Commercial Auto: An Old Dog Up to New Tricks

By Steve Discher and Ray Mazzotta | December 28, 2018

  • December 28, 2018 at 2:30 pm
    Dan Fagan says:
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    Very informative article. This information needs to get to the insuring public. It needs to be written about in newspapers, magazines, TV News stories, etc.. Insurance companies and agents association need to spend some money to educate the customers. Commercial auto customers understand that the insurance company has to make a profit or go out of business. We should not underestimate the consumer’s intelligence. Tell them what is happening and what the insurance industry is trying to do to combat the problems.

    • December 31, 2018 at 11:59 am
      Perplexed says:
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      You’re right Dan. I save these articles to share with my customers. It helps us explain why they are seeing increases at every renewal.

  • December 28, 2018 at 2:56 pm
    Agent says:
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    As someone who has written a fair amount of Commercial Auto over the years, there seems to be a recurring theme to losses on this line of business. 1. Lack of proper screening of drivers, ie drug screening, MVR issues with multiple violations and letting people drive with records. 2. Plaintiff’s attorneys suing for huge amounts even on minor accidents with trucks involved and 3. High cost of repairs on vehicles. God help us if autonomous trucks are used in a big way. Those accidents will be far more expensive when the autopilot runs over a family and then overturns in a ditch totaling the vehicle and its contents.

  • December 31, 2018 at 11:52 am
    broker says:
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    Solid overview of the challenges of the auto market, few observations:
    1) American driving culture has significant potential for improvement. As an instructor in the BMW Street Survival teen driving program the lack of real education of driving risks at the teen level sets the tone for a very marginal driving culture. Something as basic as cars that drive in the left lane on the highway forcing other cars to pass on the right increases risk as well as frustration.
    2) I can’t imagine having a fleet of autos without cameras to improve managing risk and allow for quick resolution of claims. Cameras can also provide great feedback to drivers. Certainly may increase exposure with some at fault accidents but the advantages of having no liability for other accidents is pursuasive.
    3) Rate increases in 23/25 quarters is an impressive statistic and provides a compelling reason to evaluate Casualty Group Captives. Premiums are based only on the five year loss history of each account. These programs can offer compelling market insulation for best in class accounts – and some captives include a $2mm primary auto limit.

  • December 31, 2018 at 1:51 pm
    Ben Sessions says:
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    Doesn’t the trend towards less profitability in the auto market call into question the idea that technology is going to wipe out this sector? It seems that with more technologically cars, we are seeing the opposite of what was anticipated.

    • December 31, 2018 at 3:41 pm
      UW says:
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      We’re just at the beginning. There needs to be enough saturation of new vehicles with new safety technology before the benefits will be realized and we’re nowhere near that inflection point yet. Just like doing one push-up or eating one salad isn’t going to make you fit, but keep up with it and give it time.

  • December 31, 2018 at 1:59 pm
    SacFlood says:
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    Great article; agree with all comments thus far. The Insurance Industry is one of the main forces behind autonomous vehicles, as they don’t trust us to stop using our cell phones, for one thing. Distracted driving (cited in the article) is certainly one of the principal factors behind this push. If states passed laws which took away a driver’s license if caught using a cell phone, then perhaps we would finally see cell phone usage behind the wheel decrease. Virtually no amount of technology can completely erase the risk of a distracted driver, imho.

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