Truckers Win Fight to Keep Insurance Payouts Low

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Truckers Win Fight to Keep Insurance Payouts Low






This article was written by Paul Feldman, is a staff writer at FairWarning, a nonprofit news organization based in Pasadena, California, that focuses on public health, consumer and environmental issues.

Feds Reject Insurance Hike for Big-Rigs, Pleasing Independent Truckers, Rankling Safety Advocates

By Paul Feldman on July 13, 2017 Brown was headed to his job as a computer technician when a drowsy big-rig driver swerved into his path and struck his car, sending it flying off a rural Illinois road and into a field.

Brown was airlifted to a hospital for a six-hour surgery that saved his life. He suffered collapsed lungs, broken arms and legs, neurological damage and kidney failure, his mother, Kate Brown recalls. Hospitalized for 75 days after the May, 2005, accident, Graham Brown, now 40, has endured more than 20 surgeries and still cannot use his left hand or arm.

Yet because the small trucking company had little more than the federal minimum of $750,000 in liability insurance, Kate Brown says she and Graham’s father were forced to dip into their retirement funds and take big chunks of time off from work to help care for their son.

Graham Brown eventually received a settlement of about $300,000, she says, after payment of attorney’s fees and other expenses. With continuing medical costs and permanent injuries that could reduce his earnings, he faces an uncertain financial future.

Graham Brown, shown here with his mother, Kate Brown, was severely injured in a crash with a big-rig, and has had more than 20 surgeries. Because the trucking company had little more than the federal minimum of $750,000 in liability insurance, Brown faces an uncertain financial future.

The $750,000 minimum has been in place since 1983, but safety advocates who have campaigned to raise it have been stymied up to now. In their latest setback, the Trump administration in June dropped consideration of a higher minimum on grounds that it couldn’t get enough data from insurance and trucking firms to prove that the benefits would outweigh the costs. Efforts to raise the minimum previously stalled under the Obama administration, which also cited problems in collecting enough data.

Tens of thousands hurt

Kate Brown, of Gurnee, Illinois, said she was grateful her son survived, noting that “most people don’t live through crashes like that.” As for the financial stress on the family, Brown said it’s ”the price you have to pay because of the minimum insurance.”

Each year, close to 4,000 people are killed in the U.S. in crashes involving large trucks and tens of thousands more are hurt, some suffering catastrophic injuries that leave them disabled and in need of expensive lifetime care.

Yet for more than three decades, the federal minimum for truck liability insurance has remained stuck at $750,000. That amount, which must cover all victims of a crash, may be a fraction of the expenses for a single badly injured survivor. Simply adjusted for inflation, the minimum would be more than $2.2 million today.

“A million dollars wouldn’t have gotten my kids out of Akron Children’s Hospital,” said Baltimore resident Ed Slattery 61, a former economic analyst for the U.S. Department of Agriculture, who quit his job to care full-time for his two sons after they were critically injured in a 2010 big-rig crash on the Ohio Turnpike that killed his wife Susan.

The $750,000 minimum is a sliver of the $9.6 million value placed on a human life by the Department of Transportation when it is considering the costs and benefits of safety regulations.

Except for independent truckers, who say that even a small hike in their insurance premiums could force some of them off the road, few argue that the current minimum makes sense.

Action by private sector

The Trucking Alliance, an industry group that includes such major firms as J.B. Hunt and Knight, urges truckers to maintain coverage “significantly higher than the federal minimum requirement.” Doing so is necessary “to maintain the public’s trust and cover the medical costs associated with truck crash victims,” the organization says.

Even without a change in the government mandate, the private sector has moved the bar slightly on its own. A survey by the American Trucking Associations showed that eight of 10 truckers maintain $1-million of liability insurance to meet requirements imposed by private brokers and shipping companies.

Consumer advocate Joan Claybrook faulted both the Trump and Obama administrations for failing to raise minimum liability coverage for trucking firms.

In 2013, a bill to raise the minimum to more than $4 million was introduced by Rep. Matt Cartwright, D-Pa., but got no traction.

A year later, the Federal Motor Carrier Safety Administration, or FMCSA, the branch of the Department of Transportation that regulates interstate trucking, announced it would consider raising the minimum and requested public comment.

