The Federal Motor Carrier Safety Administration (FMCSA) is being urged by Congress to raise the minimum liability insurance coverage for truck accidents. Currently, the minimum amount is $750,000.
Because the Law Offices of Peter Miller concentrates its practice in the area of car and truck accident cases, we have been closely involved in the effort to raise the minimum commercial insurance for over-the-road trucks. We have provided information and specific data regarding many of our truck accident cases to representatives of the congressional committee studying this matter. We anticipate being asked to testify before the Committee.
Proponents of the action say that the current minimum, implemented in the 1980s to discourage carriers from employing poorly trained drivers, driving poorly maintained trucks, is no longer sufficient. They cite the increased cost-of-living since the 1980s as the reason for the needed increase in coverage. With rising health care costs, what $750,000 would pay for in the 1980s, would cost around $4.4 million today.
Congressional members urging the increase say that catastrophic injuries resulting from a trucking accident normally require surgery, extensive physical therapy, other related medical expenses, property damage reimbursement and loss of wages. Those combined costs would be greatly in excess of $750,000. Other government health care plans, such as Medicare and Medicaid would have to fill in the gap, a cost that is ultimately paid by taxpayers.
They further argue that $750,000 is not a large enough amount of money to discourage trucking companies from operating poor maintained vehicles and putting poorly trained drivers on the road. Safety is the issue for the driving public. Higher premiums will force trucking companies to implement better driver training and provide an incentive for better-maintained trucks.
Many trucking companies opposed to increase
Not surprisingly, many trucking companies are opposed to an increase in premiums for higher minimum liability insurance coverage. Here is a sampling of the reasons for their opposition.
- The American Trucking Associations maintain that only one-tenth of 1 percent of trucking accidents have claims exceeding $750,000. They also point out that more than 93 percent of policies on heavy trucks already exceed $1 million. In addition, crashes that exceed insurance limits are estimated at only 30-100 per year.
- The Owner-Operator Independent Drivers Association says that current data doesn’t support the need for an increase, and that fewer insurance carriers will insure for an increase in coverage. This could cause premiums to spike and limit competition among insurance companies.
- The Transportation Intermediaries Association fears that the increase in premiums will force small trucking companies (1-6 trucks) out of business.
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