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Speaker 1: Hi everyone, this is Lee Klaska when We're Talking Transports.

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Speaker 1: Welcome to Bloomberg Intelligence Talking Transports podcast. I'm your host,

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Speaker 1: Lee Klaskow, senior freight, transportation and logistics analysts at Bloomberg Intelligence,

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Speaker 1: Bloomberg's in house research arm of almost five hundred analysts

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Speaker 1: and strategists around the globe. Quick public service announcement before

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Speaker 1: we dive in. Your support is instrumental to keep bringing

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Speaker 1: great guests and conversations to you, our listeners, and we

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Speaker 1: need your support. So please, if you enjoy this podcast,

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Speaker 1: share it, like it and leave a comment. Also, if

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Speaker 1: you've got ideas, feedback, or just want to talk transports,

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Speaker 1: I'm always happy to connect. You can find me on

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Speaker 1: the Bloomberg terminal, on LinkedIn, or on x at Logistics.

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Speaker 2: Lee.

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Speaker 1: Today, we're going to be doing something a little different.

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Speaker 1: We have two guests for the price of one. I'm

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Speaker 1: very excited to have with us today Andrew Ladibache, the

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Speaker 1: co founder and CEO of Reliance Partners, the nation's largest

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Speaker 1: independent insurance agency focus exclusively on transportation and logistics. Also

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Speaker 1: joining us are the company's chief revenue officer, Tom Albrighter.

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Speaker 1: Welcome to Talking Transports, Tom and Andrew. Thanks you so

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Speaker 1: much for coming on today.

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Speaker 3: Great to be here, Lee.

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Speaker 2: Yeah, thanks for having.

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Speaker 1: Us and SO Reliance Partners. You know, it's maybe not

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Speaker 1: a household name for everyone listening. Can you just give

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Speaker 1: a little background about the company.

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Speaker 2: Yes, sir, So Reliance Partners. As you said, as we

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Speaker 2: are a retail insurance broker that specializes in the transportation,

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Speaker 2: logistics and supply chain industries. The company was found in

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Speaker 2: two thousand and nine by myself and a couple other

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Speaker 2: serial entrepreneurs that actually have a background in the freight

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Speaker 2: brokers industry, ted Alling Very Large, Brent Large, Allen Davis.

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Speaker 2: They had founded Access to America Transport, which eventually was

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Speaker 2: acquired by Cody Logistics. Great guys, I'd met them. I

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Speaker 2: grew up in the transportation industry and started within the

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Speaker 2: insurance realm in late two thousand and two. Really probably

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Speaker 2: got everything started in the beginning of two thousand and three.

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Speaker 2: So all I've done for my whole professional career is

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Speaker 2: risk management and insurance and specializing transportation and logistics companies.

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Speaker 2: Have seen the industry drastically change over those twenty years,

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Speaker 2: for good and bad. Some of the things that we

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Speaker 2: face today that I know we're going to really target

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Speaker 2: rising insurance costs, inflationary pressures, how to recombat that from

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Speaker 2: the transportation and freight broker's side, and those are things

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Speaker 2: that we do every single day at Reliance. Obviously, we're

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Speaker 2: fortunate to have Tom Albrick come on in. Tom's a

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Speaker 2: vital piece of our business. And I think what makes

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Speaker 2: us a little unique in this industry is not only

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Speaker 2: our specialty, but if you look at our executive team.

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Speaker 2: My business partner, Chad Eichelberger comes from the freight broker's

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Speaker 2: background as president of Access to America, President Brokerage at Cody.

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Speaker 2: Ronald Ramsey our chief commercial officer, as a background and

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Speaker 2: asset based trucking and freight brokerage. Tom obviously from the

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Speaker 2: analyst side and consulting in M and A platforms. So

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Speaker 2: I think what makes us really unique is really the

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Speaker 2: diversity amongst our team Laura and Howard Coo, who comes

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Speaker 2: from a family of entrepreneurs and started a trucking and

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Speaker 2: brokerage business within our family business is we truly sit

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Speaker 2: on the same side of the table as our clients.

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Speaker 2: We have faced the pressures that a lot of our

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Speaker 2: clients have over the years, so it helps us address

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Speaker 2: any insurance needs they may have or come up across.

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Speaker 2: And it's really what's helped our company drive to become,

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Speaker 2: as we see it, the largest masure of the number

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Speaker 2: of trucking companies that are out there in the country today.

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Speaker 1: Right, So insurance has been top of mind for a

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Speaker 1: lot of companies. Part of my day job as an

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Speaker 1: analyst is I get to listen to earnings calls, and

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Speaker 1: boy is that exciting. A lot of trucking companies have

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Speaker 1: been calling out insurance, higher insurance costs.

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Speaker 2: So could you just.

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Speaker 1: Dive in a little bit like why is the industry

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Speaker 1: facing these higher premiums? What's going on?

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Speaker 2: I think a lot of I mean typical what you

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Speaker 2: hear inflationary pressures within the insurance industry and insurance realm.

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Speaker 2: I think what's unique about our industry is a lot

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Speaker 2: of the reports and earning reports that you just brought

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Speaker 2: up are kind of the largest publicly traded trucking companies

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Speaker 2: and operators in the country, right and some in the world.

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Speaker 2: The way they purchase insurance is drastically different than if

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Speaker 2: you look at the number of motor carriers that are

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Speaker 2: four higher ninety percent of the marketplace is under twenty units.

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Speaker 2: That's a vastly different approach to purchasing your insurance than

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Speaker 2: the large publicly traded companies. But in that same note,

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Speaker 2: a lot of the primary insurance companies that ensure transportation

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Speaker 2: and supply chain risk are all the same. So you

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Speaker 2: have certain carriers out there that we're right, individual owner

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Speaker 2: operators that are also in part of the towers and

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Speaker 2: the umbrellas and the primary markets for the largest transportation

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Speaker 2: companies in the country. And I think what you always

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Speaker 2: hear about is nuclear verdicts. We always hear about those things.

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Speaker 2: That's always kind of a topic of discussion. But I

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Speaker 2: think Tom andized one thing we always discuss internally, and

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Speaker 2: what I've seen over the years is really the pressure

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Speaker 2: from PLAINUS attorneys and people don't realize that some or

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Speaker 2: even private equity funded to fight these claims is it's

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Speaker 2: the number of claims that are being settled much higher

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Speaker 2: than what they were in the past. So you take

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Speaker 2: and think about the number of claims every day that

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Speaker 2: are settled that could be kind of your day to day.

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Speaker 2: We're in collisions that in the past might be five

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Speaker 2: or ten thousand dollars. All of a sudden, you get

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Speaker 2: pressure and you serve papers and those claims are settled

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Speaker 2: at fifty sixty seventy eighty thousand dollars. Well, that's happening

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Speaker 2: every single day, And I think that's one thing that

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Speaker 2: people don't realize is equipments more expensive. So when you

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Speaker 2: have your compeclusion, your physical damage premiums, those are going up.

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Speaker 2: It's much more expensive for insurance companies to replace a

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Speaker 2: full loss on a tractor and trailer you have the liability.

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Speaker 2: That's obviously what we just discussed. The third party claims

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Speaker 2: that you know, large nuclear verdicts have contributed to it,

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Speaker 2: but I think that's contributed to kind of this the

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Speaker 2: fear amongst insurance companies to really dip their toes in

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Speaker 2: the transportation marketplace, and I think that's one thing. So

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Speaker 2: all of a sudden, you have the capacity and number

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Speaker 2: of carriers willing to participate in the risk of trucking companies,

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Speaker 2: it's getting smaller. So what's that mean is the careers

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Speaker 2: that have been in it and it's trading dollars, So

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Speaker 2: if they've lost some money, they're naturally going to increase

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Speaker 2: their premiums. You're in, you're out. Sometimes it's five percent,

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Speaker 2: sometimes it's twenty five percent, sometimes it's fifty percent. And

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Speaker 2: I think what you're seeing is a smaller number of

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Speaker 2: companies willing to really jump into this marketplace, which is

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Speaker 2: something we buy every day as an agency, as we

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Speaker 2: are constantly working beyond the scenes to say like, hey,

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Speaker 2: not all risk are bad. You can make money in

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Speaker 2: this marketplace, but it is difficult, and it's going to

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Speaker 2: continue to be difficult, and I think we'll touch on

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Speaker 2: that later in this podcast.

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Speaker 3: Yeah, and lead just for the sake of your audience

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Speaker 3: and you know, even yourself. You know, those public carriers

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Speaker 3: typically have a deductible anywhere from two million dollars to

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Speaker 3: ten million dollars per incident. The vast majority of our customers,

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Speaker 3: which number merely ten thousand moment carriers only carrier carry

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Speaker 3: the one million dollars minimum auto liability. Technically the regulation

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Speaker 3: is seven hundred and fifty thousand dollars, but underwriters don't

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Speaker 3: ensure that. And then another difference is that almost are

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Speaker 3: the vast majority of our customers do not have any deductible,

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Speaker 3: so it's first dollar coverage on that autoliability premium so

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Speaker 3: there's some big, big differences. Now some of our larger

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Speaker 3: customers three hundred, five hundred and eight hundred trucks, Andrew

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Speaker 3: handles them, and many of them do have deductibles, but

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Speaker 3: they're not going to be a million, two million, ten million, Andrew,

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Speaker 3: I don't know what you maybe want to give the

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Speaker 3: audience a little sense of when they start to have

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Speaker 3: a deductible what it might be.

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Speaker 2: Yes, for sure, John, So that's a great point to

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Speaker 2: bring up. And you know, what's what people don't see

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Speaker 2: and what we're seeing right now is kind of any

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Speaker 2: carrier that's really approaching, honestly, fifty trucks and up. The

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Speaker 2: only way they're able to somewhat predict costs for next

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Speaker 2: year when they were new and try to stabilize the

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Speaker 2: insurance premiums is they are starting to take on deductibles

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Speaker 2: or retentions, which means they are accepting the risk on

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Speaker 2: the first it could be ten thousand dollars. Lely, it

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Speaker 2: could be twenty five thousand, could be fifty thousand, some

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Speaker 2: of that varries. If it's a true asset based company

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Speaker 2: or if they're more ic based, they may not take

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Speaker 2: on as much because they don't have the physical damage

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Speaker 2: with the equipment, but those are factors that are definitely

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Speaker 2: driving kind of decision making and saying, okay, this is

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Speaker 2: already one of our four largest expenses, you know. And

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Speaker 2: I think what it's important is the general audience is

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Speaker 2: transportation is difficult. Running a trucking company is very, very difficult.

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Speaker 2: Margins are thin, become even thinner over the last few years.

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Speaker 2: You know, how to re somehow predict what our expenses

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Speaker 2: are going to be for the following twelve months. And

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Speaker 2: some of the larger companies and when we say large

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Speaker 2: for our world and really in the general marketplace, let's

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Speaker 2: say twenty five fifty seventy five trucks, one hundred trucks

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Speaker 2: that are everywhere all over this country, they are facing

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Speaker 2: pressure to take on some of the insurance. And think

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Speaker 2: more like some of the publicly traded companies that for years,

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Speaker 2: if you walk into some of these lea they have

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Speaker 2: full safety risk management teams, they have in house adjusters.

