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17 Jun

By

Safety Programming Free of Charge!

June 17, 2009 | By |

It often surprises me that while the insurance companies we represent each offer comprehensive safety programming to their clients, few take advantage of the tools available.  There is no additional cost for this programming and for a small company it is almost like having a safety director at your immediate disposal. 

 

For those of you who may not realize, below is an outline of some of the commonly offered safety programs, materials and services available through the majority of insurance companies who specialize in trucking:

 

Driver File Reviews:  At your request a safety rep will stop out to your office to review your drivers’ files to make certain they are compliant.  Some companies even offer printed guides to help you set up driver files correctly from the start and answer frequently asked questions.


DOT Audit Reviews:  Similar to a driver file review, safety reps can also review your files prior to an anticipated DOT audit, or any other time, to make certain you are compliant and point out any potential issues. 

 

Samples of and Recommendations for Formal Safety Programs:  Safety reps love to help in the development of a formal safety program.  They can outline the policies that are ideally included in a formal program and suggest specific verbiage or places to obtain verbiage to get you started in the process.

 

Driver Recognition Programs:  Looking for a way to recognize your drivers for their outstanding service?  Driver recognition programs are a great (and low cost) option.  Many insurance companies offer certificates or give away items free of charge which may be used as acknowledgement of outstanding performance.  Your safety rep can also suggest a basis for your driver recognition program.  Examples include highest number of loss free miles, outstanding customer relations, best DOT inspection record and so forth. 

 

Loss Control Consultation:  Many companies will review your loss history to see if preventable patterns of loss can be identified, which will allow you to complete appropriate driver retraining.  These consultations can be conducted either on site or through information gathered by fax or email. 

 

Answers to Safety and Compliance Questions:  Safety reps gladly make themselves available by phone to answer questions that arise regarding safety and compliance.  Examples include compliance laws for operating in specific states or Canada, how to address DOT safety ratings on Safer and understanding new legislation relating to hours of service. 

 

Safety Meetings:  Would you like help planning a formal safety meeting?  How about having a speaker the next time you meet with drivers?  Most safety reps are willing to come out for a formal meeting and speak to your drivers for no cost.  They are also willing to help facilitate a meeting or plan topics for discussion.  


Safety Training Videos:  Most insurance companies offer for loan a wide selection of VHS tapes, DVDs and CDs addressing safety topics.  The only cost to you is the postage to return the video when you are done.  For a complete listing of videos available to you, just call your Account Executive or your safety rep.

 

Printed Safety Materials:  Printed materials are available for a wide range of topics, including: tips for reducing work comp claims, safety posters, instructions on completing pre-trip inspections, post-accident drug/alcohol testing procedures, completing daily driver logs and information regarding hazmat regulations, training and security plan development.

 

All of us at the Navigator Truck Insurance Agency work hard at being accessible, helpful and result oriented.  Don’t see something you’d like help with?  Give us a call (800) 596-TRUCK (8782).  We’d be happy to see if what you are looking for is available.

 

Until next month,

 

Jeffery A. Moss, ARM

President

 

 

15 May

By

The Secret to a Great Deal

May 15, 2009 | By |

At least once each quarter I speak with a client who says they received a proposal from another agent and that the premium is just too good to be true!  In many cases, this leads the client to have concerns whether their coverages are adequate and I am asked to review the proposal to see what kind of coverage they’ve been quoted.  What I often find are large coverage gaps that the client didn’t realize existed. 

 

This month I’d like to reveal some of the common coverage weakness that I come across and what impact these missing coverages might have in the event of a claim:

 

Lower Auto Liability Limits:  While it is true that $750,000 is the limit you are required to carry by the FMCSA, most contracts and shippers will require a certificate of insurance showing a $1,000,000 limit.  In many cases a $750,000 limit is not going to reduce your premium significantly, but could cost you business, time and additional money later when you need to amend coverages midterm.