But in one of a flurry of deregulatory moves by the Trump administration, the motor carrier safety agency last month said it was withdrawing the proposal. Citing difficulty in getting industry data for a cost-benefit study, the agency said it lacked enough “information to support moving forward … at this time.”

Lack of data to justify an increase

Consumer advocate Joan Claybrook, the former head of the National Highway Traffic Safety Administration, called such reasoning ”ridiculous” and also condemned the Obama Administration’s failure to take action when it had the chance. She said that during Obama’s second term, officials of the motor carrier safety agency dragged their feet, also citing lack of enough data to justify an increase.

In an interview with FairWarning, Randi Hutchinson, chief counsel for the agency, said it cannot issue a regulation without ample cost-benefit evidence. If it did so, a court “would most likely find the regulation was arbitrary and capricious.”

Safety advocates said they hope the issue isn’t dead, and that they may again seek help from Congress.

“This remains a top priority for the congressman,” said Cartwright’s legislative director Jeremy Marcus. “Whether a legislative solution or working with the FMCSA, he’s still hoping to get these insurance rates raised to an appropriate level.”

Jackie Novak, of Hendersonville, North Carolina, who lost her only son, Charles, 22, in a crash with a tractor trailer in 2010, says she has little hope of action by the Trump administration.

The crash that took her son’s life also killed four others and injured more than a dozen. A $1 million liability policy was ultimately divided between survivors and next of kin. The family of Charles Novak, who had a two-year old son, got just over $100,000, Jackie Novak said.

‘Has your car insurance gone up?’

“Not only is he never going to know his father, but … someone has to pay to raise him.,” she said. “So guess what? Social Security is now taking up the task to raise my grandson.”

“I ask this question of every lawmaker that I’ve spoken to in Washington,” Novak told FairWarning. ” ‘Has your car insurance gone up in the last 34 years?’ Did anyone call to ask:  ‘Are we going to put you out of business if we raise the insurance?’ No, they just do it.

Charles Novak, a 22-year-old father, was killed along with four others in a crash with a tractor-trailer in 2010.

“So this argument that raising the minimum insurance would be putting small operators out of business doesn’t wash with me. … They permanently put my son out of business, so if you can’t afford to be in that business, then be in a different business.”

The most vociferous opposition to an increase has come from the Owner-Operator Independent Drivers Association, which claims 158,000 members and has spent more than $2.3 million lobbying in Washington since the start of 2015, according to the Center for Responsive Politics.

After federal officials abandoned the effort, the group declared success in “getting a potentially devastating proposed regulation withdrawn.”

In considering an upgrade, the motor carrier agency reviewed several analyses showing that claims in severe accidents far exceed the liability minimum. The Trucking Alliance, for example, reported that more than 40 percent of injury claims against its members exceeded $750,000.

The American Trucking Associations, on the other hand, submitted a study of 85,000 crashes that found the average loss per crash was $11,229.

But safety advocates say insurance minimums aren’t meant to cover average accidents, but truly serious ones.

‘Salt on a wound’

“It’s bad enough when a family experiences a tragedy in losing someone or having loved ones severely injured,” said John Lannen, executive director of the Truck Safety Coalition, an advocacy group. “It’s like salt on a wound when then you find out the company that caused this damage cannot compensate the family whether it be for medical bills, lost income or whatever.

“What happens, sadly, is these people suffer again because now they’re put in a situation where they have to rely on taxpayers, whether it be through Medicare, Medicaid, welfare, whatever it is,” Lannen added in an interview.

In the Ohio crash that killed Ed Slattery’s wife, the fact that the truck was owned by Estes Express Lines, a big firm with deep pockets, has made all the difference in his ability to provide lifetime care for his wheelchair-bound, brain-injured son Mathew, now 19, and a second son, Peter, who suffered less debilitating injuries.

Estes agreed to a settlement of more than $40-million, aimed at providing round-the-clock aid to Matthew in a new and specially equipped house.

“I’m the poster child of how it should go, I’m not the poster child for the norm,” said Ed Slattery, who has started a foundation to assist the families of other brain-injured people. “The luck of the draw is I got hit by a big company  …. that was well insured.”

Even so, he said, Matthew’s life will never be close to normal.

“He’s going to need 24/7 supervision for the rest of his life,” Slattery said. “He’s not going to college with his classmates — they’re all freshmen. They’re dating. He’s not. They’re driving. He’s not. It breaks your heart every day.”