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Speaker 2: When they face a loss, they are out there trying

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Speaker 2: to settle and try to keep that claim as low

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Speaker 2: as possible. As Tom alluded to the marketplace for one

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Speaker 2: to ten units, I mean if you really get down

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Speaker 2: to the numbers, it's ninety seven percent of the industry

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Speaker 2: and the number of MC numbers four higher are in

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Speaker 2: that one to ten space. They can't afford to take

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Speaker 2: on a deductible, so they are really getting squeezed on

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Speaker 2: the insurance and facing these astronomical increases at times, you know,

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Speaker 2: and I think the industry has think what do we

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Speaker 2: do to you know, to combat that, how do we

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Speaker 2: make you know, the the industry really think that, Okay,

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Speaker 2: these one to tens are thinking wanted to be as

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Speaker 2: safe as a thousand unit trucking company. Those are very

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Speaker 2: difficult decisions.

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Speaker 1: Right roughly speaking, because I know it depends on so

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Speaker 1: many different inputs, but like what is the average one

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Speaker 1: million dollar policy? What does it cost an owner operator

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Speaker 1: that's not taking a deductible? And they know, like just

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Speaker 1: like a broad you can give me like a range

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Speaker 1: you can drive through if you want, but like, just

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Speaker 1: broadly speaking, we're talking thousands of dollars, tens of thousand dollars,

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Speaker 1: like fifty thousand dollars, one hundred thousand dollars.

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Speaker 2: It's not fifty, but really it goes by you know,

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Speaker 2: we can actually get pretty with the number carriers. As

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Speaker 2: Tom alluded to, we have about ten thousand customers and

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Speaker 2: they're all across the board, and what we try to

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Speaker 2: do as an agency is break that down. It's pretty

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Speaker 2: interesting because I will give you a range because if

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Speaker 2: you were here in Chattanooga, Tennessee, and it's Tom and

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Speaker 2: Andrew Trucking, our premiums might be for just liability seven

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Speaker 2: to nine thousand dollars we're a good operator. Then you

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Speaker 2: have the physical damage in cargoes. So let's say we're

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Speaker 2: paying twelve to thirteen thousand dollars per truck per year.

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Speaker 2: If we were based in New York, that may be

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Speaker 2: twenty three to twenty five thousand. If we're based in

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Speaker 2: you know, the Midwest and rural Midwest, it might be

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Speaker 2: six to eight total. You know, it varies by region.

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Speaker 2: That's been a big thing with the insurance industry and

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Speaker 2: kind of what we've seen with the companies is where

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Speaker 2: you're based and where your routes and where you run

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Speaker 2: greatly depicts the premium that you are paying based off

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Speaker 2: verdicts and what they're seeing. So it's more on the

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Speaker 2: verdicts right.

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Speaker 3: Well, and also too, if a carrier does hasmat that's

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Speaker 3: going to factor into the cost as well. We have

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Speaker 3: different dashboards and our system average excluding our intra state

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Speaker 3: customers is about eleven trucks. If you throw in the interstate,

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Speaker 3: it drops in size just a little bit. But a

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Speaker 3: lot of that smallness is because we have all of

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Speaker 3: our new agents generally the first year focus on one

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Speaker 3: to nine trucks, and then as they get established they

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Speaker 3: may move up and focus on twenty to fifty or

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Speaker 3: whatever their niche becomes longer term. But the highest I've

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Speaker 3: heard on the floor, just as a fun story, is

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Speaker 3: about thirty seven thousand dollars. I remember an agent quoting,

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Speaker 3: and I don't know if we got that business or not,

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Speaker 3: but we look at it in terms of the cost

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Speaker 3: per truck, which is the way the operators look at

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Speaker 3: it as well.

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Speaker 1: And you know, because of the trucking market's been I

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Speaker 1: guess we could say in the toilet for the last

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Speaker 1: three years and the higher cost of insurance. Are our

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Speaker 1: owner operators or small fleets. Are they able to trade

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Speaker 1: down or the only trading down would be taking a

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Speaker 1: deductible But you said that the smaller guys aren't doing

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Speaker 1: that at all. So like our carriers able to trade

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Speaker 1: down on their insurance.

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Speaker 2: Do you mean get decreases at renewal typically or are

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Speaker 2: we seeing any.

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Speaker 1: No, like, are they taking less coverage because I know

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Speaker 1: you mentioned that. Yeah, we're structuring it where it costs

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Speaker 1: them less money.

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Speaker 2: I will say one area that we have seen is

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Speaker 2: you know, and it's kind of interesting to watch, right,

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Speaker 2: so there's nothing out of more than a fan owned

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Speaker 2: trucking business. Like to me, that's a backbone of America.

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Speaker 2: Everything we have, the headsets, we're wearing. Everything arrives on

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Speaker 2: wheels right end of the day in America. That's the

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Speaker 2: way it works. Even if it gets somewhere by rail,

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Speaker 2: it's probably going to move on wheels to the store

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Speaker 2: and to get to its final place. And I have

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Speaker 2: seen and it's kind of a it's interesting. I want

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Speaker 2: to be careful saying it, but we have seen kind

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Speaker 2: of those companies and to trend down, I would say

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Speaker 2: limiting maybe the excess umbrella coverage. They have the excess

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Speaker 2: umbrella market. So let's say companies that are over ten

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Speaker 2: trucks and rediscuss the highlighted nuclear verdicts and that's what

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Speaker 2: everyone sees in the news, which I'm sure we'll get

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Speaker 2: in topic later with some of the two that happened

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Speaker 2: recently with some driver issues, and but we have seen

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Speaker 2: that market is tightened drastically. So if I come to

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Speaker 2: you Lee with you were paying ten thousand dollars per

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Speaker 2: truck last year, Let's say you get a renewal at

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Speaker 2: twelve five, that's not out of the world to see

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Speaker 2: a twenty five percent increase. And let's say you had

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Speaker 2: a one million dollar umbrella or access policy that was

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Speaker 2: to two thousand dollars a truck as well. And you're going, wow,

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Speaker 2: my last three years, my rate per mile is either

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Speaker 2: flat or it's actually down ten or fifteen cents. We

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Speaker 2: can't afford to operate with a twenty five percent primary

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Speaker 2: insurance renewal. And you're telling me my excess, my one

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Speaker 2: ex of one so I have two million total, is

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Speaker 2: also going to increase another ten or fifteen percent. You

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Speaker 2: know what, I'll just buy the one million because my

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Speaker 2: one million primary is now the same cost as what

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Speaker 2: it was to purchase two last year. We are seeing

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Speaker 2: companies basically reduce the amount of umbrella they have to

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Speaker 2: try to keep the insurance spend in line. And I

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Speaker 2: think that's That's something that we try to highlight because

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Speaker 2: people you know, as kind of producers in this world

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Speaker 2: and retail insurance brokers. I think what helped is bringing

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Speaker 2: Tom in. We have to look at the total spend

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Speaker 2: of all insurance. I don't care if you're one truck,

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Speaker 2: fifteen hundred trucks, I don't care. Like you have to

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Speaker 2: look at the revenue you're generating per mile, the cost

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Speaker 2: of equipment that if you're getting new equipment, it's much higher.

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Speaker 2: I mean I used to ensure sleepers for ninety five

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Speaker 2: thousand dollars, you know, and now they're one hundred and

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Speaker 2: seventy five thousand dollars. Well, guess what some of those

296
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Speaker 2: companies the revenue is about the same. So these operators

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Speaker 2: have these huge inflationary pressures and every piece of their business,

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Speaker 2: but yet they're still generating almost the same rate per mile,

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Speaker 2: which is a whole other issue. And then we're having

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Speaker 2: to deliver these insurance increases for people that you know

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Speaker 2: some I mean they're business relationships, but they're friends, right,

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Speaker 2: We've grown together, We've seen businesses grow together, and it's like, hey, Andrew,

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Speaker 2: how do I protect myself and our family? But all

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Speaker 2: of a sudden, I'm paying the same thing for one

305
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Speaker 2: million dollars in insure and said I was paying for

306
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Speaker 2: five ten years ago, and I'm still generating the same

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Speaker 2: rate per mile. I'm paying more for my equipment, more

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Speaker 2: for my drivers, more for my staff, you know, and

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Speaker 2: I put in everything that this industry wants me to

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Speaker 2: do with cameras and you know, any type of you know,

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Speaker 2: additional cameras. Now you have the trailer cameras that you know,

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Speaker 2: the kind of the side view cameras on the mirrors.

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Speaker 2: They're investing all these dollars, but yet the insurance premiums

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Speaker 2: continue to go up and up and up. So how

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Speaker 2: do they face it? And it's either what you said,

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Speaker 2: maybe they reduce the excess umbrella limits, maybe they take

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Speaker 2: on more deductible That's really the only thing they're able

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Speaker 2: to do to try to really address kind of the

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Speaker 2: insurance premiums that we're seeing go up your end in

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Speaker 2: your out well.

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Speaker 3: And sometimes I will hear too that, like on the

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Speaker 3: cargo coverage, they might be willing to tolerate a few

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Speaker 3: more exceptions to non coverage.

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Speaker 1: What does that mean? Let's lets for those that aren't

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Speaker 1: in tune with insurance. What does that mean?

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Speaker 3: So let's say you know your business, you're hauling copper,

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Speaker 3: but then the increase that comes through on cargo, you're like, well.

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Speaker 2: We won't have that covered.

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Speaker 3: We'll either assume that risk, or we'll try to find

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Speaker 3: some other customers that don't do copper or other commodities.

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Speaker 3: That's probably an oversimplified example. Or they might on their

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Speaker 3: physical damage put a cap on their towing cost whereas

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Speaker 3: before they had broader coverage. Again, as long as you

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Speaker 3: don't have a problem, it doesn't come to bite you.

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Speaker 3: But you've essentially bought down in coverage a little bit,

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Speaker 3: and so I think there's a lot of scrambling that

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Speaker 3: does go on.

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Speaker 1: Does this sort of coverage the coverage you guys sell

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Speaker 1: doesn't include theft?