 

Coordination of Benefits:  Some agents will ask you about your health insurance, workers compensation and occupational accident policies when quoting your liability insurance.  One reason is that they may be coordinating your benefits.  That means that in the event that you are injured in an accident, your health insurance, workers’ compensation or occupational accident policies will respond first.  While it may be preferable for your workers’ compensation or occupational accident policies to pay for your injuries, it is normally advisable not to coordinate your health insurance with your auto insurance.  The primary reason for this is that health insurance policies often have lifetime limits.  So, in the event that your health insurance’s lifetime benefit limit is $750,000 and you are badly injured in an accident, incurring $650,000 in medical bills, this leaves only $100,000 left on your health insurance policy.  What would happen if three months after you have recuperated from your accident you learn that you have been diagnosed with cancer?  You will likely wish you had all $750,000 available to you, rather than just the remaining $100,000.

 

No Hired and Non-Owned Auto Liability: Some agents will leave this coverage off in order to reduce premium.  However, not having Non-Owned Auto Liability can be dangerous, as it leaves you open to law suits in the event that an individual in their own car is involved in an accident while working for you (i.e. performing a company errand.)  It may be argued that because the driver would not have been on the road had they not been completing the errand, it is your responsibility to pay for the auto liability they caused.  Non-owned Auto Liability coverage is a very low cost option to insure yourself against such unforeseeable events.  Hired Auto Liability, on the other hand, will provide you with Auto Liability for tractors that you have borrowed or short term rented.  The cost for this coverage is significantly less than if you purchase it from the truck rental company and including on the policy from the beginning means you won’t be running around at the last moment trying to secure coverage.

 

Swapping Comprehensive Physical Damage for Specified Perils:  Check to make certain that your Physical Damage policy includes Comprehensive coverage, as opposed to Specified Perils.  Comprehensive will cover you for any sort of Physical Damage claim (other than collision), while Specified Perils will only cover you for those that are named in the policy.  There can be a number of unforeseeable losses, such as vandalism, that you may wish to be insured for.  Specified Perils may be less premium than Comprehensive, but the coverage is also significantly reduced.

 

No Broad Form Collision:  In the State of Michigan we are subject to no fault laws.  The downside to this law is that if another person is at fault in a collision, you do not have the right to pursue damages by taking that person to court.  Instead, your physical damage policy is used to repair your vehicle.  Broad Form Collision seeks to limit the amount you have to pay in the event that you are not at fault for a collision, as your deductible for repair will be waived.  If you have a physical damage policy with Standard Collision, you have to pay your deductible regardless of who was at fault.

 

No Hired Physical Damage Coverage:  Hired Physical Damage is a nice feature to have on a policy, as it will make certain you have coverage up to a specified amount for any tractors or trailers that you have rented for a short period of time (usually 31 days or less).  Again, in most cases, the cost for this coverage is significantly less than what you would pay if you bought it through the equipment rental company. 

 

Co-Insurance Clauses:  While co-insurance might not make your premium less, it is often the byproduct of a discounted policy premium.  Be careful to investigate any hidden clauses on the Cargo or Physical Damage policies.  Ask your agent specifically whether or not co-insurance applies, or if there are higher deductibles for losses caused by theft or refrigeration breakdown. 

 

No or Limited Towing Coverage:  The cost to tow a tractor and/or trailer from the scene of an accident can easily exceed $10,000.  While most policies will include some sort of towing coverage, it is not always clear how much.  When reviewing a proposal ask about towing limits.  Many policies cap payments on towing at $3,000 to $5,000.  And remember, there is no towing coverage if you do not purchase Physical Damage.

 

Few or No Physical Damage Enhancements:  These are the optional coverages that we often find clients want or expect in their policies, but do not realize must be listed on the policy.  Under this heading falls coverages for things such as rental reimbursement and downtime coverage, tarps/chains/binders, personal effects, diminishing deductibles and emergency family travel.  In many cases the cost for such enhancements is minimal. 

 

No General Liability: General Liability is an optional coverage that indemnifies you in the event that your company is liable for bodily injury or property damage to a third party.  This is for occurrences away from the tractor.  One feature of having a General Liability policy is that it automatically includes legal representation in the event that someone brings a suit against you (the premium is significantly less than it would cost to hire and retain an attorney.)  Also, General Liability coverage is frequently required in contracts or by shippers before the trucking company is allowed on the shipper’s premises. 

