Dive Brief:
During an earnings call last week, J.B. Hunt Transport Services’ executive vice president and CFO, John Kuhlow, indicated that workforce costs and insurance premiums are likely to continue increasing due to inflation. The company’s workforce expenses rose almost 5.7% year-over-year, reaching $812 million. Meanwhile, the carrier’s annual expenditures on insurance and claims exceeded $300 million in the past three years, up from $165 million in 2021, according to company reports. Kuhlow stated, “Even with two years of record safety performance, our insurance rates have more than doubled due to escalating claims resolution costs. This is a challenge faced by the entire industry, and these inflationary pressures will ultimately impact shippers and consumers.”
Dive Insight:
Trucking companies and associations are seeking reforms and relief on a national level, appealing to state legislatures to address what they describe as frivolous lawsuits. John Esparza, President and CEO of the Texas Trucking Association, shared with Trucking Dive in early January that legal settlements and verdicts are increasing in both frequency and payout amounts.
States like Florida, Iowa, and Texas have recently enacted laws aimed at lowering medical and legal expenses connected to accidents, but advocacy groups claim more action is necessary. Esparza emphasized, “Relief from insurance rates remains elusive, and we continue to hear about trucking companies shutting down.”
Over the past two years, J.B. Hunt was involved in crashes resulting in 55 fatalities and 515 injuries, according to data from the Federal Motor Carrier Safety Administration. The statistics do not indicate fault in these incidents.
In recent years, the company has distributed millions in bonuses to numerous drivers who have achieved safety milestones, reaching over a million miles without accidents.
Nick Hobbs, COO and president of highway and final mile services, stated on the earnings call, “Safety is fundamental to our operations. I’m proud to report that 2024 marks another record in our performance, measured by DOT preventable accidents per million miles. This marks our second consecutive year of record results, demonstrating our commitment to ongoing improvements in safety.”