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Speaker 2: So that's important right now, and it's it's obviously becoming

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Speaker 2: increasingly more and more of a problem, and that's there's

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Speaker 2: different ways to interpret it. And also the cyber that

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Speaker 2: we're seeing on fictitious carriers and phishing attempts that we

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Speaker 2: see out there. So that's kind of a growing pressure

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Speaker 2: which people kind of I think when you read articles

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Speaker 2: generally speaking, that's all kind of a theft, right, everybody

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Speaker 2: thinks of it theft, but it could be through phishing

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Speaker 2: and more of a cyber attack and paring to be

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Speaker 2: a carrier that you're not. And then also probably on

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Speaker 2: the insurance side, what I look at is true motor

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Speaker 2: truck cargo theft. So it's becoming even more and more

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Speaker 2: difficult or even more important for all the operators that

353
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Speaker 2: are listening to make sure that there's a lot of

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Speaker 2: great insurance brokers out there in transportation, but make sure

355
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Speaker 2: that they are specialists and understand kind of what you're doing,

356
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Speaker 2: because those are areas that there are forms out there

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Speaker 2: that specifically exclude theft. And sometimes we see that with insurance,

358
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Speaker 2: especially in motor truck cargo, that people aren't aware of

359
00:19:49,480 --> 00:19:52,280
Speaker 2: and they just purchase the least expensive option, right because

360
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Speaker 2: people are trying to save money. Well, all of a sudden,

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Speaker 2: I always tell a lot of our producers in the

362
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Speaker 2: house the biggest problems I've ever had as I've learned

363
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Speaker 2: throughout this industry, and we all still can miss things

364
00:20:04,920 --> 00:20:07,560
Speaker 2: at times, but as always, the cargo and when you're

365
00:20:07,560 --> 00:20:10,199
Speaker 2: purchasing insurance, so Lee, when I come to you for

366
00:20:10,280 --> 00:20:13,080
Speaker 2: your renewal, your cargo and gl are going to be

367
00:20:13,720 --> 00:20:16,400
Speaker 2: the least amount of your premium. If you own the equipment,

368
00:20:16,440 --> 00:20:20,040
Speaker 2: your liability is majority of the costs physical damage, second cargo,

369
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Speaker 2: then general liability. Those are kind of the four main items,

370
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Speaker 2: and then work comp if you have w two employees,

371
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Speaker 2: but if not, those are the big four. Especially for

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Speaker 2: the general marketplace and transportation, you have to pay attention

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Speaker 2: to the cargo forms because there are a lot of

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Speaker 2: theft exclusions. There's a lot of different wardings out there,

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Speaker 2: and the buyers just need to be sure that they're

376
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Speaker 2: with the right people that are explaining it, getting a

377
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Speaker 2: list of what's excluded, what's included to combat some of

378
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Speaker 2: these and also how the forms are interpreted, especially if

379
00:20:52,680 --> 00:20:56,480
Speaker 2: your freight comes from load boards. Are you direct with shippers?

380
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Speaker 2: Just little things that can be asked and safe possibly

381
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Speaker 2: your business, because there's nothing worse than meeting someone or

382
00:21:05,119 --> 00:21:07,639
Speaker 2: reworked an account, maybe we didn't get it, and then

383
00:21:07,680 --> 00:21:09,359
Speaker 2: all of a sudden they have a claim because they

384
00:21:09,400 --> 00:21:12,639
Speaker 2: bought coverage that they thought they had and they didn't.

385
00:21:12,840 --> 00:21:15,720
Speaker 2: And guess what when a shipper or someone comes after

386
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Speaker 2: you leave for fifty or one hundred or one hundred

387
00:21:18,480 --> 00:21:22,160
Speaker 2: and fifty thousand dollars, which I mean cargo now almost

388
00:21:22,200 --> 00:21:24,879
Speaker 2: two fifty is becoming standard over the old one hundred.

389
00:21:25,320 --> 00:21:28,000
Speaker 2: Just due to the cost of goods. You're out of

390
00:21:28,000 --> 00:21:30,679
Speaker 2: business and that's sad to see. So I think theft

391
00:21:30,800 --> 00:21:34,160
Speaker 2: is it can be addressed, but you will pay more.

392
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Speaker 2: But in the grand scheme of things, it's it's not

393
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Speaker 2: as much as what you think for the potential repercussions

394
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Speaker 2: if it's not providing the policy that you purchase.

395
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Speaker 1: You mentioned that like these sort of things can put

396
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Speaker 1: a small business or owner operator out of business. You know,

397
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Speaker 1: given the court verdicts that we've seen, is a million

398
00:21:54,359 --> 00:21:58,399
Speaker 1: dollars of coverage? Really enough? Are you seeing a lot more?

399
00:21:59,200 --> 00:22:02,280
Speaker 1: Trucking company is kind of closing their doors because of

400
00:22:02,680 --> 00:22:06,159
Speaker 1: a lawsuit that comes their way. I guess more so

401
00:22:06,359 --> 00:22:09,399
Speaker 1: recently than you haven't during your career.

402
00:22:10,680 --> 00:22:13,320
Speaker 2: I mean, I think so. I think it's more. It's

403
00:22:13,400 --> 00:22:18,199
Speaker 2: kind of by I mean, you're seeing it because the

404
00:22:18,280 --> 00:22:20,680
Speaker 2: amount of the claims and where the claims are settling

405
00:22:20,880 --> 00:22:23,920
Speaker 2: is a direct relation to the renewal premiums that you're seeing.

406
00:22:23,960 --> 00:22:26,240
Speaker 2: So as these costs go up, it's not unheard up

407
00:22:26,240 --> 00:22:28,199
Speaker 2: to see some of these, or get accounts that are

408
00:22:28,240 --> 00:22:32,159
Speaker 2: getting fifty hundred percent insurance increases on the back end,

409
00:22:32,240 --> 00:22:37,240
Speaker 2: especially if it's very important. Everyone's looking at CABS, CSA

410
00:22:37,400 --> 00:22:42,159
Speaker 2: scores like protecting and your resume is everything now in

411
00:22:42,160 --> 00:22:45,480
Speaker 2: this insurance marketplace, whereas in the past some of the

412
00:22:45,560 --> 00:22:48,280
Speaker 2: large fleets has tom alluded to that are being self insured,

413
00:22:48,320 --> 00:22:50,760
Speaker 2: they're being truly loss rated. So I would take your

414
00:22:50,760 --> 00:22:54,760
Speaker 2: five year historical losses trading dollars. You know, if you

415
00:22:54,840 --> 00:22:57,879
Speaker 2: pay a million in your average three hundred thousand a

416
00:22:57,960 --> 00:22:59,800
Speaker 2: year in claims the last five years, you're a good

417
00:22:59,840 --> 00:23:02,239
Speaker 2: rich It's hard to do on a small fleet if

418
00:23:02,240 --> 00:23:05,480
Speaker 2: you're paying ten or twelve five as the example are provided. Earlier,

419
00:23:06,359 --> 00:23:09,199
Speaker 2: you were in me at a red light. All right,

420
00:23:09,240 --> 00:23:11,360
Speaker 2: there's gonna be damage to my car. Well, guess what,

421
00:23:11,480 --> 00:23:14,159
Speaker 2: maybe I go and play basketball that afternoon and then

422
00:23:14,200 --> 00:23:16,840
Speaker 2: someone's I see a billboard and you're like, you know what,

423
00:23:16,880 --> 00:23:19,159
Speaker 2: I tweaked my back? Did that happen in basketball or

424
00:23:19,160 --> 00:23:22,000
Speaker 2: did it happen in the accident. I'll say the accident.

425
00:23:22,640 --> 00:23:25,879
Speaker 2: The insurance company pays twenty five thousand just to avoid

426
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Speaker 2: going to court. Well, then all of a sudden, how

427
00:23:28,840 --> 00:23:31,080
Speaker 2: are they going to recoup that money? They just lost

428
00:23:31,200 --> 00:23:34,000
Speaker 2: one hundred percent on your wrist. So I think that

429
00:23:34,000 --> 00:23:37,560
Speaker 2: that passed down in the insurance premiums is causing a

430
00:23:37,640 --> 00:23:40,680
Speaker 2: lot of carriers to shut the door. The other example

431
00:23:40,760 --> 00:23:43,560
Speaker 2: was kind of this traditional mid market as we'll call it.

432
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Speaker 2: Let's just say twenty five to two hundred trucks that

433
00:23:46,000 --> 00:23:49,880
Speaker 2: are decreasing their premium. You know, to tell the truth,

434
00:23:49,880 --> 00:23:52,080
Speaker 2: sometimes you hear, well, if I have a million, that's

435
00:23:52,119 --> 00:23:54,600
Speaker 2: what they'll go after. If they increase the limits of

436
00:23:54,680 --> 00:23:57,280
Speaker 2: two million, that's what they'll go after. And I think

437
00:23:57,359 --> 00:24:00,840
Speaker 2: that's you know, there's this big We do a seminar

438
00:24:00,880 --> 00:24:03,119
Speaker 2: every year and we try to bring in operators and

439
00:24:03,760 --> 00:24:07,159
Speaker 2: insurance executives to really get down because it's always interesting

440
00:24:07,720 --> 00:24:11,160
Speaker 2: to me to see where kind of what you hear

441
00:24:11,200 --> 00:24:14,719
Speaker 2: from the everyday trucker is I want to fight this

442
00:24:14,880 --> 00:24:17,359
Speaker 2: fifty thousand dollars loss because I think it should be

443
00:24:17,400 --> 00:24:22,040
Speaker 2: twenty And then there's this battle right between who we're

444
00:24:22,040 --> 00:24:25,280
Speaker 2: purchasing insurance from and the operator. And then all of

445
00:24:25,320 --> 00:24:27,760
Speaker 2: a sudden, if it settles for seventy five, if reincrease

446
00:24:27,840 --> 00:24:30,440
Speaker 2: the limits to two million, which would be difficult because,

447
00:24:30,480 --> 00:24:32,800
Speaker 2: as we said, a lot of the marketplace for four

448
00:24:32,920 --> 00:24:36,960
Speaker 2: higher carriers is under twenty units. And those insurance companies

449
00:24:36,960 --> 00:24:39,680
Speaker 2: that quote that may or may they probably don't want

450
00:24:39,720 --> 00:24:42,200
Speaker 2: the two million fully at risks all of a sudden

451
00:24:42,200 --> 00:24:45,440
Speaker 2: they're having to purchase an excess umbrella. What is the

452
00:24:45,520 --> 00:24:48,119
Speaker 2: right premium for that? But is how do we know

453
00:24:48,160 --> 00:24:51,600
Speaker 2: if reincrease those limits that the fifty thousand dollars claim

454
00:24:51,600 --> 00:24:54,000
Speaker 2: are the twenty five thousand dollars claim lead from you

455
00:24:54,119 --> 00:24:58,119
Speaker 2: hitting me, well, if there's two million, now, maybe I

456
00:24:58,160 --> 00:25:00,720
Speaker 2: can get fifty from you or seven because you're like,

457
00:25:00,960 --> 00:25:02,760
Speaker 2: you know what, did these a lot better in paying

458
00:25:03,200 --> 00:25:05,600
Speaker 2: a million too? You know? And I think those are

459
00:25:05,640 --> 00:25:09,080
Speaker 2: things that our industry has continue to face and fight.

