Challenges in Obtaining Affordable Trucking Insurance
Figuring out the nuances of trucking insurance can be a complicated process.
Obtaining affordable trucking insurance can be challenging for many trucking companies due to the high-risk nature of the industry and other factors. However, ELD for trucking, proper training, compliance, and other things that garner trust can help truckers find more affordable insurance. All insurance companies assess risks when determining premiums, and if your company has properly implemented safety measures, then you will be provided with better offers. Here are some challenges in obtaining affordable trucking insurance and how to get it.
The high-risk nature of the industry
The trucking industry is associated with various risks such as accidents, cargo damage or theft, and liability claims. If a company engages in high-risk tasks, such as hazardous materials transportation or long-haul routes, the insurance premiums will inevitably be higher.
This is because insurance companies analyze all the risks before handing out insurance premiums. Implementing rigorous safety protocols can help businesses access better insurance offers.
Driving records and safety history
Your company’s safety history and driving records also play a part in determining premiums. If some of your drivers were involved in accidents, claims, or violations, then the insurance costs will be higher. Therefore, companies should implement protocols and technologies that help them become more compliant, such as ELD devices, ADAS, telematics, and others.
You should also invest in driver training programs by using the data collected from these devices and address potential driver behavior issues. Inexperienced drivers are seen as high-risk, so a trucking company should focus on retaining their experienced drivers and training new ones. This will also play a role in better insurance offers as fewer risks are likely to occur when experienced and well-trained drivers are working for a company.
Type of cargo and specialized operations
The type of cargo you transport will affect your insurance premiums. For example, high-value or hazardous cargo that is to be transported through densely populated areas can result in higher insurance premiums.
This can also be the case regarding specialized operations such as oversized or overweight loads, which may require further coverage.
Geographical coverage, risk management, and market conditions
Both a trucking company’s geographical coverage and operating area will affect its insurance costs, as some areas have greater risks than others. For example, a region may have higher accident or theft rates, challenging terrain, or adverse weather conditions.
A company’s safety programs and risk management practices are also carefully analyzed by insurance companies before handing out premiums. Only trucking companies that have the following programs will receive better insurance offers: Driver training initiatives; robust safety programs; and risk mitigation strategies
Lastly, the overall market conditions and factors within the industry can also impact premium rates. If, for example, there is a period of frequent claims, insurance companies may raise their premiums across the board. Even if truck accidents aren’t more frequent, catastrophic accidents, especially if they gain widespread media attention, can also influence insurance premiums. Economic factors also play a role in insurance rates, such as rising medical costs.