 

Misidentifying Radius of Operations:  Unfortunately from time to time we do see radius of operations misrepresented on a proposal.  An example of this is when an insurance company restricts the number of times per year you can exceed a predefined radius (normally 300 or 500 miles.)  If you routinely travel outside of the radius you have been rated for it is considered falsification of information on the applications and is grounds for midterm rate increases, cancellation of policy or even rejection of claims.

 

All of us at the Navigator Truck Insurance Agency work hard at being accessible, helpful and result oriented.  Need help understanding your “great deal”?  Give us a call at (800) 596-TRUCK (8782).  We’d be happy to help you out any way we can.  

 

Until next month,

 

Jeffery A. Moss, ARM

President

 

15 Apr

By

The Secret to Insurance

April 15, 2009 | By |

I am frequently asked what the secret to insurance is.  In other words, how can a client get his best insurance rate?  In my years of insurance experience I have seen many prospective clients head down the paths they think will lead them to their best rate, only to have it turn out just the opposite.  This month I thought I’d offer up some tips on what may make your trucking company a more appealing risk to the insurance company and to dispel some myths about what will increase your rates:

 

Experience:  Insurance companies like the comfort of knowing that the trucking company owner has previous experience in the industry before starting his own company.  Most insurance companies prefer prospective clients who have been in business, and profitable, for at least 2 years.  For new ventures, preferred companies will have owners with multiple years of experience as Owner Operators first.

 

Drivers:  Drivers are near the top of criteria that an Underwriter will review.  Preferred clients will have drivers with multiple years (five or more) of experience driving the same type of equipment the trucking company operates.  In addition it is desirable for a company to have very low driver turn over, not to utilize “finishing programs” for new hires, and for their drivers to have few, if any, moving violations, within the last 3 years. 

 

Safety:  Also high up on an Underwriter’s review is management’s attitude toward safety.  Less easy to define, management’s attitude toward safety is often demonstrated through the existence of a complete safety program that is not only reviewed with the drivers, but is the standard to which driver’s are held.  Regular safety meetings on relevant topics and safety incentive and award programs for drivers also demonstrate how committed to safety a company may be.

 

Routes:  While the nature of the trucking industry makes this one difficult to obtain, Underwriters have a preference for company’s who have regular, known routes hauling commodities that they have had extensive experience with.  In addition, long term profitable contracts with the same core group of shippers also appeal to most insurance companies.

 

Losses: Of course this is the one I am asked most frequently of all.  “How will this claim affect my premium?”  The answer is complex.  Insurance companies expect losses; that is why they are in business. However, they prefer clients who have losses that are infrequent, unpreventable and non-routine in nature.  Some examples of loss experience that might impact a company’s premium are if the Underwriter is able to see a pattern to a company’s losses, the losses are minor but frequent in nature, there is a specific driver responsible for the majority of the losses, but no disciplinary action taken or there are a number of high dollar and preventable claims. 

 

Controlled Growth:  Insurance companies prefer clients who have demonstrated stable and controlled growth.  Newer ventures that have grown from one truck to ten in a three month period can throw a red flag up for an Underwriter, as he or she will begin to wonder if management has enough safety policies and procedures in place to manage the growth well.  Often times trucking companies think that the more equipment they have the more “buying power” they yield.  This may be true for a company that has been in business and profitable for 5 or 10 years, but is not the case for a company that has been in business for 1 year and has already had multiple claims.

 

It is important to note that the items above are not all that an Underwriter will take into consideration while reviewing your account, but they are some of the big items I am frequently asked about.  If we can help you to understand your company’s snapshot, give us a call at (800) 596-TRUCK (8782).  We’d be happy to help you out any way we can.  All of us at the Navigator Truck Insurance Agency work hard at being accessible, helpful and result oriented. 

 

Until next month,

 

Jeffery A. Moss, ARM

President

 

15 Mar

By

Insuring Your Home Away from Home

March 15, 2009 | By |

Life on the road is hard. . . long hours and days away from family and friends.  It’s no wonder that many truck drivers these days try to duplicate some of the comforts of home in their truck.  And it goes well beyond staples such as clothing and food.  It is now common for a long haul trucker to carry his laptop, portable printer, television and DVD player in the tractor with him.

