CSA Effect on Insurance Rates Still Unclear

By | February 1, 2011

What will happen to the cost of insurance for fleets following implementation of the Federal Motor Carrier Safety Administration’s Compliance, Safety, Accountability program?

The answer: It depends. Insurance underwriters are likely to take CSA scores into account in providing coverage and setting rates, but the full effect of the new safety enforcement regimen on the cost of insurance for freight carriers, brokers and shippers remains to be seen, according  to experts.

“Driver scores will become part of the underwriting process,” said Tommy Hodges, chairman of Titan Transfer in Shelbyville, Tenn., and a former chairman of American Trucking Associations. Hodges said CSA data give insurers another tool to identify carriers that pose a greater risk of accidents and will “price accordingly.”

Ed Campbell, chairman of First Guard Insurance Co., Venice, Fla., a company that insures about 13,000 independent truck owner-operators, said CSA data offers insurers a “fuller picture” of drivers’ performance and will be used to supplement other data sources, such as motor vehicle records, to weed out drivers who are “marginal” or “less-safe.”

“If CSA plays out as designed, it ultimately should yield a lower accident rate and . . . lower [insurance] rates,” he said.  Some trucking industry officials urge caution in using CSA data.

“We would be concerned if insurers take CSA scores at face value as a measurement of safety performance,” said Rob Abbott, vice president of safety policy for ATA. “CSA scores are not intended to be safety ratings. This is especially important for insurers to know since FMCSA’s preliminary analysis reflects that — in at least two [of seven Behavior Analysis and Safety Improvement Categories] —high BASIC scores are a poor predictor of crash risk.”

Despite those concerns, many trucking industry officials and legal experts  say they expect CSA scores to become a key measure of carrier-safety performance  and Exhibit A for attorneys looking for evidence of fault in crashes involving commercial trucks. (TT)

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