The trucking industry was facing skyrocketing insurance costs even before the Sept. 11 terrorist attacks. With the insurance industry facing billions of dollars in claims resulting from the collapse of the World Trade Center, there are concerns that costs will go even higher.
ATA interim President William Canary this week sent letters to insurance commissioners in all 50 states. He pointed out that even as the trucking industry "pledges its tireless efforts to keep the nation's economy on track," it is facing a potential insurance crisis.
Canary acknowledges that market forces may dictate some increases in premium costs, but says, "We are concerned that a few unscrupulous companies may attempt to take advantage of the recent turmoil and impose unconscionable premium increases on our industry," he writes.
"Outrageous insurance premiums could well make the difference as to whether many trucking companies survive in these difficult economic times. And, if trucking services are diminished, our nation's economy ultimately suffers."
Canary asked the insurance commissioners to vigorously enforce state insurance regulatory provisions that prohibit excessive premium rates and unfair trade practices.
Insurance costs have been driven higher largely by a surge in high jury awards and out-of-court settlements following accidents - accidents in many cases where the truck is not at fault. In addition, insurance companies have traditionally made money by investing customers' premiums in the stock market - a strategy that has resulted in losses in recent months.
During a recent speech, Canary pointed out that the insurance problem needs to be addressed at the state level. "There are three things the federal government doesn't get involved in," he said. "Marriage, divorce, and insurance."