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SPECIALTY LINES MARKETS
Is the road getting less bumpy?
Motor carrier business experiencing modest shifts
By Dave Willis
He believes the way agents can shift to selling value is by knowing their product and understanding their customer more and selling differences. "A lot of our forms are pretty much the same," Setters notes, "but there are options.
"You have to look at the quality of the carrier," Setters explains. "Does the carrier provide loss control services? Are you comfortable with the company's integrity and expertise? What is the strength of the insurer's paper? These are all factors agents and brokers need to consider. It's very important to find a carrier that is outstanding at claims administration and that can resolve claims and get damaged equipment back on the road quickly."
Setters encourages agents and brokers to work closely with insureds and prospects to understand their business and share this knowledge with insurance markets. "Agents need to be involved in surveys," he says, "because they represent that customer. To reach out to the market for good, accurate quotes to cover the exposures requires good survey work."
Agents and brokers are responding to industry and market shifts. "Agents are really making sure that, as customer needs change, they adapt," says Lawrence. "As insureds are adding new equipment and adjusting their driver base, agents are making sure they're properly covered."
"It's really about taking care of customers and being there to meet their needs," she adds. "Whether it's helping them with CSA or just being there to help with changes so they can get that next load and stay on the road, it's definitely about customer service and being transportation experts for those motor carriers."
According to Lawrence, meeting customer needs requires a combination of automated and personal contact. "Technology plays a part, particularly in terms of speed of response," she notes, "but in the trucking industry, it's about that personal relationship and direct contact."
Sager concurs. "As a company, we evaluate how we service agents and are constantly looking for ways to become easier to do business with and give agents tools they need to service their insureds," he explains. "But trucking is still extremely relationship driven. The trucking community values that."
More and more, technology is part and parcel of trucking and driver interactions. "Drivers are carrying iPads and national coverage iPhones," he adds. "Information delivery, such as weather and traffic and more—has totally been transformed. Technology has changed their lives.
"They use Facebook to keep in touch with family and friends," he says. "If it's a useful application, whether it's an insurance app or Facebook or something else, they will use it if it works for them."
Parting advice
Sager is optimistic about the trucking market going forward. "The industry certainly experienced significant contraction over the last several years," he explains. "The net effect of that is that the remaining players are relatively healthy. And that's good news."
Adds Setters, "Agents and brokers definitely can succeed in this market. All companies have
their own recipe and their own approach to handling the business, but agents that understand the markets can do well. Those that
do great survey work and develop relationships with customers will be the winners."
Lawrence concludes, "Those agents and brokers who go above and beyond will do well."
Como asegurar Transportistas en México
According to U.S. government data, the United States is Mexico's largest trading partner, buying more than 80% of Mexican exports during 2010, and Mexico is the third largest U.S. trading partner, after China and Canada. Bilateral goods trade between the two countries topped a third of a trillion dollars in 2010.
Recent developments governing implementation of the North American Free Trade Agreement between Canada, Mexico and The United States will open up added opportunities for increased cross-border trucking. Today, Mexican and U.S. trucks hand off loads at sites near the border.
"Changes have been approved, and we're just waiting for them to be implemented," says Jorge Cacho-Sousa, CPCU, ARM, chairman of MexiPass International Insurance, an organization that facilitates insurance for U.S. vehicles operating south of the border. "That should take place in 2012.
"Now is the time to start raising awareness of the differences," he adds. "The main thing to understand, beyond the fact that U.S. policies stop at the border and Mexican law requires insurance—or in Spanish, "Seguros"—be purchased through an admitted company, is that more U.S. trucks will be going into a country that has a dramatically different legal system, different roads and different standards."
Another world
Unlike Canada, where fewer differences exist, liability exposures are vastly different in Mexico. "Mexico is not as litigated as the United States," Cacho-Sousa notes, "so the liability exposures are not as great. Premiums reflect that.
"At the same time," he adds, "physical damage, especially theft, is a much higher risk in Mexico than in the United States. This applies to the units and their cargo."
Road conditions aren't the same south of the border. "Mexico has a good system of what they call their "autopistas de cuota," which are toll roads," Cacho-Sousa explains. "They are normally better protected." Beyond that, road design and standards are less consistent.
"The design is different and maintenance is not up to U.S. standards," he adds. "From signs to general road conditions—including potholes—to truck stops, it's important to be aware that things in Mexico are not the same as what we're used to here in the States."
Driving performance varies, as well. "In the U.S., we normally have greater law enforcement," Cacho-Sousa says. "Penalties and enforcement are less stringent in Mexico, and the way people drive reflects that. Vehicle safety is not as strict either. I was traveling in Mexico recently and saw a couple of trucks without lights on at night—something you'd rarely see in the U.S."
Managing risks
Agents with clients looking to haul goods in Mexico need to understand they are "getting into a different reality," Cacho-Sousa notes. "That requires not only insurance coverage, but also risk management techniques to prepare U.S. truckers to know what to expect going in."
At the top of the list is driver preparation. "A lot more defensive driving techniques need to be applied," he explains. "And safety awareness is key. Companies need to understand the security risks and have procedures in place that will protect drivers, vehicles and cargo."
One approach insurance companies suggest is that truckers stay on toll roads whenever possible. "Also, there are some specific recommendations around driving times and hours," Cacho-Sousa explains. "They discourage driving at night, which is a significant change for a lot of truckers.
"Depending on where they are going and what they are transporting, sometimes there's a requirement that truckers have some type of escort or follow-up vehicles, and that they maintain constant communication via radio, because cell phones don't work in some parts of Mexico," he adds.
Paying attention to trailer positioning and cargo security during stops is also an important step to reduce trailer and/or cargo theft. "Tracking devices and GPSs are also tools that truckers should use to help protect property," Cacho-Sousa notes.
In the end, he explains, it's important that American interests have proper protection and insurance in Mexico. "By understanding and offering sound risk management advice and tapping a reputable insurance partner, agents and brokers make sure their clients and prospects are properly protected and safe," Cacho-Sousa says.
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