But what happens in the event that your tractor is stolen or involved in a serious loss that also damages such personal possessions?  Can you make a claim on your truck insurance policy or do you have to chalk it up to a loss?  The good news is that there are a number of ways to insure such possessions in the event of theft or damage. 

Many insurance companies now offer endorsements to add Personal Contents coverage.  Personal Contents coverage provides limits up to a specified amount (usually in the ballpark of $2,500) for a driver’s personal possessions.  These endorsements will require the insured to pay a small deductible (such as $250) on any claims paid. 

Another option is to purchase an Inland Marine policy.  This policy can be purchased separately from the Physical Damage policy (which means you can buy it even if you choose not to carry Physical Damage on your truck.)  The coverage will follow your property everywhere it goes and also requires a deductible to be paid per covered loss.  Deductibles normally range somewhere between $250 and $1,000.  Benefits of the Inland Marine policy include the ability to schedule the items you are insuring and being able to purchase higher limits than what are available on the Personal Contents endorsement available through a Physical Damage policy.  Also, claims made on the Inland Marine policy do not show up on the Physical Damage loss history, which is nice in the event that you experience a theft of your personal contents, without having damage to the truck.

One final option that we often see overlooked is to endorse a coverage for your personal belongings in your truck to your Homeowners or Renters policy.  That can work, too. 

As with all policies, you will want to carefully consider the terms, conditions, exclusions and cost of these options before making a final decision.  If we can help, give us a call at (800) 596-TRUCK (8782).  We’d be happy to help you out any way we can.  All of us at the Navigator Truck Insurance Agency work hard at being accessible, helpful and result oriented. 

Until next month,

Jeffery A. Moss, ARM

President

 

15 Feb

By

Planning for the Additional Expense of a Loss

February 15, 2009 | By |

Let’s face it. . . . a loss to your truck is expensive.  Not only do you have the expense to tow and repair your truck (which in most cases will be covered by your Physical Damage policy), but there are also the additional unanticipated expenses, such as downtime or the cost to rent a replacement truck.  It can be hard to know in advance what the exact amount of this expense will be . . . you can never foresee how long you’ll be “down.”  But did you know that in many cases there are endorsements available that may help reduce your expense?

 

These endorsements are commonly referred to as Rental Reimbursement or Downtime Coverage and are added to your Physical Damage policy.  Rental Reimbursement or Downtime Coverage is not available unless you have also purchased a Physical Damage policy and in some cases, the insurance company may not even offer these endorsements at all. 

 

While there are differences between these two endorsements, the theory behind both is similar.  The purpose of Rental Reimbursement or Downtime Coverage is to reimburse you a specific dollar amount per day for a specified number of days while your truck is being repaired.  Some insurance companies will include the Rental Reimbursement or Downtime Coverage endorsements as a standard part of the Physical Damage policy form, while others will charge an additional premium for this coverage.  Limits range by company, often times falling somewhere between $65 – $150 per day for 15-45 days.

 

Some things to keep in mind when considering these coverages include:

1.)    Is there any coverage provide in your Physical Damage policy at no additional cost to me?

2.)    What is the daily reimbursement limit?  Is this enough to off set the cost to rent a replacement tractor?  Are higher limits available?

3.)    How many days of reimbursement will the insurance company provide?  Does this seem adequate?  If not, are additional days available?

4.)    For Downtime Coverage, do you need to demonstrate a loss of income?  Will you receive the full amount of reimbursement even if your daily income is shown to be less than that amount?

5.)    For Rental Reimbursement, what if a replacement vehicle isn’t available or you borrow a friend’s truck?  Will you still receive the Rental Reimbursement?

6.)    Will you need to provide receipts demonstrating the cost of your replacement?

7.)    What is the cost of the endorsement?

 

All of us at the Navigator Truck Insurance Agency work hard at being accessible, helpful and result oriented.  Need help understanding this coverage or any other?  Give us a call (800) 596-TRUCK (8782).  We’d be happy to help you out any way we can. 

