Shippers and freight brokers are facing a “landslide” of lawsuits related to truck accidents, says Tucker Company Worldwide President Jeffrey Tucker.
Those lawsuits are costing shippers and third-party logistics companies millions of dollars in settlements and putting pressure on insurance costs, Tucker said.
“The insurance industry is slowly pulling out of trucking activities,” he said, as settlements in accident cases mount to the $20 million to $25 million range.
“Insurers are asking us what we’re doing with truck safety,” said Tucker.
Court decisions against shippers and brokers that hired trucking companies involved in accidents have snowballed since the 2004 Schramm vs. Foster decision, he said.
In that case, a Maryland court found 3PL C.H. Robinson Worldwide negligent for hiring a trucking company that caused an accident, Groff Brothers Trucking.
Freight brokers and shippers must do more than due diligence when hiring carriers, carefully evaluating trucking company safety records, Tucker said.
“We turn away 69 percent of the carriers we look at” for safety reasons, he said, and Tucker’s freight management firm works with thousands of motor carriers.
Shippers need to vet brokers and brokers need to vet carriers to ensure loads aren’t double-brokered by one trucking company to another carrier, he said.
“We write that into our contracts, but we have to continually check, and ask our customers to keep an eye out for double-brokering as well,” said Tucker.
The Department of Transportation needs to do more to ensure its motor carrier safety ratings are up-to-date and accurate, Tucker said in an interview.
“We’re incredibly reliant of federal data, and we’re going to need to see more (safety compliance) reviews,” he said at the June 10 freight transportation policy forum organized by the National Industrial Transportation League in Arlington, Va.
He asked Transportation Secretary Ray LaHood and Federal Motor Carrier Safety Administrator Anne S. Ferro whether private consultants could be trained to conduct motor carrier safety compliance reviews on the DOT’s behalf.
“It’s an interesting concept,” said Ferro. “I look forward to discussing it.”
She said the FMCSA’s Comprehensive Safety Analysis 2010 initiative would improve the motor carrier safety data “tenfold” when it is fully implemented in 2011.
--Contact William B. Cassidy at email@example.com.