This Opinion piece appears in the Aug. 22 print edition of Transport Topics. Click here to subscribe today.
By Mitchell Sharp
Documenting what you have done is a regular part of the trucking industry. At least it should be.
All of the documenting that is required may seem mundane to a young driver. It may not seem necessary, but when something goes wrong, it can make all the difference in the world for you as a driver and for a business owner. A well-documented safety program can help a trucking business in many ways, but three main reasons are: It can help prevent accidents, it can help injured workers get back to work quicker, and it can lower costs for commercial insurance.
From the insurance carriers’ perspective, driver wellness is a huge factor when considering insuring a business. Anything a business can do to integrate breaks from the road in an attempt to improve general driver health will help set it apart from competitors in the industry. Many carriers use the Compliance, Safety, Accountability ratings from the Federal Motor Carrier Safety Administration when considering covering a business. This rating is often used as a guide to see how effectively each business handles vehicle maintenance and driver management. Some carriers even use it as a straight qualifier or disqualifier, so it is a good idea to monitor this rating.
A well-documented driver safety program is essential when it comes to acquiring and saving on commercial insurance because it prevents accidents from occurring. When fewer accidents happen, drivers are healthier and happier. It also makes your insurance carrier happy, and it is more likely to reward your business with a better rate on premium,
When you have a well-documented safety program in place, your business will have a positive loss history. That means you pay more in premium than you take out in claims. Having fewer claims will cause your business to have a better experience modification rating, which is what a carrier uses to determine whether to offer coverage and how much to charge in premium. When these ratings are good, it will directly affect what you pay in premium. Also, your business will operate better because you will have fewer sick and injured workers.
On the back end of your policy, a sound driver safety program can help in a big way when an accident does occur. If you are in business employing drivers, you eventually are going to experience an accident. It is not a matter of if, but when. When these accidents happen, how prepared you are to get workers back on the job will affect the cost of the claim. The quicker the worker gets back on the job, no matter in what capacity, the more likely he or she is to return to work permanently.
Again, if you have a safety program in place, your agent can use it as a negotiating tool — especially when your business is up for renewal. Whether you have one or several claims in a policy period, your insurance carrier frequently will raise what you pay in premium. Some may even cancel your policy. If you have a well-documented driver safety program in place, your agent can use that to show the claim is more of an outlier and less of a sign of how you do business. The agent can speak with the insurance carrier that writes your policy and can use this program to explain how the business is taking steps to prevent the occurrence from happening again.
Finally, having a safety program in place can lower what the business pays for commercial insurance. This can happen because insurance carriers are more likely to give credits and discounts to businesses they deem a safe risk.
If you have a well-documented driver safety program in place, your business will have fewer claims, the claims will be less severe, the injured workers will return to work more quickly and this will positively affect your experience modification rating. When these things occur, your insurance agent can use this program to show your business is taking precautions to limit the frequency and severity of claims.
Businesses that do this are the ones insurance carriers want to offer coverage. If you are showing the insurance carrier ways in which your company is ensuring drivers are prepared to meet their daily challenges, the insurance carrier will do more to entice you to join its book of business.
WorkersCompensationShop.com is a commercial insurance agency located in Columbia, Missouri, and licensed in all 50 states. For more information go to: www.workerscompensationshop.com.