 

Until next month,

 

Jeffery A. Moss, ARM
President

 

 

28 Jan

By

The Unexpected Burn of Co-Insurance

January 28, 2009 | By |

I have recently been encountering more instances where prospective clients have been burned by a Co-Insurance clause on their Physical Damage or Cargo policies.  Co-Insurance can be a confusing thing to navigate and requires special attention to policy limits and the actual cash values of equipment and cargo than policies without Co-Insurance. 

 

What is Co-Insurance?

It should first be explained exactly what Co-Insurance is.  Co-Insurance is a device used by insurance companies to encourage policyholders to insure their property (i.e. tractor, trailer, cargo, building or contents) for amounts which are close or equal to the actual cash value of the property.  In essence you are penalized if you do not carry “adequate limits.”  Normally, an “adequate limit” is defined by the insurance company as somewhere between 80% and 100% of the actual cash value of the property (depending upon the policy verbiage.)  If you do not carry the “adequate limit,” the insurance carrier will reduce your claim settlement in the event of a partial loss.  Co-insurance does not apply to total losses.

 

How does it work?

Let’s use an example where a Physical Damage policy has an 80% Co-Insurance requirement.  The actual cash value of the tractor in question is $100,000.  The insured has it listed as $75,000 on his policy.  Under the Co-Insurance clause, he would have needed to schedule it for a minimum of $80,000 in order for the Co-Insurance clause not to apply.

 

The tractor is involved in a covered loss that causes damage, but doesn’t total the tractor, and now the claims adjustor is determining how much to pay the insured.  In this case he would take the amount of insurance the insured DID carry ($75,000) and divide it by what he SHOULD have carried ($80,000.)  This factor (.9375) is now applied to the amount to be paid to he insured.  Let’s assume that the damage totaled $50,000.  This means that the amount paid would be $50,000 x .9375 less the deductible.  So in this case, instead of receiving $50,000 less the deductible, the insured will receive $46,875 less the deductible.  And there’s the burn.  The client ends up “self-insuring” an additional $3,125.


Do your Physical Damage or Cargo policies carry a Co-Insurance clause?  Not sure where to look to find out?  Give us a call at (800) 596-TRUCK (8782.)  Often times we can tell you without even looking at the policy verbiage if the insurance carrier has a Co-Insurance clause.  In those cases where we can’t, a quick review of your policy will tell us for certain.  Don’t get caught off guard.

 

Until next month,

 

Jeffery A. Moss, ARM

President

23 Dec

By

General Liability – Do Not Go Without!

December 23, 2008 | By |

In reviewing my email inbox this morning I came across the following article that was written by Jim Hannon, Underwriting Manager for the Southern Region of Great West Casualty Company.  I thought the article was so good that I wanted to share it with you all.  It reads, in part. . .

 

“Buying a truckers policy will typically satisfy the requirement for those activities related to driving around in a truck; but that is not where the truckers responsibility ends!  Adding to this government-dictated policy is the adult responsibility of protecting property, one’s lifestyle, and those of any employees.

 

It is widely know that anyone can sue anyone over anything; one of life’s harsh realities.  The following scenarios highlight some activities that might prove fertile ground for a suit to grow:

 

● A visitor has a slip and fall accident at a trucking company’s premises breaking a hip bone, becoming partially disabled and causing lost wages.

 

● A truck driver throws a cigarette in a trash can that starts a fire causing $100,000 of damage to his landlord’s building.

 

● A truck driver makes a disparaging remark about a competitor, causing the competitor to lose a valuable contract and forcing them to sell equipment.

 

● While using a forklift, the trucking company’s employee steps on the gas instead of the brake and fatally injures a shipper’s employee. 

 

● After a truck driver repairs an owner-operator’s tractor brakes, they fail, and the resulting accident causes major damage to the unit and the local Burger Boy restaurant.

 

● A gasoline hauler misdelivers diesel into the “87” octane tanks at the Four Corners Fuel Stop, resulting in engine damage to 59 of their customers’ autos.

 

Someone must pay for the damages suffered by these innocent people.  Will you be paying from your pocket because you have taken the risk of going bare, with the potential for bankruptcy or will you have purchased General Liability coverage to handle these situations?”

