What, When, Who, and How of Trucking Insurance Rates

You’ve had a clean 12-month period in your truck(s), keeping America moving. Zero claims and zero out of service violations. Your agent tells you this is great, and your insurance will probably go down this year. Thirty days before your renewal and you start asking when you’ll have a quote back, and they tell you they’re working on it and it should be next week. Monday roll around, and the message is it should be Friday. The two-week mark hits and your agent wants to meet three days before the renewal. Seems a little close and you ask what the new rate is. “Well, it went up a little bit, but I’m waiting for some more options to come back”. You’re mad and probably confused because you thought having a good year meant lower insurance, and your agent even said so.

The truth is many truckers and trucking companies find themselves in the same situation year in and year out. Maybe they shop their insurance every few years to new agents, but it still results in the same cycle with you, the client, as the loser. Because make no mistake when you pay more for your insurance, we agents, make more 99% of the time. I have a problem with that because when I’m able, I do like to sleep well at night. If you never grow your company, “Why should your agent ever make any extra money?”, but that’s a conversation we can have one-on-one. Right now, I want to focus on the questions you need to be asking your agent every year, and throughout the year to make the insurance companies WANT to do business with you instead of HAVING to do business with you.

The “What” of Trucking Insurance

This is an easy one, sort of.

What can I do to lower my insurance?

For 60% of trucking companies this should be a very easy answer if your agent understands trucking as they say they do. For the remaining 40% it could still be possible, but your agent may not be the best at providing this savings opportunity.

What do the insurance companies want to see?

This is by far my favorite question to hear from a client. First of all it let’s me know that they’re really starting to understand the insurance process, and they’re wanting to take their own operations to the next level. This is also the question that is probably going to make your realize that your agent may not know as much as they claim. If their answer is loss runs, IFTAs, MVRs, or any simple document that you’ve already provided, please call me IMMEDIATELY. If there is a lot of stammering and a few ‘Well…’ or ‘Uh…’ and maybe ‘What do you mean…’ tossed in there, call me, IMMEDIATELY.

What are your other clients like me paying, and who are they insured with?

Your agent does not need to, nor are the allowed to, give you specific client information, but they should be able to give you an average of what clients in your particular niche are paying and even a range for the top performers. We may not always know what every carrier’s pricing is, especially if we don’t write with them, but your agent should have a strong knowledge of their own clients if, in fact, they’re capable of answering the first two questions.

The “When” of Trucking Insurance

The most popular question I always get:

When will you have my quote ready?

Unfortunately, I would love to tell you I have the magical answer for this, and that all of my clients have their renewals finished forty-five days in advance, but I can’t. Luckily not many agents are able to say that unless they are managing their own programs. There are carriers out there that can have your renewal ready 30 days prior to the actual renewal date. This is, of course, only possible when your agent has given them all the information they have requested.

When will you start shopping for my renewal?

Another popular question and you are probably going to get a variety of answers. As soon as possible, the first day, etc. are both very common answers, but what do they mean. Most carriers start accepting submissions either 90 or 125 days before your renewal. However, most insurance carriers want your information (loss runs especially) to be valued within 90 days from your renewal. Even further some carriers have started to only accept submissions between 30 and 60 days from renewal. I say all of this because if your agent is doing their job, there is going to be a good amount of back and forth for extra information during your renewals every year. If they’re not coming back for new information ever year, and you only speak at the beginning of your renewal then you should be concerned about what information they’re sharing, or not sharing with the underwriters.

When are you going to stop taking so much of my money?

Okay, this one is mainly to add a little humor into what may have become a boring article. Truth be told this answer goes beyond your actual insurance policy, and beyond the capabilities of most insurance agents. You will need to be committed to making the necessary changes, and your agent has to be committed to this result as well. If this is a question that you still do not have the answer for, after years of asking then, call me, now. Seriously, right now, pick up the phone.

The “Who” of Trucking Insurance

Good news! You are halfway to the end, and this is a one question section

Who ultimately receives all my information?

You give a lot of personal information to your agent, and you have the right to know its protected. Coincidentally this is also the question that gives you a strong indication of how many options your agent will have for you. When it comes to trucking insurance, there are typically 3 avenues through which agents can place your business: Direct Contracts, Wholesalers, and Program Management.

Direct Contracts   are when we have direct access to the underwriters (in most cases) to negotiate terms, and your specific needs. Examples: Progressive, Great West, Sentry

Wholesalers  are essentially insurance brokers for insurance brokers. The majority of trucking insurance is actually written through wholesalers. A few carriers that you will primarily find through a wholesaler: Canal, Northland, NICO, Occidental

Program Management  is when an agency has developed a large enough book of clients, that they are able to approach an insurance company to underwrite a program exclusively for their clients. In certain, situations a carrier can be accessible by direct contract, through a wholesaler, and underwrite a program for an agent. 

You should ask your agent for a list of what carriers they have approached on your behalf every year, and they should be able to provide it easily. If they return fewer than five carriers, ask why? This may not necessarily be a bad thing as most agents should know your business and which of their carriers will be the best fit for you. If they return more than ten carriers, ask why? Too many submissions among carriers can make it appear as if there are problems on the account and may not always be in your best interest. Never accept “We submitted it everywhere” as an appropriate answer from your agent because everywhere for them, probably isn’t very far.

The “How” of Trucking Insurance

How do I make the insurance companies fight for my business?

Believe it or not, for the right company insurance companies will compete, and lower their rates against each other. However, very few of them want to be the first one in the competition and timing is key, but there are a few things you can do to put yourself in position to reap the benefits of this competition.

Document the Proof  – Underwriters and insurance companies focus on trends. It is easier to overcome a bad loss with proof of good safety history than it is to prove you are a safe operation with poor safety history even if your losses are not good. Insurance companies understand and expect accidents, that is what they are purpose is, but none of them want to be on the hook when your good luck finally runs out. Show the underwriters proof of your safety practices. Show them your corrective actions and driver training.

• Good safety scores + good loss ratios = a good risk.
• Bad scores + bad losses = a bad risk.
• Good safety scores + bad loss ratio = potential for good risk with additional info
• Bad scores + good loss ratio = Big question mark for the underwriter.

Be Honest  – It may seem hard to believe at times, but the insurance company and their underwriters are your friend, or at least in most cases. If there’s an aspect of loss control that you don’t understand or feel you may be lacking, ask your agent for clarity. Insurance companies have entire departments dedicated to loss control, that are available to you as the client. Don’t try to hide anything from your operating history because there are enough systems available to where the insurers will find it, and it looks much worse if they find it instead of you being up front. 

Get In Front of Them  – You are probably thinking I’ve lost my mind at this point, but what I mean is to make sure you’re getting submitted to the market as well as you should be. An insurance company cannot see how well you are doing and offer you a better rate if they never receive your submission. I have lost count of the number of clients I have won over the years simply by informing them that my top three markets have never even seen a submission on them. 

For everyone still with me, thank you for taking the time to read this. If you have any questions please feel free to reach out, and I’ll be happy to help.