How A Driver Shortage Can Impact Your Logistics Insurance
In the logistics business so much is riding on the quality of the drivers you hire. So, what happens when the supply of qualified drivers is limited? While it may be tempting to hire less qualified drivers, that move could seriously impact your logistics insurance coverage in the long run.
Insurance providers put a heavy burden on logistics companies to show they have done due diligence in hiring good drivers who have a solid driving history. Employee records on each of your drivers with documentation showing they meet all regulations go a long way in helping you get an affordable premium.
If you have not done due diligence in hiring your drivers, your insurance provider may see you as high risk and quote you higher premiums or decide to cancel your policy altogether.
To avoid a spike in premiums or a policy cancellation, it is important to maintain high standards when hiring drivers. Here are four areas where you should never compromise in your hiring process:
- Driving experience and previous employment history
- Check driver abstracts (CVORs)
- Perform reference checks. Showing a driver has good references can go a long way if the driver is ever in an avoidable accident.
- Document the driver’s previous training as well as what training they will need in order to work for your company.
Evaluating drivers in these four areas will help ensure you hire the most qualified drivers for your business. It will also show your logistics insurer that your drivers have a history of safe driving practices.
Keep Good Drivers Happy
High driver turnover can be a red flag for your insurance company. That’s why it is in the best interest of your company to keep good drivers happy. Listening to your drivers’ concerns and addressing issues as quickly as possible not only shows your employees you care but is a smart move financially for your company.
If you suspect the quality of driving applicants could impact your logistics insurance rates, talk to your broker to see how you can reduce your risk and keep your premiums affordable.
3 Ways to Lower Your Company’s Trucking Insurance Premiums
For most fleet owners, trucking insurance takes a notable chunk out of the annual operating budget. That’s what makes it such an attractive place to search for discounts and savings. While the best way to keep premiums low is to stay claim free, that option is not always realistic. Here are three practical steps your company can take to put insurance premium dollars back into your budget.
1. Recruit the Most Qualified Drivers
The quality of the drivers you hire can have the most significant impact on your trucking insurance premiums. To ensure you have a strong recruitment and training program in place, schedule time to talk with your insurance broker about your efforts and ask for recommendations for improvement. Also, be sure to document your process for keeping drivers abreast of the latest regulations, laws, and safety practices.
Evaluating driving candidates in on-the-job situations before sending them out on the road not only allows you to see them in action, but it also lets your insurance company know you are committed to performing due diligence. You may even be able to partner with your insurer to perform personal and professional background checks on candidates.
2. Share Your Success Stories with Your Insurer
If the only time you talk to your insurer is when you need to file a claim, then sadly, your insurance company only hears about what went wrong from you. Why not tell them about all the things you are doing right? For example, if you have recently implemented a new safety program, let your insurance broker know. Your broker will share your efforts to improve fleet safety and work with your insurance company to identify areas where you can improve.
3. Re-think Your Safety Strategy Now
Do not wait until you start racking up negative safety points to take a good look at your company’s safety practices. Work with your insurance broker now to start evaluating your staffing and risk management plans.
Regardless of your claims history, taking these three steps can help with your insurance costs.
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