 

The stories in which actions led to unintended consequences which led to a suit can go on and on.  Don’t get caught without this vital coverage in your time of need.  Give us at The Navigator Truck Insurance Agency a call today at (800) 596-TRUCK (8782).  Together we will review your current insurance program and determine if coverages such as General Liability, are missing. 

 

Until next month, wishing you and yours a very Merry Christmas and a Happy New Year!

 

Jeffery A. Moss

President

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

14 Nov

By

Total Loss? Ouch!

November 14, 2008 | By |

A while back we had a client who experienced something that we in the industry call a “Constructive Total Loss.”  For him, it was a very painful experience, one that I think we can all learn from. 

 

What is a “Constructive Total Loss?”  A CTL is a loss where the item insured is not totally destroyed, but is so severely damaged that the insurance company considers it uneconomical to repair.  A CTL in and of itself is not particularly painful, but if you happen to have undervalued your equipment, purchased a stated amount physical damage policy (which the majority of policies are) and been involved in an accident that damages your equipment at 50% or more of the amount stated on the policy, you may feel you got burned.

 

Here’s what happened to our client:

 

Tom purchased a “lead” and a “pup” flatbed trailer to be pulled as doubles.  The “lead” was purchased for $40,000 and the “pup” for $45,000.  Tom figured he could repair almost anything that could happen to these trailers if they were involved in an accident, so he decided to insure them on a stated amount policy for $15,000 each.  His assumption was that this would reduce his physical damage premium and that in the event of a claim, if the insurance company paid him $15,000 for each of them, he would be able to use that money to repair any damage that might occur. 

 

On a snowy, icy day Tom lost control and rolled his rig.  The result was $12,000 in damage to the “lead” trailer (80% of the value he insured for) and $9,500 to the “pup” (63% of the value insured for.)  Tom thought everything was going to be ok, until the Claims Adjuster called him and told him that he was going to “total-out” the two trailers and would be sending Tom a check for $30,000 and, per the policy conditions, the insurance company would be taking possession of the totaled vehicles.  Tom quickly realized that while he had $30,000 in his pocket, he had nothing to repair and an additional $55,000 in outstanding loans for the equipment!

 

There are two important lessons that Tom learned.  The first is that there is no savings in underinsuring your equipment.  To have insured these trailers up to their full value would have likely cost less than and additional $1,500 a year (much less than the ultimate hit of $55,000.)  Additionally, Gap Coverage (which I discussed in last month’s posting) is a coverage that can be vital to protecting yourself financially from unforeseen catastrophic losses.

 

What would happen in the event of a loss that did a significant amount of damage to your equipment?  Would you be content with your settlement in the event of a CTL or is it time to make some revisions?  Give us a call today and we can discuss with you the best methods to insure yourself so you don’t get burned by a Constructive Total Loss.

 

Until next month,

 

Jeffery A. Moss

President

15 Oct

By

Gap Coverage

October 15, 2008 | By |

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In my dealings with clients and prospective clients I am frequently asked how in today’s market, with equipment values depreciating faster than loan balances, a person can guarantee their insurance will payoff the balance of the loan in the event of a total loss?

The answer is gap coverage.

Gap coverage provides additional coverage in excess of the actual cash value of your tractor or trailer, increasing the limit to be equal to the payoff amount of the loan at the time of loss.

These days, many companies make gap coverage available to their clients for a minimal premium, while others even offer it as a standard feature of their physical damage policy. And, this is a coverage that can be added to your policy in the middle of the policy period.

Take a quick look at your loan balance today and see how it compares to the actual cash value of your truck as of today’s date. If the loan balance exceeds your actual cash value, gap coverage is something you owe it to yourself to investigate. When you are ready, give us at a call at (800) 596-TRUCK (8782.) We will review your policy and assist you in putting your gap coverage in place!

Until next month,

Jeffery A. Moss
President

08 Sep

By

Blog Launched

September 8, 2008 | By |

Welcome to the Official Blog of the Navigator Truck Insurance Agency. We will be up and running in no time at all! Come back to see how our Blog changes during this week.