This story
also published by:
Industrial Safety & Hygiene News



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FMCSA Steps Closer to Correcting Insufficient Minimum Insurance Requirements for Motor Carriers


Truck Crash Survivors and Families of Truck Crash Victims Support Advanced Notice of Proposed Rulemaking and Urge FMCSA to Ensure that Truck Crash Damages are Adequately Addressed

WASHINGTON, D.C. (December 2, 2014) – On Friday, November 28, 2014, the Federal Motor Carrier Safety Administration (FMCSA) issued an advanced noticed of proposed rulemaking to evaluate options for increasing the level of minimum insurance requirements and for future rulemaking. Minimum insurance is the absolute bare minimum amount of insurance coverage that trucks are required to carry in order to operate, and should adequately cover the damages resulting from a truck crash. Minimum insurance on motor carriers has not been revised for over 30 years since it was set at $750,000 for carriers of property. Increases to minimum insurance for 30 years of medical care inflation are necessary and long overdue. Current minimum insurance levels for motor carriers frequently fail to adequately cover the property damage and human costs caused by truck crashes.  As a result, private citizens are forced to unfairly subsidize motor carriers that comply with federal rules yet still lack sufficient insurance coverage. Last week’s step toward rulemaking follows decades of truck safety advocacy by families who have been personally impacted as a result of insufficient minimum insurance requirements.

Kate Brown, Truck Safety Coalition (TSC) Illinois Volunteer Coordinator and Illinois State Freight Advisory Committee (ISFAC) member after her son Graham was permanently, partially disabled in a 2005 truck crash said, “Our families’ losses are two-fold.  First, we are forced to bear the costs of a lifetime of grief and suffering when loved ones are needlessly killed and endure debilitating injuries. Second, we are forced to assume a tremendous financial burden that drains our savings and threatens our financial security.”  Brown added, “Graham’s medical bills exceeded the carrier’s insurance within the first couple of months of his hospitalization. Our personal savings and retirement accounts were sacrificed to get him the care he needed.”

Minimum insurance requirements should be increased immediately to compensate for 30 years of medical care cost inflation. Additionally, the minimum insurance level should be reassessed on a yearly basis to ensure that it is fulfilling its intention. Truck crashes have the capacity to inflict catastrophic damages on multiple victims and families. Motor carriers should be required to carry adequate insurance per claimant, rather than per crash so that each person involved in the crash has access to sufficient resources in order to cover the loss of their loved ones, their medical expenses, loss of income and loss of property.

Jackie Novak, TSC Volunteer, said, “Some segments of the motor carrier industry choose not to have sufficient insurance to cover all of their damages caused in a crash. The Department of Transportation (DOT) is aware of the gap between insurance coverage and costs, and has been exceedingly slow to issue a rule to close the gap. Every day that they fail to do so is an unconscionable burden on our families.”

Novak’s son, Charles “Chuck” Novak, and his girlfriend, Theresa Seaver, were killed in a 2010 truck crash that claimed the lives of three others. A total of 15 were killed or injured in that crash. Novak added, “The motor carrier that caused the crash only held a $1 million policy, slightly higher than the minimum now required under federal rule.”

Marianne Karth, a TSC Volunteer, after losing her daughters AnnaLeah and Mary in a 2013 truck crash that also injured Marianne and her son, launched the “AnnaLeah and Mary Stand Up For Truck Safety” petition. The Karth family gained more than 11,000 supporters seeking to improve truck safety and specifically to raise minimum insurance level requirements. The Karths delivered the petition to the U.S. DOT in May 2014.

Karth said, “We urge the FMCSA to heed the groundswell of support to increase minimum insurance levels that is evident in our petition. Act expediently! Thirty years of insufficient coverage is long enough. Families that pay such a high emotional price should not be forced to also bear the financial burden for their loss from a truck crash.”