460
00:25:09,840 --> 00:25:12,800
Speaker 2: I think there's some states with some good tort reform

461
00:25:12,840 --> 00:25:14,760
Speaker 2: that's come out that will help, but that's going to

462
00:25:14,800 --> 00:25:17,119
Speaker 2: take time, So there's not This is just something that

463
00:25:17,200 --> 00:25:21,159
Speaker 2: I think, unfortunately the trucking companies in America and that

464
00:25:21,280 --> 00:25:23,679
Speaker 2: to face for the next number of years is how

465
00:25:23,720 --> 00:25:26,560
Speaker 2: to recombat these rising insurance premiums.

466
00:25:27,000 --> 00:25:30,320
Speaker 1: Yeah, it's pretty interesting how many billboards and commercials you

467
00:25:30,400 --> 00:25:34,280
Speaker 1: see for lawyers trying to go after trucking companies. I

468
00:25:34,359 --> 00:25:36,359
Speaker 1: was in Dallas earlier this week and there was a

469
00:25:36,400 --> 00:25:38,720
Speaker 1: guy standing on top of a truck yelling with a

470
00:25:38,760 --> 00:25:42,239
Speaker 1: hedge with a sledgehammer and a cowboy hat about how

471
00:25:42,280 --> 00:25:45,840
Speaker 1: he's going to fight for people. So it was it's

472
00:25:45,920 --> 00:25:47,679
Speaker 1: pretty pretty crazy, and tell them, what were you going

473
00:25:47,720 --> 00:25:47,960
Speaker 1: to say?

474
00:25:47,960 --> 00:25:48,439
Speaker 2: Sorry about that?

475
00:25:48,440 --> 00:25:51,680
Speaker 3: Well, I was going to say the nuclear verdicts. They

476
00:25:51,800 --> 00:25:56,160
Speaker 3: get the headlines a lot, but really and that will

477
00:25:56,200 --> 00:26:00,439
Speaker 3: continue for the reasons that Andrew described, but the nature

478
00:26:01,200 --> 00:26:04,600
Speaker 3: nuclear verdicts, which I would define as between two million

479
00:26:04,640 --> 00:26:07,240
Speaker 3: and up to ten million, that there's been a lot

480
00:26:07,240 --> 00:26:11,560
Speaker 3: of growth there. And then, as Andrew alluded to things

481
00:26:11,560 --> 00:26:15,200
Speaker 3: that might have cost forty thousand dollars maybe a broken

482
00:26:15,280 --> 00:26:20,200
Speaker 3: leg and time off plus some other bills, you know,

483
00:26:20,440 --> 00:26:22,879
Speaker 3: now it might go for one hundred and fifty thousand

484
00:26:22,960 --> 00:26:26,920
Speaker 3: dollars just six or seven years later. So the attorneys

485
00:26:26,920 --> 00:26:32,000
Speaker 3: have gotten really good and securing awards that and we

486
00:26:32,119 --> 00:26:35,320
Speaker 3: had an attorney at our seminar that Andrew alluded to

487
00:26:35,480 --> 00:26:37,359
Speaker 3: last year, and I've spent a lot of time talking

488
00:26:37,400 --> 00:26:41,040
Speaker 3: to her on what the plane off's attorney's strategies are

489
00:26:41,040 --> 00:26:46,840
Speaker 3: and how they build empathy with juries and part of

490
00:26:46,840 --> 00:26:50,760
Speaker 3: it is. They will throw out these big numbers associated

491
00:26:50,800 --> 00:26:53,919
Speaker 3: with like the cost of a Boeing airplane or some

492
00:26:54,119 --> 00:26:58,240
Speaker 3: famous lawsuit or the building of a building, and then

493
00:26:58,880 --> 00:27:03,760
Speaker 3: that association they'll make that request for two hundred and

494
00:27:03,760 --> 00:27:07,719
Speaker 3: fifty thousand dollars it seems like pennies compared to what

495
00:27:07,760 --> 00:27:11,200
Speaker 3: they've just planted in the jury's mines. Or they'll talk

496
00:27:11,240 --> 00:27:15,000
Speaker 3: about some new product from Apple and the cost that

497
00:27:15,119 --> 00:27:18,919
Speaker 3: it took to how much research and development went in

498
00:27:18,920 --> 00:27:22,640
Speaker 3: that has nothing to do with trucking, and it starts

499
00:27:22,640 --> 00:27:27,600
Speaker 3: to create a very sympathetic jury, like, well, heck, this guy,

500
00:27:27,680 --> 00:27:31,200
Speaker 3: you know, not only broke his leg, but you know,

501
00:27:31,400 --> 00:27:35,959
Speaker 3: his shoulders injured and his back's bothering him. And what

502
00:27:36,080 --> 00:27:39,439
Speaker 3: would have been a completely different verdict, a different a

503
00:27:39,480 --> 00:27:43,240
Speaker 3: decade ago now is worth four or five hundred percent more.

504
00:27:43,560 --> 00:27:45,360
Speaker 3: It's it's the craziest thing.

505
00:27:46,200 --> 00:27:50,640
Speaker 1: When we're comparing apples to apples for insurance. Roughly, how

506
00:27:50,720 --> 00:27:55,760
Speaker 1: much did insurance costs go up for the average owner

507
00:27:55,800 --> 00:27:59,879
Speaker 1: operator this year and maybe last year, and kind of

508
00:28:00,200 --> 00:28:02,080
Speaker 1: are you expecting more of the same next year?

509
00:28:02,560 --> 00:28:04,960
Speaker 2: I would say this last year was ten to fifteen

510
00:28:05,119 --> 00:28:09,800
Speaker 2: percent kind of across the board. I will say I

511
00:28:09,840 --> 00:28:15,440
Speaker 2: think next year twenty twenty six, there's been some unfortunately

512
00:28:15,520 --> 00:28:18,560
Speaker 2: some carriers that are getting out of the transportation market,

513
00:28:18,640 --> 00:28:22,320
Speaker 2: and I think you will see I think carriers could

514
00:28:22,320 --> 00:28:26,320
Speaker 2: see a minimum of probably closer fifteen to twenty five

515
00:28:26,480 --> 00:28:28,639
Speaker 2: across the board if they were just going to stay.

516
00:28:28,680 --> 00:28:33,719
Speaker 2: That's a guaranteed cost type thought processingly, So I think

517
00:28:33,760 --> 00:28:36,000
Speaker 2: it's going to be very important for everyone out there

518
00:28:36,000 --> 00:28:39,200
Speaker 2: to make sure that you know you're ahead of your renewals,

519
00:28:39,400 --> 00:28:41,720
Speaker 2: you're with the right people, with the right market approach.

520
00:28:41,760 --> 00:28:44,360
Speaker 2: And you know the problem with that is when they

521
00:28:44,840 --> 00:28:48,720
Speaker 2: when they hear this is all of a sudden, you

522
00:28:48,720 --> 00:28:51,640
Speaker 2: know a problem with our industry is last minute. You

523
00:28:51,640 --> 00:28:53,760
Speaker 2: know it would frustrate you, Lee, I mean if you

524
00:28:54,160 --> 00:28:55,400
Speaker 2: the only thing I know to equate it to, if

525
00:28:55,400 --> 00:28:57,840
Speaker 2: you're not buying trucking the churance. Imagine if your homeowners

526
00:28:57,840 --> 00:29:03,120
Speaker 2: and personal auto came the last day, right before your

527
00:29:03,160 --> 00:29:06,000
Speaker 2: renewal and you're getting twenty thirty percent increases your home

528
00:29:06,000 --> 00:29:08,400
Speaker 2: owners goes two to four, You're going to be pretty

529
00:29:08,400 --> 00:29:10,920
Speaker 2: pissed off. I mean, that's so all of a sudden.

530
00:29:10,920 --> 00:29:13,920
Speaker 2: You relate that to these trucking companies and as we said,

531
00:29:13,920 --> 00:29:16,320
Speaker 2: if it's let's just say thirteen thousand, I bet if

532
00:29:16,360 --> 00:29:19,840
Speaker 2: you took a blended rate of our one to four units,

533
00:29:19,880 --> 00:29:22,840
Speaker 2: I bet the average liability premium is probably third. I

534
00:29:22,840 --> 00:29:25,320
Speaker 2: think it's like thirteen seven. But that's probably something I'm

535
00:29:25,320 --> 00:29:28,800
Speaker 2: just pulling out of one of the gazillion power points

536
00:29:28,800 --> 00:29:30,400
Speaker 2: I've seen. But let's just say that just for a

537
00:29:30,480 --> 00:29:33,880
Speaker 2: primary one million, liability is a general average. All of

538
00:29:33,920 --> 00:29:37,000
Speaker 2: a sudden, you come back with sixteen seventeen thousand. That

539
00:29:37,120 --> 00:29:40,000
Speaker 2: is huge for you because you are an entrepreneur driving

540
00:29:40,080 --> 00:29:43,240
Speaker 2: one to five trucks. So then you just multiply it, right,

541
00:29:43,320 --> 00:29:46,600
Speaker 2: I mean generally speaking, for the first one hundred units,

542
00:29:46,640 --> 00:29:49,120
Speaker 2: this is how you buy insurance. So that is a

543
00:29:49,240 --> 00:29:52,760
Speaker 2: drastic increase for these operators. So I think you know,

544
00:29:52,840 --> 00:29:55,840
Speaker 2: the natural reaction is I'm going to shop last minute

545
00:29:55,880 --> 00:29:58,960
Speaker 2: and get a less expensive quote, which ends up happening.

546
00:29:59,240 --> 00:30:00,960
Speaker 2: All right, what is the coverage form when it's a

547
00:30:00,960 --> 00:30:04,520
Speaker 2: policy form? I bought it. It was emotional purchase because

548
00:30:04,560 --> 00:30:08,320
Speaker 2: I'm trying to save dollars, trying to operate. Oh no,

549
00:30:08,400 --> 00:30:12,920
Speaker 2: I accidentally bought a cargo form that specifically excludes theft, right,

550
00:30:13,000 --> 00:30:16,040
Speaker 2: and then you're dealing with all these other issues by

551
00:30:16,080 --> 00:30:18,840
Speaker 2: the way the company operates, you know, and it's it

552
00:30:18,920 --> 00:30:21,320
Speaker 2: goes back to your billboards. It makes me sick. I

553
00:30:21,400 --> 00:30:23,240
Speaker 2: have to drive to Atlanta a few times a week

554
00:30:23,240 --> 00:30:27,280
Speaker 2: occasionally billboards everywhere, you know, and I sit there and go,

555
00:30:27,480 --> 00:30:30,480
Speaker 2: you know, as an entrepreneur, like, this must cost a fortune,

556
00:30:31,040 --> 00:30:34,280
Speaker 2: right if we're all in business, And I'm like, is

557
00:30:34,760 --> 00:30:37,680
Speaker 2: my money well spent on thousands and thousands of dollars

558
00:30:37,760 --> 00:30:41,000
Speaker 2: monthly to have seventy five billboards in state of Georgia

559
00:30:41,120 --> 00:30:44,120
Speaker 2: or Texas. You know, you have litigation funding out there

560
00:30:44,160 --> 00:30:45,960
Speaker 2: that's backing some of this. I think there has to

561
00:30:45,960 --> 00:30:48,960
Speaker 2: be a crackdown on it. And I think the perception

562
00:30:49,080 --> 00:30:51,720
Speaker 2: of trucking I think, you know, waking up every day

563
00:30:51,760 --> 00:30:55,200
Speaker 2: we're here, I mean news is news, I mean take

564
00:30:55,240 --> 00:30:58,400
Speaker 2: it as what it is. People kind of put out

565
00:30:58,440 --> 00:31:00,960
Speaker 2: their own narrative at times. But the cost of good

566
00:31:01,080 --> 00:31:04,440
Speaker 2: you do here at the American family struggling. But as

567
00:31:04,440 --> 00:31:07,600
Speaker 2: we said earlier in this podcast, everything comes in on wills.

