Increase in Liability Insurance Costs for Motor Carriers
According to recent findings from the American Transportation Research Institute (ATRI), the cost of liability insurance premiums for motor carriers is rising significantly faster than consumer inflation, despite a decrease in heavy-duty truck-related crash rates.
Rising Premiums Outpacing Inflation
ATRI’s latest report indicates that from 2021 to 2024, the costs of liability insurance premiums increased by 18.6%, reaching 10.2 cents per mile, which exceeds consumer inflation by 5.4 percentage points. During the same timeframe, truck-involved crash rates declined by 2.6%.
Impact of Rising Claims Expenses
The increase in insurance costs has been driven by a marked rise in crash claims expenses, with the ATRI survey revealing that liability losses per mile surged by an average of 33.1%.
Financial Pressures on Trucking Companies
ATRI noted that escalating insurance costs, especially in commercial auto liability, place significant financial strain on trucking companies, many of which are already navigating a challenging freight recession.
Excess Coverage Premiums on the Rise
Premiums for excess liability coverage have also risen at an even more pronounced rate, underscoring the impact of excessive litigation on inflated claims costs.
Commitment to Safety and Risk Management
Despite these obstacles, motor carriers are actively pursuing enhancements in safety and risk management. This includes improved driver training, the adoption of advanced safety technologies, and more customized coverage options along with responsibly managed risk.
Benchmarking and Risk Management Insights
ATRI’s complete report provides benchmarks that help fleets assess trends and evaluate their risk management strategies, including coverage limits, insurance expenditures as a percentage of revenue, and deductible or self-insurance levels based on fleet size.