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FMCSA Report Confirms Minimum Insurance is Too Low

Contact: Beth Weaver


 FMCSA Report Verifies Financial Responsibility Requirement Deficiency

Safety Groups and Truck Crash Victims Urge FMCSA To Act Quickly To Increase Requirement Level

Families and Taxpayers Should Not be Forced to Bear Uninsured Costs

WASHINGTON, D.C. (April 22, 2014) – Truck crash victims and safety advocates responded positively to the Federal Motor Carrier Safety Administration (FMCSA) report on commercial motor vehicle financial responsibility requirements, Examining the Appropriateness of the Current Financial Responsibility and Security Requirements for Motor Carriers, Brokers, and Freight Forwarders – Report to Congress, and at the same time rejected the Owner Operator Independent Driver Association (OOIDA) claim that increases are unnecessary. The report, directed by the Moving Ahead for Progress in the 21st Century Act (P.L. 112 – 141, Section 32104), found that current financial responsibility minimums are inadequate, and supports efforts by Members of Congress, safety groups and responsible truck industry participants to secure an increase in financial responsibility requirements.

“Over 30 years ago, Congress set the minimum insurance rule for trucks and motor carriers at $750,000 to cover everyone impacted in a crash, whether it’s two, ten or twenty people killed and injured,” said Kate Brown, Illinois Volunteer Coordinator, Truck Safety Coalition (TSC) and Member, Illinois State Freight Advisory Committee, whose son was severely injured in a truck crash. “The amount of coverage has not changed in over 30 years. During that time, trucks have gotten bigger and heavier, inflation has gone up, medical care costs have skyrocketed and many truck crashes now result in damages that exceed several million dollars. When the insurance coverage falls short, the American public is left to foot the bill for these injuries and losses like I had to do when my son was injured.”

In 1980, the Motor Carrier Act was passed in response to deregulation of the trucking industry, setting financial responsibility levels for motor carriers to “assure that public safety is not jeopardized,” and to reduce concerns that safe drivers would be pressured to cut costs in order to be competitive “…by operating in violation of minimum safety standards.”  Financial responsibility levels were to be set at a level “sufficient to require ‘on site’ inspection by the insurance company, with minimums to be updated regularly.” Unfortunately, levels were not set high enough to accomplish this goal, and regular updates have never occurred. In effect, this lowered the minimum required, and allowed undercapitalized carriers to enter the market with minimal or no underwriting from insurance companies, which is the complete opposite result that was intended when the federal government set a minimum level.

Jackie Novak, TSC North Carolina Volunteer, whose son Chuck Novak and his girlfriend Theresa Seaver were killed in a crash in Henderson County, North Carolina said, “The total number of fatalities and injuries in the crash that killed Chuck was 15. The motor carrier that caused the crash only held a $1 million policy, slightly higher than the minimum now required, which had to be split among five families who lost loved ones and ten injured, as well as all other parties who had a claim to the settlement, such as emergency responders. The insurance did not come close to covering medical costs, or providing for surviving families and children, like my grandson.” Novak added, “The American people unknowingly subsidize the uninsured costs of the trucking industry through programs such as Medicaid and Social Security. When financial responsibility is set so low, and costs are passed on to the victims, there is no deterrent for unsafe behavior.”

Marianne Karth, who lost her daughters AnnaLeah and Mary nearly one year ago in a truck crash that also injured Marianne and her son, said, “I couldn’t believe it when I learned how low financial responsibility requirements were set and that they hadn’t been increased in decades. No one, and that includes truck drivers, should have to deal with astronomical medical costs and potential personal financial ruin on top of the tragedy of losing family members. I ask OOIDA to reconsider their position on this issue, and to acknowledge that they sell truck insurance and are therefore not themselves a neutral party.” Karth continued, “My family and I have launched our ‘AnnaLeah and Mary Stand Up for Truck Safety’ petition to urge Secretary Foxx to immediately increase minimum insurance levels to, at the bare minimum, account for 30 years of medical care inflation, as well as, to address outstanding truck safety improvements. We hope to personally present him with over 15,000 signatures in a couple of weeks, and that the message we bring will prevent other families from unnecessarily suffering when there are readily available solutions to truck safety issues.”

To add your signature to the “AnnaLeah and Mary Stand Up for Truck Safety” petition, please go to:

The Truck Safety Coalition is a partnership between Citizens for Reliable and Safe Highways (CRASH) and Parents Against Tired Truckers (P.A.T.T.) dedicated to reducing the number of deaths and injuries caused by truck-related crashes, providing compassionate support to truck crash survivors and families of truck crash victims, and educating the public, policymakers and media about truck safety issues. More information is available at