Challenges Create New Opportunities for Insurance Agents
The trucking industry has been faced with a number of issues over the last few years including a global pandemic, rising fuel costs, driver shortages, recession fears, increased costs, and the AB5 law which may change the way we look at Independent Contractors. Some of these challenges along with new ones continue to impact the trucking industry however amidst these challenges are opportunities for insurance agents.
The American Transportation Research Institute (ATRI) continues to track the top trucking issues. The issues remain mostly constant; however, the order of concern has changed along with the addition of a new issue. Some of the top concerns are listed below and the chart beneath illustrates the trend of the top 10 issues.
Fuel prices was selected as the top concern, weighing on companies’ bottom lines. The year-over-year fuel cost per mile increased by over 35%. Interestingly, fuel prices have not appeared on the Top 10 list in 10 years.
Second on the list was driver labor shortages—a nearing retirement-age driver force along, fewer young adults obtaining CDLs, a challenging lifestyle, and regulatory pressures are cited as the main reasons. On top of that, technicians and maintenance workers are also in short supply. A recent news article listed the Transportation industry as the #1 sector facing a labor crisis, citing warehouse and logistics positions are already down 3,000-4,000 positions from last year. California lawmakers continue to debate the AB5 law, which would effectively ban independent contractors in the trucking industry, and greatly shake-up in the industry. If this is considered by the Department of Labor at the Federal level, it would represent a massive shift in the way this country’s trucking is accomplished.
Third on the list was truck parking, with drivers citing an inability to find safe, legal parking. Not being able to find safe parking puts drivers at risk of an accident while they search or in violation of their Hours of Service rules. Drivers having to park in unsafe, unlit areas, or on highway shoulders put themselves and others at risk. The lack of available parking has also been tied to driver recruitment and retention issues.
Driver compensation was next on the list, driven by labor shortages and higher freight demand. Fleets have increased pay, as a way to recruit and retain the best drivers. ATRI reports that in 2022 driver wages increased 9.8% over the previous year.
The overall economy ranked 5th on the list with inflation, parts shortages, labor shortages, and fear of recession all playing a factor. The uncertainty of not knowing when prices, labor, and parts will return to normal levels is scary for any company owner trying to navigate their business.
Trucking Workers’ Compensation – An opportunity for Insurance Agents
“Despite all these challenges, the trucking industry remains strong,” says Joe Bukovsky, head of the PMC Trucking and Transportation Workers’ Compensation Program. “That bodes well for insurance agents, especially those that secure Workers’ Compensation coverage for their clients in this industry.” Joe says that we are seeing a rise in trucking payrolls as expected and that some established trucking companies that previously paid drivers as 1099’s are shifting them into W2 drivers and looking for Workers’ Compensation coverage for the first time.
Whether your clients are seeking coverage for Workers’ Compensation, Occupational accidents, or mixed labor of 1099s and W2s, PMC has solutions. Joe says, “some of the industries we have been seeing a lot of growth in include Food Distribution, Long-Haul Trucking, and Fed-Ex companies.”
For more about our Trucking and Transportation Workers’ Compensation Program, contact Joe Bukovsky at joe@pmcinsurance.com. For general information about PMC, our appetite or to send a submission, please contact us at info@pmcinsurance.com or (877) PMC-COMP (877.762.2667).
PMC Insurance Group, a division of One80 Intermediaries, is a leading Workers’ Compensation Insurance wholesaler that places coverage for a wide range of industries nationwide. We offer expertise, access to specialized Workers’ Compensation programs, and creative solutions for even the difficult-to-place accounts.
One80 Intermediaries offers market-leading access to all major insurance markets in the US, UK, and Canada, as well as exclusive programs and in-house binding authority for property & casualty, financial lines, personal lines, life insurance, medical stop loss risks, travel/accident and health, affinity business and warranty coverage.
One80 serves commercial companies, non-profits, public entities, associations, unions, and private individual risks; and has offices in 55 locations throughout the US and Canada.
