Trucking Insurance Renewal: Lower Premium Strategies

February 27, 2024 Blog, Commercial Truck Insurance

Are you considering getting a quote to renew your commercial truck insurance and accessing lower premiums? In the increasingly competitive and regulated business world, we find ourselves in, maintaining a good Safety Score for your truck transportation company is essential for obtaining fair insurance quotes. But when we talk about the Safety Score, do we know what it’s about? Do you know how you can improve it? Keep reading, as we’ll tell you everything you need to know about the Safety Score so that your company isn’t affected by a poor score that could impact the value of your commercial truck insurance.

What is the Safety Score?

The Safety Score or safety rating is a measure that reflects the level of compliance, safety, and responsibility of a transport company in the United States. This score is calculated by the Federal Motor Carrier Safety Administration (FMCSA) based on data from roadside inspections, accident reports, claims, investigation outcomes, and registration details. In addition to this, driver training, inspections, preventive and periodic maintenance, and road safety protocols are also assessed.

A good score on your truck company’s Safety Score is very useful in the event of an audit by insurance companies, as it can affect the price of a commercial truck insurance quote, reputation with customers, driver recruitment and retention, and the frequency of compliance checks. That’s why it’s important to know the good safety practices that a company can have to have a good Safety Score and avoid the negative consequences of a poor score!

Do you want to know how to improve your Safety Score?

  • Keeping Loss Runs Updated: Loss Runs are detailed records of insurance claims filed by a company in the past. Demonstrating a positive trend in reducing claims can help improve your Safety Score. This shows insurance companies that your truck company takes proactive measures to prevent accidents and losses. In addition to this, corrective measures taken, incident and accident tracking and recording, demonstrate a commitment to safety and continuous improvement.

  • Regularly reviewing the CSA (Compliance, Safety, Accountability) score: The CSA score is a key component of the Safety Score and is updated monthly, and it can be checked online Federal Motor Carrier Safety Administration’s (FMCSA) Safety Management System (SMS) website with the company’s DOT number. The CSA score ranges from 0 to 100, with 0 being the best and 100 being the worst.

  • Monitoring operational radius: The maximum distance a vehicle travels from its operating base. The operational radius can influence the Safety Score because it implies greater risk exposure and wear and tear on the vehicle. The commercial policy premium may be higher if your transport company operates on routes and highways with high accident or theft rates.

  • Compliance with new regulations: Safety and compliance regulations are constantly evolving. Your truck company needs to be aware of new regulations requested by entities to assure compliance. This not only ensures the safety of your employees and assets but can also help improve your safety score and avoid penalties for non-compliance.

  • Install, configure, and set up an ELD (Electronic Logging Device): This device connects to the truck to record driven hours and the miles traveled. The ELD will allow monitoring of your trucks’ performance and verifying compliance with regulations.

  • Understanding insurance market conditions: Being informed about insurance market conditions is essential for obtaining competitive quotes. Insurance premiums may be higher if the market is experiencing increases in claims or indemnity costs. Staying informed about market trends is key to considering adjusting your company’s safety strategy. Remember that on our website, you can find news and updates from the insurance market.

Here’s a checklist for you to keep track of what you need to do to improve your transportation company’s Safety Score.

Extra recommendations for you and your trucking company:

  • Consider additional coverages: In addition to meeting the basic requirements of commercial trucking insurance, consider adding additional coverages that can mitigate specific risks for your company or location. For example, companies located in areas prone to natural disasters may benefit from physical damage insurance.

  • Consider economic and climatic factors: Economic and climatic factors can significantly impact business safety and risk. For example, a recessionary economy may increase theft or vandalism, while extreme weather events can increase property damage risk. Consider how these factors can affect the safety of your transportation company.

  • Complying with OSHA (Occupational Safety and Health Administration): The National Agency responsible for protecting worker health and safety in the United States considers it important that a transportation company establish a plan to prevent work-related injuries, illnesses, and deaths, as well as to ensure fair and equitable working conditions. OSHA offers training, counseling, technical assistance, and inspections to verify compliance with its standards.

Benefits of having a good Safety Score on the safety score:

1- Having a better risk profile for insurance companies.

2- Better prices for your commercial insurance policy renewal.

3- Reduced accidents by implementing a Safety Plan for your transportation company.

4- Regulatory compliance.

In summary, improving your truck company’s Safety Score requires a comprehensive approach that addresses various aspects of safety and risk. By implementing good practices such as keeping Loss Runs updated, complying with regulations, staying informed about insurance market conditions, and considering additional factors such as operating radius and economic and climatic factors, your transportation company can improve its position with insurance companies and obtain more competitive quotes, with monthly premiums more favorable when quoting commercial insurance for your truck. Still, have doubts about the safety score or how to carry out all the aforementioned processes? At Preventty- USA Specialty Insurance, we provide the guidance you need and deserve!