This month’s featured dispute revolves around how coverage under a base policy is affected by an endorsement. A trucking firm’s employee collided with another driver while returning from an interstate trip which involved delivering goods to both states in his journey. When sued, both the trucker and his employer failed to show up or cooperate with the insurance company. This resulted in a default judgment in favor of the injured driver. The insurer argued that it was not obligated to cover the loss.

The injured driver and the insurer presented arguments concerning the transportation approach that should apply to the loss, in light of the MCS-90 endorsement being attached to the policy.

Click below to see how a higher court interpreted the endorsement’s impact upon appeal.

Motor Carriers, businesses that transport persons or goods over-the-roads for hire, operate under a heavy amount of regulation. It is critically important that accidents are dependably covered. When vehicles such as trucks and buses are involved in collisions, the financial severity is generally very serious. Accidents with smaller vehicles and their occupants must be adequately addressed.

Decades ago, the federal government created the Federal Motor Carrier Safety Act (FMCSA). It requires that many types of trucks and buses meet a broader and higher coverage obligation than what typically applies under standard commercial auto policies.

Click here for more details on the purpose and obligations created by federal regulations. This information is from the Commercial Liability Insurance Section of PF&M found in Advantage Plus.

Even without the burden of regulation, motor carrier operations are difficult to cover. Losses, besides being far more severe than what is experienced by personal vehicles, are quite frequent. Drivers are under constant pressure, often having to be on the road for most of each day.

They have complicated schedules, are subject to tight delivery and pick-up deadlines, and often undergo mandatory testing to guard against drug or alcohol impairment. Further, drivers suffer stress caused by sleep deprivation, loneliness, changing schedules and unhealthy eating.

Click here to see additional information on various exposures involved with motor carriers. It is from the Trucking and Transit category of the Commercial Lines Survey found in Advantage Plus.

Insuring commercial auto, particularly motor carriers, has become more complex. Auto liability claims have long been costly, but problems have increased. Serious accident numbers have been increasing, particularly since the pandemic. A larger concern has been the substantial rise in verdicts awarded against trucking firms. Another concern has been a shortage of truck drivers, an issue that has increased instability and expense.

The commercial auto market is far too large and important to abandon. So, insurance professionals and carriers have focused on methods to hold the reins on and even to improve market’s results. The keys to doing so involve being aggressive in identifying and addressing weaknesses.

Click here to see an excerpted article on handling challenges of insuring commercial autos. It is from the 06/23 issue of Rough Notes Magazine found in Advantage Plus.