568
00:31:08,080 --> 00:31:10,480
Speaker 2: And I think the general perception is I don't think

569
00:31:10,480 --> 00:31:13,600
Speaker 2: if you walk into any of these trucking companies and

570
00:31:13,680 --> 00:31:15,880
Speaker 2: if they are ever at fault in an accident. They

571
00:31:17,560 --> 00:31:20,960
Speaker 2: want to take care of whatever happened in that claim

572
00:31:20,960 --> 00:31:24,040
Speaker 2: that they're at fault. The only thing that's upsetting about

573
00:31:24,040 --> 00:31:26,960
Speaker 2: this industry is and I've had two or three this

574
00:31:27,080 --> 00:31:29,880
Speaker 2: year in thank goodness, and I think the single greatest

575
00:31:29,880 --> 00:31:31,960
Speaker 2: thing that I've seen in our industry is the forward

576
00:31:32,000 --> 00:31:35,840
Speaker 2: facing cameras, because all of a sudden, I've had multiple

577
00:31:35,880 --> 00:31:38,640
Speaker 2: claims where a driver is not paying attention and no

578
00:31:38,680 --> 00:31:42,320
Speaker 2: one takes responsibility for their own actions anymore. How are

579
00:31:42,360 --> 00:31:45,560
Speaker 2: you going to sue my client if you just switch

580
00:31:45,680 --> 00:31:49,680
Speaker 2: three lanes without even paying attention and hit our tractor,

581
00:31:50,240 --> 00:31:53,440
Speaker 2: you know, and without that that could have been that's

582
00:31:53,520 --> 00:31:56,520
Speaker 2: easily a six figure loss. You know. Unfortunately you get

583
00:31:56,560 --> 00:31:59,120
Speaker 2: out of it. But I think the general perception is like, hey,

584
00:31:58,920 --> 00:32:01,760
Speaker 2: they want to take care of the general public. That's

585
00:32:01,760 --> 00:32:04,280
Speaker 2: why it's there, you know. But it's going to take

586
00:32:04,320 --> 00:32:07,280
Speaker 2: a lot of people enforcing some of the latest you know,

587
00:32:07,320 --> 00:32:09,400
Speaker 2: the administration has been on a number of things and

588
00:32:10,280 --> 00:32:13,360
Speaker 2: really trying to push certain things to make the industry

589
00:32:13,440 --> 00:32:16,880
Speaker 2: safer after the two really losses that unfortunately, it took

590
00:32:16,920 --> 00:32:20,000
Speaker 2: those to really catch national news in Florida and California

591
00:32:20,080 --> 00:32:24,360
Speaker 2: with the drivers legal drivers. But you know, it's those

592
00:32:24,400 --> 00:32:26,560
Speaker 2: factors where it's like, I think the general public has

593
00:32:26,600 --> 00:32:29,040
Speaker 2: come into perception that these are people they want to

594
00:32:29,120 --> 00:32:31,600
Speaker 2: run a good business. If one of the three of

595
00:32:31,680 --> 00:32:35,240
Speaker 2: us had five hundred pieces of equipment out there running

596
00:32:35,240 --> 00:32:37,360
Speaker 2: even general cars, we're gonna have a lot of accidents.

597
00:32:37,360 --> 00:32:39,480
Speaker 2: It might not cause as big of a loss. But

598
00:32:39,520 --> 00:32:41,840
Speaker 2: if we're it falled every single time, and we're having

599
00:32:41,880 --> 00:32:45,520
Speaker 2: to pay thousands and thousands, sometimes millions of dollars for

600
00:32:45,760 --> 00:32:48,920
Speaker 2: things that maybe our employee was doing right, but just

601
00:32:48,960 --> 00:32:54,120
Speaker 2: because we drove, you know, a Tahoe against a Volkswagen Jetta.

602
00:32:54,600 --> 00:32:57,440
Speaker 2: I think Volkswagen Jetta still exists, but if it was,

603
00:32:57,600 --> 00:33:00,920
Speaker 2: like you know, I mean, that's it's difficult to want

604
00:33:00,960 --> 00:33:02,719
Speaker 2: to keep operating because we're trying to do the right

605
00:33:02,760 --> 00:33:05,640
Speaker 2: thing and make a living and deliver it everyday goods

606
00:33:05,640 --> 00:33:07,720
Speaker 2: that we use and we sit here in the industry

607
00:33:07,840 --> 00:33:11,400
Speaker 2: just constantly. I mean, I think that's what we see

608
00:33:11,440 --> 00:33:14,480
Speaker 2: the most from the ownership of these truck lines. It's

609
00:33:14,520 --> 00:33:18,320
Speaker 2: like it's just one thing after another, and the insurance

610
00:33:18,400 --> 00:33:21,120
Speaker 2: unfortunately that I mean, we love what we do. We're

611
00:33:21,160 --> 00:33:24,800
Speaker 2: passionate about it, but we also realize this is a

612
00:33:24,960 --> 00:33:29,160
Speaker 2: huge expense and it needs to be you know, four

613
00:33:29,280 --> 00:33:31,800
Speaker 2: or five. But for some of these companies, insurance is

614
00:33:31,840 --> 00:33:35,000
Speaker 2: the largest expense and it's a second you know, and

615
00:33:35,440 --> 00:33:37,840
Speaker 2: what can we do? And I think there's really good

616
00:33:38,040 --> 00:33:40,960
Speaker 2: there's great operators, and there's bad operators in every business.

617
00:33:41,600 --> 00:33:44,360
Speaker 2: And some of the things and legislation and kind of

618
00:33:44,360 --> 00:33:46,959
Speaker 2: the agendas of the current administration that they're passing, I

619
00:33:46,960 --> 00:33:49,040
Speaker 2: think hopefully we'll clean that up some.

620
00:33:49,600 --> 00:33:51,680
Speaker 3: I wanted to just share an example of how that

621
00:33:52,000 --> 00:33:55,240
Speaker 3: hits inflation. So one of the shippers that was at

622
00:33:55,360 --> 00:33:59,360
Speaker 3: our symposium I haven't told Andrew this story yet, called

623
00:33:59,400 --> 00:34:02,800
Speaker 3: me at the be this week. They're a private company,

624
00:34:02,840 --> 00:34:05,640
Speaker 3: but they got hit with a nuclear verdict of over

625
00:34:05,680 --> 00:34:11,000
Speaker 3: twenty million dollars and so their general counsel now is

626
00:34:11,040 --> 00:34:14,719
Speaker 3: saying that every motor carrier needs to have twenty five

627
00:34:14,760 --> 00:34:19,200
Speaker 3: million dollars coverage. And I was like, well, good luck

628
00:34:19,239 --> 00:34:21,560
Speaker 3: with that. You're not going to have hardly any carriers.

629
00:34:21,600 --> 00:34:25,839
Speaker 3: You know, They've got hundreds of carriers. So we kind

630
00:34:25,840 --> 00:34:29,000
Speaker 3: of talked through different things and how to get excess.

631
00:34:29,080 --> 00:34:31,799
Speaker 3: I think they're going to primarily push their partners to

632
00:34:31,840 --> 00:34:35,719
Speaker 3: buy an extra one or two million dollars of GL coverage.

633
00:34:35,800 --> 00:34:38,319
Speaker 3: But the more important part of that story is the

634
00:34:38,400 --> 00:34:41,480
Speaker 3: shipper and it's not hit the press because they are private,

635
00:34:42,040 --> 00:34:44,480
Speaker 3: just lost almost twenty three million dollars.

636
00:34:44,719 --> 00:34:48,239
Speaker 2: Yeah, it's gonna be tough, fine, yea, even for the EXCESSGL,

637
00:34:48,239 --> 00:34:49,120
Speaker 2: it's gonna be tough.

638
00:34:49,440 --> 00:34:52,399
Speaker 1: So I'm just because gonna ask really probably the really

639
00:34:52,440 --> 00:34:55,480
Speaker 1: stupid basic question, So why is the shipper on the

640
00:34:55,520 --> 00:34:59,360
Speaker 1: hook for the money if somebody else was driving a truck?

641
00:34:59,520 --> 00:35:01,400
Speaker 3: Well, that's happened more than once.

642
00:35:02,000 --> 00:35:02,719
Speaker 2: Or do they is it?

643
00:35:02,880 --> 00:35:03,840
Speaker 1: Is it a private fleet?

644
00:35:04,360 --> 00:35:06,960
Speaker 3: No, it was there was a freight broker involved and

645
00:35:07,000 --> 00:35:11,520
Speaker 3: there wasn't enough coverage. So the ambulance chasing attorneys and

646
00:35:11,680 --> 00:35:15,360
Speaker 3: that's probably not fair to all Plaineffs attorneys, but you know,

647
00:35:15,400 --> 00:35:17,160
Speaker 3: they figured out where the money was going to be,

648
00:35:17,320 --> 00:35:21,480
Speaker 3: and I think they figured out that some of the

649
00:35:21,560 --> 00:35:25,040
Speaker 3: vetting wasn't maybe as thorough in hindsight as it should

650
00:35:25,040 --> 00:35:25,319
Speaker 3: have been.

651
00:35:25,360 --> 00:35:25,800
Speaker 2: Gotcha.

652
00:35:26,360 --> 00:35:30,120
Speaker 3: Plus they played the sympathy card. Again, that's so important.

653
00:35:30,440 --> 00:35:33,800
Speaker 3: It doesn't get enough attention on how good the Plainiffs

654
00:35:33,840 --> 00:35:37,919
Speaker 3: attorneys have been on portraying stories. Even you know, if

655
00:35:38,200 --> 00:35:41,319
Speaker 3: as Andrews said, most of the companies we deal with

656
00:35:41,360 --> 00:35:43,480
Speaker 3: when they know they're at fault, they do want to pay.

657
00:35:43,880 --> 00:35:47,160
Speaker 3: But then you've got such a gap between what the

658
00:35:47,280 --> 00:35:52,480
Speaker 3: injured wants, in particular his or her attorney versus maybe

659
00:35:52,520 --> 00:35:56,120
Speaker 3: what's a realistic settlement, and then time becomes the enemy

660
00:35:56,600 --> 00:35:58,920
Speaker 3: of a favorable settlement the longer it goes on.

