Commercial trucking often serves as a trusted barometer for the U.S. economy. In 2019, America’s truckers carried 11.84 billion tons of freight and generated $791.7 billion in revenue*.
* Source 1
However, with trucks responsible for carrying 80% of the nation’s cargo, there are more trucks on the road than ever before.6 With more trucks on the highways, the frequency of accidents has also risen, including an increase in fatalities. In 2018, large truck crashes accounted for 11% of all motor vehicle accident deaths.6 According to the American Trucking Association, in 2017, commercial trucks were involved in 59% more accidents per mile than in 2010, despite newer technology and the best efforts of regulators. Furthermore, the number of people who died in large truck crashes in 2018 was also 31% higher than in 2009, when rates were at their lowest since the collection of fatal crash data began in 1975.7
The Federal Motor Carrier Safety Administration (FMCSA) reports that the average cost of a commercial truck accident in which one person is injured is $148, 279. However, the costs associated with a fatal trucking accident skyrockets to $7.2 million, with the numbers growing exponentially if multiple people are injured.8 In addition, it should be noted that these numbers don’t account for the rising cost of truck repair and liability claims. With the frequency of accidents increasing, claim costs are almost twice as likely to exceed $100,000.2
On the surface, the primary reason for the greater severity of truck accidents can be attributed to the weight discrepancy between trucks and passenger cars. Trucks usually weigh 20 to 30 times more than passenger cars.7 They’re also taller with greater ground clearance, resulting in the smaller vehicles under-riding trucks in accidents. Truck braking capabilities are also an issue. A loaded tractor-trailer takes 20% to 40% more distance to stop than a passenger car.7 And, this discrepancy only grows on wet and slippery roads or with poorly maintained brakes. In addition, many older $50,000 trucks are now being replaced with new $150,000 trucks that cost much more to repair.2
Controlling losses is a big challenge for the trucking industry, especially with driver fatigue becoming a big issue. Drivers of large trucks are allowed by federal hours of service regulations to drive up to 11 hours at a stretch. However, surveys indicate that many drivers violate the regulation and work longer than permitted.7 In December 2017, the long-awaited FMCSA (Federal Motor Carrier Safety Administration) rule requiring trucks to have Electronic Logging Devices (ELD) that accurately track and manage a vehicle’s record of hours of service went into effect. The ELD device is designed to automatically record driving time, enabling motor carriers to better comply with federal limits for safe driving.
Around the same time, the American Automobile Association Foundation (AAA Foundation) and the Alliance for Driver Safety & Security (the Trucking Alliance) joined forces to adopt the AAA Foundation’s new Truck Safety Recommendations, including various warning, monitoring, and braking systems that could prevent as many as 77,000 crashes and save up to 500 lives annually. Both experienced and new drivers report wanting “all the bells and whistles” offered by new equipment not only to improve personal comfort, but to take advantage of innovative safety technology as well.
Recent Trucking Claims
AGING TRUCKS & DRIVERS
The trucking industry’s problems are compounded by the fact that the average truck driver is generally approaching 50 years of age or older.6 As the average age of drivers increases, trucking companies are struggling to attract new drivers, leading some companies to consider easing their hiring requirements to entice new employees – including dropping commercial driving experience requirements down to as little as 1-year or less. As older drivers retire, meeting the nation’s freight demand will mean hiring over 1 million new truck drivers by 2028 to keep pace with economic growth.5
Anecdotally, the chronic driver shortage is considered a leading cause of the general erosion of driver safety, but gathering the data to support that theory is easier said than done. Most carriers don’t have the level of claim detail built into their claims systems needed to actuarially confirm that the age and experience of drivers makes a meaningful difference. However, numerous insurers are now asking deeper questions around driver experience. Many trucking firms are also beginning to invest in better training for new and existing drivers around safety technology, recognizing that adequate training can make all the difference.
With more trucks on the highways, the frequency of accidents has risen, including an increase in fatalities. Controlling losses continues to be a big challenge for the trucking industry as it faces increased demand and driver shortages. Anecdotally, the chronic driver shortage is considered a leading cause of the general erosion of driver safety, but gathering the data to support that theory is easier said than done. Most carriers don’t have the level of claim detail built into their claims systems to actuarially confirm that the age and experience of drivers makes a meaningful difference. However, numerous insurers are now asking deeper questions around driver experience. Many trucking firms are also beginning to invest in better training for new and existing drivers around safety technology, recognizing that adequate training can make all the difference.
CRC Group has the proprietary data technology to analyze what’s happening in the trucking industry and help weigh the unique risks facing insureds. Contact your CRC Group Producer to learn more about how we can help your commercial transportation clients.
- Trucking Moved 11.84 Billion Tons of Freight in 2019, American Trucking Associations, July 13, 2020. https://www.trucking.org/news-insights/trucking-moved-1184-billion-tons-freight-2019
- 2018: A Challenging Year for Trucking, Donald Jerrell, https://www.hni.com/blog/2018-transportation-industry-predictions
- $1.4 million settlement obtained for plaintiff injured in multi-vehicle truck accident, Fitzsimmons Law Firm PLLC, March 15, 2019, https://www.fitzsimmonsfirm.com/blog/2019/march/-1-42-million-settlement-obtained-for-plaintiff-/
- Advisen Claims Data; advisen.com
- ATA: Trucking Industry Was Short More Than 60,000 Drivers in Meeting Demand at End of 2018, Transport Topics, July 24, 2019. https://www.ttnews.com/articles/ata-says-truck-driver-shortage-course-double-decade
- The Ultimate List of Driving Statistics for 2021, https://driving-tests.org/driving-statistics/
- Fatality Facts 2018: Large Trucks, IIHS, https://www.iihs.org/topics/fatality-statistics/detail/large-trucks
- 4 Ways GPS Tracking Cameras can Reduce the High Cost of a Truck Accident, HDFleet, November 15, 2018. https://hdfleet.com/cost-of-a-truck-accident-to-a-company/