Delaware Business Insurance Update from CNC Insurance Associates Inc. "Misuse of Motor Carrier Data Causing Problems for Trucking Risks" 10-12-15

Small business trucking operations help create the backbone of our economy. However many are paying higher insurance premiums and are being penalized by the misuse of the Federal Motor Carrier Safety data. The SMS (Safety Measurement System) was developed by the Federal Government to identify those trucking risks that need to be scrutinized for roadside checks and onsite inspections. Unfortunately, insurance carriers and the courts are using the data to determine insurance rates and civil liability. The SMS data website clearly states that the data is for determining which trucking risks should be inspected. However the public availability of the data is enhancing its use for other purposes.
This creates a big problem for small business trucking.  The data is flawed in the sense that small violations can be weighted inappropriately and this data is used as gospel by insurers and the legal community. Many trucking operations who have fantastic loss ratios but problematic SMS scores, are paying more premium than they should. In addition if they have an accident , they may find their SMS data scores being used against them in a court of law.
There is some possible relief  for small business trucking forthcoming. Congress has a few bills on the desk which may mitigate the usage of the SMS data by the public. In addition there could be some re-tooling of the data parameters , which could clarify how scores should be viewed and also adding some baseline reference that allows a more accurate assessment of a trucking risk. Stay tuned as this fleshes itself out over the next few years. Until nest time be careful out there and know your risks.

G. Kevin Nemith President, CNC Insurance Associates Inc. & The Small Business Insurance Center
Serving DE, MD, VA, NJ, & PA
www.cncinsurance.com
www.bizinsurancetv.org

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