661
00:35:59,480 --> 00:36:03,480
Speaker 1: Right, So I started talking about none or Andrewy, you

662
00:36:03,520 --> 00:36:09,120
Speaker 1: mentioned non domicile CDL holders. Obviously, the fate of you know,

663
00:36:09,160 --> 00:36:13,120
Speaker 1: renewing those uh, you know those CDLs are in the

664
00:36:13,200 --> 00:36:15,440
Speaker 1: courts right now. I think that in the courts of

665
00:36:16,400 --> 00:36:19,760
Speaker 1: DC Court of Appeals right now, whether or not limiting

666
00:36:19,760 --> 00:36:24,839
Speaker 1: that is legal. Do non domicile CDL holders, if they're

667
00:36:24,840 --> 00:36:27,640
Speaker 1: an owner operator, do they pay a higher premium on

668
00:36:27,760 --> 00:36:29,320
Speaker 1: average for any reason?

669
00:36:30,560 --> 00:36:35,200
Speaker 2: They don't? And I, you know, typically the way insurance

670
00:36:35,280 --> 00:36:37,879
Speaker 2: is still rated a lot of times is I will

671
00:36:37,920 --> 00:36:41,040
Speaker 2: say it limits kind of the amount of companies that

672
00:36:41,040 --> 00:36:45,120
Speaker 2: are willing to take on that risk. But I do

673
00:36:45,200 --> 00:36:47,480
Speaker 2: think a lot of times the insurance industry is still

674
00:36:47,480 --> 00:36:51,960
Speaker 2: based off you know, driver performance, historical losses, and honestly,

675
00:36:52,040 --> 00:36:54,440
Speaker 2: for some of the smaller fleets kind of your CSA

676
00:36:54,560 --> 00:36:59,360
Speaker 2: safety scores. I will say a growing kind of issue

677
00:36:59,400 --> 00:37:01,759
Speaker 2: within our end history and that we've seen on the

678
00:37:01,800 --> 00:37:05,239
Speaker 2: insurance side and the insurance companies have seen is not

679
00:37:05,280 --> 00:37:09,359
Speaker 2: only the what we call scheduled drivers. Right when you

680
00:37:09,520 --> 00:37:11,480
Speaker 2: buy a business auto and if you have children or

681
00:37:11,520 --> 00:37:14,080
Speaker 2: anything else, you need to list your drivers. Same thing

682
00:37:14,120 --> 00:37:16,920
Speaker 2: applies to commercial insurance, commercial trucking. They want to know

683
00:37:16,960 --> 00:37:20,080
Speaker 2: who's driving for you, the amount of equipment on the road.

684
00:37:21,120 --> 00:37:23,919
Speaker 2: I think we are seeing our industry there's a there's

685
00:37:23,960 --> 00:37:28,320
Speaker 2: an issue with non scheduled drivers and non scheduled units,

686
00:37:28,360 --> 00:37:32,760
Speaker 2: which means that you know, Tom is may have fifty trucks,

687
00:37:32,920 --> 00:37:37,600
Speaker 2: he buys insurance for thirty. The MCS ninety requires insurance

688
00:37:37,600 --> 00:37:39,719
Speaker 2: companies to protect the public, so they're on the hook

689
00:37:39,760 --> 00:37:41,920
Speaker 2: and they will pay for a loss. But Tom doesn't

690
00:37:41,920 --> 00:37:44,719
Speaker 2: report the other trucks or tell anyone he's bought them.

691
00:37:45,520 --> 00:37:48,280
Speaker 2: Grabs the name on the side. Yeah, and so you're

692
00:37:48,360 --> 00:37:51,799
Speaker 2: facing it's like we said, right, it's any industry, it's

693
00:37:52,200 --> 00:37:56,040
Speaker 2: you know, it's banking, investments, I mean, whatever you want

694
00:37:56,080 --> 00:37:58,960
Speaker 2: to do, any type of sales. There's in any service

695
00:37:58,960 --> 00:38:03,839
Speaker 2: industry good providers, bad providers, medical, you know, they work

696
00:38:03,920 --> 00:38:06,759
Speaker 2: comp face that for many years. They're even seeing it

697
00:38:06,880 --> 00:38:10,400
Speaker 2: on speaking of this, the liability pressures for trucking companies

698
00:38:10,400 --> 00:38:13,520
Speaker 2: as we talk about it, they've seen networks of medical

699
00:38:13,560 --> 00:38:16,400
Speaker 2: providers kind of all colluding together to try to create

700
00:38:16,880 --> 00:38:20,080
Speaker 2: you know, higher settlements. You know, there was that famous

701
00:38:20,120 --> 00:38:23,719
Speaker 2: Louisiana case of like this whole network. So you know,

702
00:38:23,840 --> 00:38:26,840
Speaker 2: I think the non CDLs it's going to face growing

703
00:38:26,920 --> 00:38:30,000
Speaker 2: pressure because even with let's just say the two latest

704
00:38:30,120 --> 00:38:32,640
Speaker 2: kind of to hit the headlines in Florida and California,

705
00:38:33,640 --> 00:38:36,000
Speaker 2: which which is a whole nother issue when you have

706
00:38:36,080 --> 00:38:41,000
Speaker 2: states issuing CDLs to people who do not meet requirements.

707
00:38:41,040 --> 00:38:43,040
Speaker 2: I mean, the fact that there's CDLs out there with

708
00:38:43,080 --> 00:38:45,920
Speaker 2: no name given written on them is to me something

709
00:38:45,960 --> 00:38:48,480
Speaker 2: that has to be addressed at a at a major

710
00:38:48,640 --> 00:38:51,640
Speaker 2: federal level and some type of penalties, because I mean,

711
00:38:51,680 --> 00:38:55,080
Speaker 2: anyone with a family or even yourself, the fact that

712
00:38:55,120 --> 00:38:56,520
Speaker 2: I could be on the road, I mean I was

713
00:38:56,560 --> 00:38:58,880
Speaker 2: driven back late last night and I saw someone I'm like,

714
00:38:59,520 --> 00:39:01,520
Speaker 2: do they know I to drive? It was eighteen wheeler.

715
00:39:01,960 --> 00:39:03,680
Speaker 2: Usually I'll take a video or try to find the

716
00:39:03,719 --> 00:39:07,560
Speaker 2: company not to but on blast just say hey, this

717
00:39:07,600 --> 00:39:10,439
Speaker 2: is why our industry gets bad name, like they're all

718
00:39:10,480 --> 00:39:12,480
Speaker 2: over the place. I don't know what was going on

719
00:39:12,600 --> 00:39:14,840
Speaker 2: or what was happening, but I'm sitting there and I have,

720
00:39:15,120 --> 00:39:17,120
Speaker 2: you know, my daughter in the car, and I'm going, wow,

721
00:39:17,200 --> 00:39:20,960
Speaker 2: she's gonna be driving soon. And this large vehicle can

722
00:39:21,040 --> 00:39:23,719
Speaker 2: even stay in three lanes hardly. They're all over. I

723
00:39:23,719 --> 00:39:27,640
Speaker 2: don't know what was going on, but straighten it out eventually,

724
00:39:27,680 --> 00:39:30,120
Speaker 2: But I do have a picture and we'll probably say something.

725
00:39:30,160 --> 00:39:33,120
Speaker 2: But I do think that's we're gonna have to combat

726
00:39:33,160 --> 00:39:36,480
Speaker 2: that now. The insurance industry. The problem with that is

727
00:39:36,560 --> 00:39:40,200
Speaker 2: it puts this pressure and it puts this publicity on

728
00:39:41,080 --> 00:39:44,360
Speaker 2: this could happen even though Lee seems to run a

729
00:39:44,360 --> 00:39:47,719
Speaker 2: great company, so does Tom. And then carriers that think

730
00:39:47,760 --> 00:39:51,600
Speaker 2: they could come in and actually write trucking companies for

731
00:39:51,640 --> 00:39:54,680
Speaker 2: a profit, because let's face it, their business insurance companies

732
00:39:54,719 --> 00:39:57,320
Speaker 2: are they need to make a profit. They won't ensure it.

733
00:39:57,320 --> 00:40:00,600
Speaker 2: It just puts kind of this this mark in earmark

734
00:40:00,680 --> 00:40:03,520
Speaker 2: on commercial transportation. It's like, we don't want to touch this.

735
00:40:03,719 --> 00:40:06,640
Speaker 2: It's a mess. In the United States, people can sue.

736
00:40:06,840 --> 00:40:10,720
Speaker 2: You don't have any federal regulation on people being issued

737
00:40:10,760 --> 00:40:17,320
Speaker 2: CDLs that are unfortunately causing terrible catastrophic accidents, loss of life,

738
00:40:17,440 --> 00:40:21,279
Speaker 2: permanent disability. Why would we want to ensure this marketplace?

739
00:40:22,200 --> 00:40:25,520
Speaker 2: And that's really what's the biggest issue that we're seeing

740
00:40:25,600 --> 00:40:27,680
Speaker 2: is carriers are just pulling out. They don't even want

741
00:40:27,719 --> 00:40:31,839
Speaker 2: to take a chance on really good risk because of

742
00:40:32,040 --> 00:40:35,400
Speaker 2: everyone everything else that's happening that's almost outside their control.

743
00:40:35,719 --> 00:40:40,840
Speaker 1: Who are the major writers of trucking insurance right now?

744
00:40:41,360 --> 00:40:45,879
Speaker 2: Great West is one of the premier providers. All they do,

745
00:40:46,560 --> 00:40:50,520
Speaker 2: they've been around forever, great West, Old Republic. You have Progressive,

746
00:40:51,640 --> 00:40:56,759
Speaker 2: you have Berkshire, AIG Berkeley Companies, which includes a number

747
00:40:56,760 --> 00:40:58,480
Speaker 2: of different companies that have done it for a very

748
00:40:58,480 --> 00:41:02,400
Speaker 2: long time. Can Now Insurance. So those are kind of

749
00:41:02,440 --> 00:41:06,919
Speaker 2: the national interstate century trying to that's a tough question

750
00:41:06,960 --> 00:41:08,520
Speaker 2: to ask. I don't want to leave anyone else, so

751
00:41:08,560 --> 00:41:10,640
Speaker 2: they don't get mad at me if they listen to this.

