the past.

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