How Your Trucking Insurance Rates May Be Impacted By New Laws
Changes in regulations are quite common for the trucking industry especially because such new laws are being introduced to promote road safety, environmental protection, and accountability within the industry. Though these efforts are focused on improving the efficiency and safety of the transport system, regulations often have economic consequences which can be particularly challenging when looking at trucking insurance rates. Here’s how the new trucking laws may benefit or worsen your costs with insurance. truck insurance brokers by Integrity Insurance
The Cost of Insurance Will Change With New Rules On Safety Compliance Costs
The new more stringent proposals that enlist the use of Advanced Driver Assistance Systems (ADAS), Electronic Logging Devices (ELDs), and more rigid Hours of Service (HOS) regulations set in place will definitely alter the risk cost. For example, safety practices already in place will offer value to the trucking firm with reduced premium rates fees while those who do not actively pass the safety regulations face hikes in their insurance fees and even policy terminations.
New Minimums on Insurance is Requirement
Certain states, along with some federal agencies are advocating for more minimum liability insurance to be set for commercial truck drivers. A while back, the liability coverage limit for interstate trucking companies was set to $750,000. New proposals are looking to increase that amount. While higher coverage limits do enable more financial protection during accidents, the downside would be that insurance costs will also rise for trucking companies, especially the smaller ones.
Expansion of Use of Telematics Along With Monitoring From Insurers
New laws that advocate and encourage the use of telematics such as GPS tracking, dashcams, and real-time diagnostics of the vehicle are helpful in allowing insurers to monitor driver behavior more accurately. With these devices, auto insurers can adjust premiums based on the information. Safe drivers will be rewarded by lower claims while aggressive behaviors like rapid deceleration, overspeeding, and excessive throttling will be penalized.
Effect of Environment Regulation Policies
More effectiveness laws are forcing trucking companies to switch towards hybrid and electric vehicles along with cleaner fuel technologies. Although these laws are mainly focused on the reduction of carbon emissions from this industry, they influence the rate of insurance in the business. Insurance on new technology vehicles tends to have higher premiums. However, fleets that deployed environmentally friendly trucks will have to bear the lower premiums provided by the friendly insurers or even the green grants from the state.
Changes to Worker Classification and Liability
Recent developments in the law might affect the classification of truck drivers, such as zoning in California through AB5, which has the potential of changing insurance rates. For instance, if independent contractors are classified as employees, then trucking companies would have to pay for additional coverage like worker’s compensation, and such changes would make insurance coverage more expensive overall. On top of that, changes to liability laws might expand the potential exposure to being sued and that will have an effect on premium payment levels.
How Insurance Expenses Can Be Controlled by the Trucking Companies
In terms of controlling expenses within their trucking business, companies can consider the following proactive steps:
Improving existing driver training curriculum in relation to accident mitigation.
Purchasing addressable telematics systems for behavioral improvement.
Compliance to new safety and emission regulations.
Using comparison sites to obtain the best competitive quotes.
Changing the premium to a higher deductible.
Closing Statement
The changes within the trucking industry will affect the insurance sphere, positively or negatively. For some, insurance coverage may be costly due to overcompensating regulations while businesses that focus on proper safety, effective compliance, and efficiency are likely to get better deals. It is crucial for these companies to follow legislative changes along with working closely with savvy insurance brokers to overcome the challenges easily.