752
00:41:10,800 --> 00:41:14,359
Speaker 2: But there's some really good companies. But there's also a

753
00:41:14,360 --> 00:41:17,959
Speaker 2: lot of just programs, so you know, things that you say,

754
00:41:17,960 --> 00:41:21,360
Speaker 2: and so there are carriers that specialize, let's say, in

755
00:41:21,800 --> 00:41:26,080
Speaker 2: cross border companies. Obviously, we we've done very few acquisitions

756
00:41:26,080 --> 00:41:29,040
Speaker 2: in the history of reliance. But across cross border was

757
00:41:29,080 --> 00:41:32,880
Speaker 2: one with Mark Vickers, who really understands the industry and

758
00:41:32,920 --> 00:41:35,759
Speaker 2: B one drivers, and that's like a whole marketplace in

759
00:41:35,800 --> 00:41:39,800
Speaker 2: itself that we've educated. You know, a lot of insurance

760
00:41:39,840 --> 00:41:43,280
Speaker 2: companies on to learn that marketplace so they can ensure

761
00:41:43,360 --> 00:41:46,960
Speaker 2: them and write them properly. But it's you know, those

762
00:41:47,000 --> 00:41:49,560
Speaker 2: are kind of the most of the premier providers. Tom,

763
00:41:49,560 --> 00:41:52,359
Speaker 2: if I left one off, please say so. I don't

764
00:41:52,360 --> 00:41:54,200
Speaker 2: make anyone upset, Lee. We have.

765
00:41:54,880 --> 00:41:57,719
Speaker 3: The way it works as an agency is you get

766
00:41:57,760 --> 00:42:03,040
Speaker 3: appointments with underwriters, and so when Andrew and even after

767
00:42:03,120 --> 00:42:06,160
Speaker 3: Chad joined, five or six years after Andrew founded the company,

768
00:42:06,160 --> 00:42:09,120
Speaker 3: they were still going around, beaten on doors trying to

769
00:42:09,120 --> 00:42:13,000
Speaker 3: get underwriters to a point reliance. And then they reached

770
00:42:13,000 --> 00:42:16,360
Speaker 3: a point where underwriters now reach out to us. But

771
00:42:16,480 --> 00:42:20,479
Speaker 3: we have about two hundred underwriter appointments, some of which

772
00:42:20,600 --> 00:42:24,359
Speaker 3: we may only do one to five policies a year.

773
00:42:24,600 --> 00:42:29,040
Speaker 3: They're specialized, or they deal with very high risk motor carriers.

774
00:42:29,080 --> 00:42:32,919
Speaker 3: There could be any number of things, but I think

775
00:42:32,960 --> 00:42:37,000
Speaker 3: Andrew got the essence of a lot of the leaders.

776
00:42:37,040 --> 00:42:39,560
Speaker 3: But I wanted to kind of go into this issue

777
00:42:39,600 --> 00:42:41,600
Speaker 3: just a little bit more. You know, Andrew gave an

778
00:42:41,600 --> 00:42:45,319
Speaker 3: example of a carrier that may have thirty trucks on

779
00:42:45,360 --> 00:42:49,200
Speaker 3: their insurance policy, but they're really operating fifty or more.

780
00:42:49,840 --> 00:42:52,360
Speaker 3: We had one of our agents told me this summer

781
00:42:53,600 --> 00:42:56,400
Speaker 3: one of their insureds got hit by another trucking company

782
00:42:56,440 --> 00:42:58,200
Speaker 3: and it looked to be they were hit by a

783
00:42:58,200 --> 00:43:03,120
Speaker 3: one truck operator. It turns out that there's one thousand

784
00:43:03,120 --> 00:43:07,360
Speaker 3: trucks operating there and they were paying insurance on one truck.

785
00:43:07,920 --> 00:43:11,520
Speaker 3: And so my underwrider missed that there had been three

786
00:43:11,640 --> 00:43:15,680
Speaker 3: hundred and seventy inspections in the previous one hundred days.

787
00:43:16,600 --> 00:43:20,680
Speaker 3: And that's not an exception. That's how big this fraud

788
00:43:20,800 --> 00:43:25,320
Speaker 3: has become. And there was another situation where it looked

789
00:43:25,360 --> 00:43:30,160
Speaker 3: like a one truck company hit someone and it turns

790
00:43:30,160 --> 00:43:33,000
Speaker 3: out they had four hundred and fifty trucks, And I think,

791
00:43:33,040 --> 00:43:37,080
Speaker 3: what's the non domiciled ELP. This is just the tip

792
00:43:37,080 --> 00:43:42,320
Speaker 3: of the iceberg in exposing things. There's a large fleet

793
00:43:42,400 --> 00:43:44,200
Speaker 3: in the Midwest that I'm not going to name the

794
00:43:44,280 --> 00:43:48,600
Speaker 3: name of. They advertise having between seven hundred and fifty

795
00:43:48,600 --> 00:43:52,759
Speaker 3: to eight hundred trucks, yet they've boasted to their Romanian

796
00:43:52,800 --> 00:43:57,000
Speaker 3: investors that they have ten thousand trucks, and I have

797
00:43:57,160 --> 00:44:00,360
Speaker 3: looked up whenever I see their trucks, it's always listed

798
00:44:00,440 --> 00:44:04,520
Speaker 3: is one. Now they have several dot numbers, but the

799
00:44:04,600 --> 00:44:11,560
Speaker 3: amount of non compliant fraudulent carriers is maybe fifteen percent

800
00:44:11,560 --> 00:44:15,400
Speaker 3: of the industry. That's the biggest reason why this freight

801
00:44:15,440 --> 00:44:17,919
Speaker 3: recession recently began its fourth year.

802
00:44:19,480 --> 00:44:23,479
Speaker 1: And so you know we're coming up on the time.

803
00:44:23,520 --> 00:44:25,799
Speaker 1: But I want to hear from you guys. So what

804
00:44:26,040 --> 00:44:30,920
Speaker 1: should the industry do and what should the government do

805
00:44:32,000 --> 00:44:35,880
Speaker 1: to Obviously you're not going to cure the disease, but

806
00:44:36,000 --> 00:44:38,600
Speaker 1: you can make it a lot less worse.

807
00:44:38,760 --> 00:44:41,120
Speaker 2: I guess for I need another hour, I mean I could.

808
00:44:41,160 --> 00:44:43,359
Speaker 2: I'll highlight real quick and then I'll let you kind

809
00:44:43,400 --> 00:44:45,880
Speaker 2: of go. Tom. But you know, because Tom and I

810
00:44:45,960 --> 00:44:48,399
Speaker 2: discussed this and Leah, I think you had some good

811
00:44:48,400 --> 00:44:52,520
Speaker 2: points to bring up. And I think a lot of

812
00:44:52,600 --> 00:44:57,520
Speaker 2: things the current administration has brought forth is very important.

813
00:44:58,080 --> 00:45:00,600
Speaker 2: Can do a lot of good for our industry. You know,

814
00:45:00,719 --> 00:45:03,320
Speaker 2: to me, there's different sides. You have kind of the

815
00:45:03,480 --> 00:45:08,120
Speaker 2: fmcsa dot and then you have kind of the world

816
00:45:08,160 --> 00:45:11,560
Speaker 2: that you brought us on. For myself, for insurance risk management.

817
00:45:11,600 --> 00:45:13,160
Speaker 2: I think there's things we can do on the insurance

818
00:45:13,200 --> 00:45:15,880
Speaker 2: side as well, But I think everything looks good on

819
00:45:15,960 --> 00:45:19,600
Speaker 2: paper if we put in but there has to be action, right,

820
00:45:19,680 --> 00:45:21,600
Speaker 2: So I think if we have the right numbers of people,

821
00:45:21,840 --> 00:45:24,120
Speaker 2: they're able to do the inspections. When I first got

822
00:45:24,160 --> 00:45:26,399
Speaker 2: in this industry in the early two thousands, I felt

823
00:45:26,480 --> 00:45:30,120
Speaker 2: like every trucking company I wrote, I felt like every

824
00:45:30,160 --> 00:45:33,360
Speaker 2: month one of my clients was getting a DOT audit

825
00:45:33,880 --> 00:45:36,000
Speaker 2: to know if they were satisfactory or not. I mean

826
00:45:36,040 --> 00:45:41,520
Speaker 2: it just was like routine. Now, I rarely hear any

827
00:45:41,560 --> 00:45:43,719
Speaker 2: of my people getting dot audits. And there's a lot

828
00:45:43,760 --> 00:45:46,120
Speaker 2: more motor carriers now than what there was then, but

829
00:45:46,120 --> 00:45:48,799
Speaker 2: there was still a lot back then. So I think,

830
00:45:49,239 --> 00:45:51,480
Speaker 2: you know, a lot of these things with the ALPS

831
00:45:51,960 --> 00:45:55,479
Speaker 2: and some of the other things are trying to pass

832
00:45:55,520 --> 00:45:57,600
Speaker 2: the legislation. I think we just have to make sure

833
00:45:57,600 --> 00:46:01,000
Speaker 2: reinforce that. And then I think from the end insurance side,

834
00:46:01,160 --> 00:46:03,280
Speaker 2: what we're going to see for anyone that's worried about

835
00:46:03,320 --> 00:46:06,520
Speaker 2: next year twenty twenty six, I mean most carriers are

836
00:46:06,600 --> 00:46:10,560
Speaker 2: filing rate increases, So I think be smart about who

837
00:46:10,600 --> 00:46:14,400
Speaker 2: you approach, make sure you choose a partner that is

838
00:46:15,040 --> 00:46:19,359
Speaker 2: that understands the transportation industry, that has great market representation,

839
00:46:19,520 --> 00:46:21,600
Speaker 2: so they can look at a number of different factors

840
00:46:22,120 --> 00:46:24,040
Speaker 2: and make sure you become as educated as you can

841
00:46:24,120 --> 00:46:27,840
Speaker 2: about how to relimit this cost to our company to

842
00:46:27,880 --> 00:46:30,360
Speaker 2: help our bottom line. So is that take on a deductible?

