January 31, 2024

Proactive Measures in Insurance Renewals: A Cost-Saving Strategy

In the trucking industry, where insurance has been a pressing issue, especially with the surge in nuclear verdicts amidst a freight recession, a strategic approach to insurance renewals is not just beneficial, but essential. At Reliance Partners, we understand that the landscape is challenging, but also that proactive measures can significantly influence insurance premiums in a positive way, without compromising on coverage quality.

Our Executive Vice President of Sales, Jackson Alexander, emphasizes the importance of comprehending the underwriters’ perspective to adeptly navigate through the renewal process. Insurance rates are initially computed through algorithms specific to each provider and are not final. Underwriters have the flexibility to adjust these rates by up to 50%, based on the state. This is where proactive safety measures and collaborating with proficient insurance agents become crucial. A well-presented, evidence-supported case by an agent can lead to notable savings on insurance rates.

Insurance providers weigh various factors differently when determining rates. Some may prioritize driver retention, while others may be more lenient towards high turnover rates. Expert agents, like Alexander, are well-versed in these nuances, enabling them to pair each fleet with the most suitable insurance provider.

Certain factors universally impact insurance rates more significantly:

  1. Loss History: A fleet’s past accidents and violations are pivotal in assessing its risk profile. Alexander points out, “The past is indicative of the future. A history of frequent accidents suggests a similar trend moving forward.” Hence, fleets with robust safety and compliance records are more likely to secure favorable rates.
  2. Business Tenure: Newer trucking companies often face higher insurance rates compared to established ones. This is attributed to the lack of long-term data to negotiate competitive deals. However, rates tend to improve as newer companies build their operational history with safe practices.
  3. CSA Scores: CSA scores are crucial in determining a trucking company’s insurance rates, given their universal acceptance as a safety measure. Insurance providers delve into Central Analysis Bureau (CAB) reports for a comprehensive review, including CSA scores, DOT ratings, out-of-service percentages, and DOT violations. These reports significantly influence the underwriters’ final decision on the rates.

Understanding insurance rates and how they are determined shouldn’t be overwhelming. With a clear perspective and guidance from experienced insurance agents like those at Reliance Partners, trucking companies can secure the most favorable rates, tailored to their unique business needs.

Discover more about how Reliance Partners can assist you in navigating through your insurance needs by clicking here.

To view the full article from FreightWaves click here.