September 8, 2016

A Brief Introduction to High Risk Transportation Insurance

Before I entered the commercial trucking insurance industry, I was as naïve to the trucking world as just about anyone. I quickly immersed myself in learning the trucking industry as much, if not more, than insurance itself – ensuring that I understand the exact needs of each prospective trucking company. Whether it’s the CEO of a massive fleet operation, a driver with their own authority running twenty trucks, or an owner-operator leasing on to a major company – all of these entities are transporting goods for hire. Furthermore, any carrier has to have commercial insurance to operate, and acquiring the right coverage is not as easy as it may seem.

Each company’s insurance is unique, like a fingerprint so to speak. No company has the exact same policy or coverage, and there are many factors that go into getting these carriers covered. When underwriters analyze a risk, these influences range from the obvious, like loss history and driving records, to less known factors, like growth or the location of the business (is the company based in a metropolis?). Having an encompassing understanding of a carrier requires attention to detail to all of the above on a broker’s end. Also, access to as many markets as possible is essential to finding that match-made-in-trucking-heaven coverage.

While all of the aforementioned factors are seen and dealt with on a daily basis from an insurance broker’s side, one factor that adds an entirely different dynamic is the cargo that the carriers are hauling. Specialized haulers, or hazmat (hazardous material)/high risk carriers, are under an even more powerful microscope than common carriers.

As stereotypical and safe (excuse the bad pun) as it is to say – the economy is an ever-present component of a company’s ability to be and stay insured. While it has been a slower start to 2016, a recent analysis from the Journal of Commerce by William B. Cassidy cites a light at the end of the tunnel. He mentions the slow growth in GDP over the last 3 quarters but remains optimistic that the use of high risk trucking will drive economic activity. “Although lower private inventory investment depresses GDP, it could reflect greater consumer spending and herald an increase in shipping demand. Consumer spending rose in July for the fourth straight month…”

Not only does the market and the type of materials being hauled affect a specialized company securing coverage, but hazmat carriers will also have the entire scope of their business analyzed. The materials that they are hauling requires special warehousing and care, and the coverage is complex and is intricately quoted.

For any sort of specialized risk, attention to detail and knowledge of which markets to approach can make a huge difference in finding the right and reasonable coverage. Reliance Partners has unmatched accessibility to markets nationwide, and the internal resources (producers, customer service reps, tenured insurance professionals across the board) have helped expedite many specialized carriers getting the right insurance with the right coverage. If we can be of help to you and your company, please don’t hesitate to get in touch with us.

Gentry Smith

Director of Sales