843
00:46:30,440 --> 00:46:32,160
Speaker 2: Is it smart for us? Look at the number of

844
00:46:32,160 --> 00:46:35,640
Speaker 2: claims you've had the last five years. Sometimes a deductible

845
00:46:35,719 --> 00:46:38,120
Speaker 2: may make sense and it's a way to offset the

846
00:46:38,200 --> 00:46:41,720
Speaker 2: premium increases. But you know, I think from our side,

847
00:46:41,760 --> 00:46:44,319
Speaker 2: it's continuing to just and I think there's a lot

848
00:46:44,360 --> 00:46:48,319
Speaker 2: going on because of eleds, telematics and cameras that are

849
00:46:48,400 --> 00:46:52,480
Speaker 2: allowing us slowly to deny claims that in the past

850
00:46:52,520 --> 00:46:54,839
Speaker 2: we're probably paid. But that takes time. It takes three

851
00:46:54,920 --> 00:46:59,440
Speaker 2: to five years, honestly to make that up. So hopefully

852
00:46:59,520 --> 00:47:02,240
Speaker 2: in the next couple of years, we'll see insurance premiums

853
00:47:02,320 --> 00:47:04,200
Speaker 2: kind of flatten out a little bit instead of these

854
00:47:04,280 --> 00:47:07,480
Speaker 2: drastic increases every year. But I think, you know, for

855
00:47:07,560 --> 00:47:10,040
Speaker 2: the buyers and anyone that's having to purchase insurance in

856
00:47:10,080 --> 00:47:13,200
Speaker 2: the commercial trucking industry or even the freight brokerage industry,

857
00:47:13,560 --> 00:47:15,920
Speaker 2: we see those premiums go up. Just make sure you're

858
00:47:15,960 --> 00:47:19,160
Speaker 2: doing the right things and always think of your safety scores,

859
00:47:19,680 --> 00:47:23,080
Speaker 2: your carrier vetting systems. Everything's a resume to almost build

860
00:47:23,120 --> 00:47:25,880
Speaker 2: your resume to where you know someone will want to

861
00:47:25,880 --> 00:47:28,279
Speaker 2: take a chance to ensure you. And I think it's

862
00:47:28,360 --> 00:47:30,399
Speaker 2: just like applying for a job. I think it's very

863
00:47:30,440 --> 00:47:34,040
Speaker 2: important for the buyers to understand that because that's what

864
00:47:34,120 --> 00:47:37,799
Speaker 2: the underwriters within the kind of the supply chain, logistics

865
00:47:37,800 --> 00:47:41,040
Speaker 2: and trucking industry is looking at daily to make sure like,

866
00:47:41,360 --> 00:47:44,600
Speaker 2: are we going to make money on this risk, is

867
00:47:44,600 --> 00:47:46,800
Speaker 2: this a risk we want to take on, or even

868
00:47:46,840 --> 00:47:49,920
Speaker 2: if are we going to get aggressive on pricing? Because

869
00:47:49,960 --> 00:47:52,240
Speaker 2: they've learned from things that have happened in the past,

870
00:47:52,600 --> 00:47:56,080
Speaker 2: that is very very important. So I appreciate you having

871
00:47:56,120 --> 00:47:58,200
Speaker 2: us on today, and I'll let Tom kind of close

872
00:47:58,239 --> 00:47:58,560
Speaker 2: it out.

873
00:47:58,800 --> 00:48:02,600
Speaker 3: Well, let me rattle off just a handful of practical

874
00:48:02,640 --> 00:48:07,440
Speaker 3: examples or suggestions. First of all, I want to emphasize

875
00:48:07,480 --> 00:48:10,759
Speaker 3: how fragmented the industry has become. The ATA puts out

876
00:48:10,840 --> 00:48:14,760
Speaker 3: their Trucking Trends Report every I think it's late summer,

877
00:48:14,800 --> 00:48:18,360
Speaker 3: early fall. Ten years ago, they said that the number

878
00:48:18,400 --> 00:48:22,040
Speaker 3: of carriers that had twenty or fewer truck trucks was

879
00:48:22,040 --> 00:48:25,560
Speaker 3: about ninety one percent of the industry. Their most recent

880
00:48:25,560 --> 00:48:29,520
Speaker 3: addition says ninety six percent have ten or fewer. So

881
00:48:29,640 --> 00:48:32,600
Speaker 3: ninety one went to ninety six and twenty went to ten.

882
00:48:33,480 --> 00:48:37,120
Speaker 3: But there's so many things, like, for example, they've got

883
00:48:37,120 --> 00:48:42,239
Speaker 3: to focus on standardizing what's called the CDL mills. You know,

884
00:48:42,280 --> 00:48:45,160
Speaker 3: there's got to be a standard around truck driver training

885
00:48:45,200 --> 00:48:46,680
Speaker 3: schools to get your CDL.

886
00:48:47,320 --> 00:48:48,080
Speaker 2: Maybe we need to.

887
00:48:48,080 --> 00:48:50,920
Speaker 3: Have the same process as the twig cards, which is

888
00:48:50,960 --> 00:48:54,959
Speaker 3: what's required in and around ports and airports. You don't

889
00:48:54,960 --> 00:48:59,960
Speaker 3: hear of any of these fraudulent issues there. The FMCSA

890
00:49:00,080 --> 00:49:04,440
Speaker 3: needs to upgrade its own software. So for example, that

891
00:49:04,560 --> 00:49:08,040
Speaker 3: when a motor carrier lists their principal place of business

892
00:49:08,120 --> 00:49:12,319
Speaker 3: as a PO box, which is against the law, you

893
00:49:12,360 --> 00:49:16,040
Speaker 3: can investigate that. They need to take a look at

894
00:49:16,040 --> 00:49:19,640
Speaker 3: the top twenty five to fifty cities every month that

895
00:49:19,719 --> 00:49:23,920
Speaker 3: are getting DOT numbers. That way, places like Sheridan, Wyoming,

896
00:49:24,239 --> 00:49:29,400
Speaker 3: Union City, California, Signal Hill, California, where there's thousands of

897
00:49:29,440 --> 00:49:33,280
Speaker 3: motor carriers sometimes bigger than the population of the cities

898
00:49:33,719 --> 00:49:37,040
Speaker 3: right there, that should be just an indication on what

899
00:49:37,080 --> 00:49:40,200
Speaker 3: they need to do in the buying and selling of

900
00:49:41,120 --> 00:49:44,600
Speaker 3: MC numbers or motor carrier numbers. There needs to be

901
00:49:44,640 --> 00:49:48,319
Speaker 3: a verification of the seller and the buyer right now,

902
00:49:48,320 --> 00:49:53,440
Speaker 3: that's essentially done in a private marketplace. I'll just give

903
00:49:53,480 --> 00:49:57,160
Speaker 3: you an oddball example that the most common phone number

904
00:49:57,520 --> 00:50:01,879
Speaker 3: for motor carriers in the FMCSA data is one one

905
00:50:02,000 --> 00:50:06,640
Speaker 3: one one one one one one one one. Thousands of

906
00:50:06,760 --> 00:50:09,080
Speaker 3: carriers are using that. That's why they don't have good

907
00:50:09,160 --> 00:50:11,960
Speaker 3: enough software that ought to be an automatic alert. And

908
00:50:12,080 --> 00:50:15,480
Speaker 3: I'm just old enough to remember the song eight six

909
00:50:15,640 --> 00:50:20,120
Speaker 3: seven five three oh nine. There's over fifty carriers use

910
00:50:20,200 --> 00:50:27,240
Speaker 3: that phone number. Jenny is in trucking. Yeah. It really

911
00:50:27,320 --> 00:50:32,240
Speaker 3: is a place, though, where practical ideas should be able

912
00:50:32,280 --> 00:50:35,319
Speaker 3: to flourish because there's so many people that care and

913
00:50:35,400 --> 00:50:38,880
Speaker 3: that are beginning to think through these issues. Somehow the

914
00:50:39,200 --> 00:50:44,280
Speaker 3: s in FMCSA. Safety has not been front and center

915
00:50:44,719 --> 00:50:48,280
Speaker 3: over the last eight to ten years, probably for political

916
00:50:48,360 --> 00:50:52,279
Speaker 3: reasons or other reasons, who knows, But we need to

917
00:50:52,280 --> 00:50:55,200
Speaker 3: get back to safety, the public safety. That should not

918
00:50:55,280 --> 00:51:00,640
Speaker 3: be a Republican versus democratic issue, blue versus red. It's

919
00:51:01,000 --> 00:51:05,600
Speaker 3: public safety and we've gotten away from that, and there's

920
00:51:05,680 --> 00:51:09,000
Speaker 3: too many good operators that care and they're being hurt

921
00:51:09,120 --> 00:51:14,960
Speaker 3: by these non compliant, fraudulent operators when and I differentiate

922
00:51:15,040 --> 00:51:20,280
Speaker 3: that fraudulent generally means they're committed to stealing cargo. Non

923
00:51:20,320 --> 00:51:24,280
Speaker 3: compliant means maybe they're they've got one of these phony

924
00:51:24,320 --> 00:51:27,360
Speaker 3: elds that can be doctored and they're driving three to

925
00:51:27,440 --> 00:51:31,960
Speaker 3: four thousand miles a week instead of two thousand, or

926
00:51:32,000 --> 00:51:38,359
Speaker 3: they're they're just they're going without inspections. There's fifty three

927
00:51:38,400 --> 00:51:41,560
Speaker 3: thousand motor carriers that have not had an inspection in

928
00:51:41,600 --> 00:51:44,640
Speaker 3: the last three years, and over one hundred thousand that

929
00:51:44,760 --> 00:51:49,080
Speaker 3: haven't had one in the last year. I mean, that's crazy.

930
00:51:50,080 --> 00:51:52,520
Speaker 3: So the list could go on and on. We can

931
00:51:52,560 --> 00:51:54,799
Speaker 3: have a lot of fun with that, but it is

932
00:51:54,960 --> 00:51:58,839
Speaker 3: serious business and it's hurting the healthy operators, and it's

933
00:51:58,880 --> 00:52:03,600
Speaker 3: putting undue pressure sure on the industry and the underwriters.

934
00:52:03,640 --> 00:52:06,640
Speaker 3: These underwriters are in this because you know, they believe

935
00:52:06,680 --> 00:52:09,200
Speaker 3: in trucking as well, but you know they've got to

936
00:52:09,200 --> 00:52:12,480
Speaker 3: get a return on the risk dollars that they put

937
00:52:12,520 --> 00:52:13,959
Speaker 3: to work every single day.

938
00:52:15,280 --> 00:52:18,759
Speaker 1: Sure, absolutely, Well, you know, before this conversation began, I

939
00:52:18,760 --> 00:52:21,359
Speaker 1: didn't think we'd be talking so much and so long

940
00:52:21,440 --> 00:52:24,160
Speaker 1: about insurance. I really enjoyed the conversation. Actually only got

941
00:52:24,160 --> 00:52:25,799
Speaker 1: two a handful of my questions. So I'd like to

942
00:52:25,800 --> 00:52:28,759
Speaker 1: have you guys back on the podcast maybe next year.

943
00:52:29,800 --> 00:52:31,960
Speaker 1: So Tom and Andrew just really want to thank you

944
00:52:32,000 --> 00:52:33,479
Speaker 1: for your time and your insights today.

945
00:52:33,480 --> 00:52:36,399
Speaker 2: I really appreciate it. Thank you so much, Ley, and.

946
00:52:36,360 --> 00:52:38,040
Speaker 1: I want to thank you for tuning in. If you

947
00:52:38,120 --> 00:52:41,160
Speaker 1: liked the episode, please subscribe and leave a review. We've

948
00:52:41,200 --> 00:52:43,320
Speaker 1: lined up a number of great guests for the podcast,

949
00:52:43,360 --> 00:52:48,799
Speaker 1: so please check back to hear conversations with C suite executives, shippers, regulators,

950
00:52:48,840 --> 00:52:51,800
Speaker 1: and decision makers within the freight markets. Also, if you

951
00:52:51,840 --> 00:52:54,560
Speaker 1: want to learn more about the freight transportation markets, check

952
00:52:54,560 --> 00:52:57,279
Speaker 1: out our work on the Bloomberg Terminal at BIGO and

953
00:52:57,320 --> 00:53:00,520
Speaker 1: on social media. This is Lee Clascow signing up. Thanks

954
00:53:00,520 --> 00:53:06,239
Speaker 1: for talking transports with me. Talk to you soon. Bye,