If you’ve been outside these past few months, you would have noticed a few changes in traffic flows. There are fewer cars on the road, and a whole lot more trucks, vans, 8-wheelers and other delivery vehicles. This just goes to show that there are blatant differences in traffic today than just one year ago. A little digging will reveal the more implicit trends in auto trends, particularly, in commercial vehicle trends.
But why should you, your church, or your non-profit organization care?
Commercial vehicles are useful in many ways to many kinds of organizations. From transporting materials and tools to work sites, deliveries, or meeting clients, business transportation is an essential component of the logistics of both for-profit and non-profit organizations. Perhaps your organization has (or is thinking about) commercial auto insurance - a great way to financially protect your fleet of vehicles and drivers. In that case, you will want to know what factors and trends will affect your premiums as well as the changing risk landscape in the years to come.
Insurance carriers have been really (and we mean, really) struggling in the commercial auto insurance segment for years. This could be tied to a number of reasons from medical inflation and worsening road infrastructure, to poor driver safety and increasing accident expenses.
In such a hard market, it may be harder for you to obtain commercial auto insurance due to the rising premium costs, lowered capacity of the plans, and rigid policy requirements. But the benefits of having auto insurance far outweighs the cost and your organization would be better off being properly protected against losses.
It is predicted that during the next decade, more than 150,000 commercial driving positions will be left wide open. Why? Because of the increased demands in freight and delivery that have resulted due to the many lockdowns worldwide. To add to that, the sector is made up of a rapidly aging workforce with much longer shifts than before.
What this means for most organizations is that they need to spread their nets wider - resulting in lower driver applicant standards, fewer years of experience, less training, shorter driving records, and more driver fatigue. This increases the likelihood of newly hired employees having accidents on the road, and ultimately increases the cost of premiums.
The COVID-19 Pandemic
While the initial lockdowns meant fewer vehicles on the road and thereby fewer accidents, accident severity has increased. Due to the false security of reduced traffic, drivers have become more reckless, overconfident, and careless on the road (by speeding or multitasking), resulting in much more serious accidents.
On another note, as mentioned earlier, those organizations that have been able to remain open have needed to increase their delivery capabilities or hire commercial drivers for the first time ever. This increases their exposure to accidents (and the aforementioned risky driving behaviors) - with new drivers comes new responsibilities, meaning commercial auto insurance needs and claims are on the rise.
To handle the increased demands for delivery capabilities, several organizations have chosen vehicles with newer technology to increase safer, more efficient driving. Telematics is a new form of vehicle software that combines the features and benefits of telecommunications and informatics to help owners manage their fleets better. By using GPS technology, sensors, mobile apps, and even dashcams, you can keep an eye on your vehicles, maintain contact with drivers, track speeds and locations, detect maintenance concerns, and more.
This is one of the few trends that will minimize premium costs, since telematics can increase driver safety, reduce risky behavior, and reduce the amount of accident claims - meaning your commercial auto insurance will eventually cost less.
Wow, that sounds like a lot to look out for right? Yes, but you don’t have to engage with these commercial auto trends alone. We’re here to help you figure out whether or not commercial auto insurance is what you need and what plans best suit your organization.
If you have an insurance problem, Carriage Trade Insurance has the solution - contact us today.