Hi, welcome to Inland Marine Underwriters Association's class, Introduction to Inland Marine Transportation Insurance. I'm Lillian Coulson, and I'm thrilled to introduce today's session. Today is the second day of a series of four sessions that IMUA will offer virtually. Hopefully, you can join us for the remaining sessions on Monday and Tuesday of next week at the same time using the same link, and the time will be from 2 to 5 p.m. Eastern Time. A PDF of the presentation is available from the handout material icon or tab located on your control panel. Please use the question box on your control panel to ask questions. If you will find your control panel has minimized by default, simply right-click the orange arrow to recover access to your control panel. Our instructor today, Diane Springle, will announce a 10-minute break about every 50 minutes. Diane looks forward to your questions today, and we encourage your participation. At the end of the class, Diane will select an engaged attendee to receive a $25 Amazon gift card. This is to keep it fun and interactive, as well as to show a little attendee appreciation. Just a quick reminder to please be aware of IMUA's statement to remind all to refrain from entering into any discussions during the Q&A on affecting rates or conditions of insurance contracts. Now, let's get started. I'm honored to introduce Diane Springle. Diane has been in the insurance industry since the early 1980s, and she started her career underwriting highly protected risk property in the Chicagoland area. She later moved on to property risk with an inland marine emphasis, landing on inland marine exclusively as a marine manager for a national carrier in the mid-1990s. Diane has handled many positions throughout her career, from production underwriting to management marketing and sales. She's currently business segment manager for selective insurance, handling the Midwest territories. Fortunately for IMUA, Diane is a huge supporter of the inland marine insurance industry and IMUA. In 2021, Diane was one of the two subject matter experts who developed the highly rated introduction to transportation e-learning course, which is available on our new learning portal at no cost to IMUA members. In Diane's spare time, she enjoys traveling and spending time with family and friends. Please join me in giving Diane Springle a warm virtual welcome. And just, Diane is experiencing bandwidth issues today, so she will not engage her camera. And now I'll turn it over to Diane. Great. Thanks, Lillian, for the introduction. I appreciate it. And I appreciate the fact that you guys will be accepting the fact that you can't see me today, but I didn't want to get stuck in the middle of this presentation and then freeze up on you. So that can be annoying. So, hey, welcome to the class. Thanks for attending. Today, as you know, we're going to be talking about transportation insurance. Here's kind of an overview as to what we're going to be talking about. Different types of elements of coverage, kind of the history of transportation, underwriting considerations that should be looked at from both if you're a producer or an underwriter. When you get questions, you'll know why and what an underwriter will look at. Different exposures and how that might lead to various severities. Financials are important when it comes to looking at transportation insurance and losses also. Forms and coverage. There's a lot that we all share from different companies. So it's always good to look at whatever carrier you're dealing with, what their form and coverage looks like. Some references for you at the end. And there's a case study at the end. So we're just going to kind of touch on it. There'll be something for you to think about after the class so that you can see how much you've learned and go back to the previous information and get a better idea as to how you would look at the risk, maybe differently than you would have from the beginning of the risk. So an overview. So basically the nationwide marine definition is the same with respect to any kind of marine coverage. It's defines and classifies what marine and transportation underwriters go under. So in this course, we're going to be talking about inland transportation. So if you have anything that's going via water, even if it's rivers or lakes or overseas and anything that goes overseas, that would be considered ocean marine. And we're not really going to get into that during this presentation. So we're going to basically focus on what is considered inland marine. Throughout the definitions, it talks about that it must be in transit to be covered under a transportation form, which makes sense, right? It could be via their own trucks. It could be via someone delivering it for you. And we'll get into that a little bit deeper in a few minutes. And it can be moved different ways. It can be via railroad, by trucks, by air, and even bicycles. Think of messengers. With COVID and the changes in how we live and breathe nowadays, you can get deliveries. We're not going to talk about drones, but that's coming, right? We're already seeing them testing that. So that would be another way for them to cover different items. This is a nice picture. It kind of shows you the different modes that we just mentioned. Know that the cargo ship you see on the upper right, this has evergreen on it, and the air transportation on the bottom left tend to be covered more on ocean carriers. Those items tend to be overseas, but anything that's over physically water would definitely be ocean cargo. But you see the messenger making his little delivery, could be food, could be different products, could be anything nowadays, right? And then your truck and your train. So knowing the history of what transportation is, it's always nice to know where we came from. We never hear the consign your, consign ye really discussed. But basically back in the history of it, the owner of the shipper of the goods is considered a consign your, they're the ones who own it and they're shipping it to their customer. The person that's buying it or receiving the goods is a consign ye. Then you have a cargo broker that may be the one that determines how this cargo is going to be, how the cargo is going to get from point A to point B. And then you have the carrier. So it could be a common, so common carrier, we'll get into a little bit further within this course and we'll reinforce it. So a common carrier can haul for whoever. So it could be for a manufacturer, it could be for a distributor. They get hired by the public to transport their goods. Then you have a contract carrier who basically is contracted out through specific avenues. So let's say you have a manufacturer that doesn't have their own fleet of trucks, he might hire a contract carrier that will deliver all their product for them wherever it needs to go. Then we have air, rail, and courier, which we'll get into a little bit different. Air and rail, even the couriers are a little bit different in the fact that the rail especially and the air fall under different laws, different rules. It's handled differently. Couriers, sometimes if it's like same day delivery, if it's fast, if it's something that's a harder good to ensure might be under a different contract. So when it comes to air, rail, and courier, there's some carriers that will provide limits for that. Some of them will provide smaller limits for it just so that it's not silent, because you can get air, rail, and courier coverage through specialty markets. And then you have freight forwarders, which will take goods, consolidate it, and send them out. They don't touch the goods, they arrange for the transportation. They basically are, it's almost like a paper operation. So if you think in construction terms of a paper contractor, your freight forwarder is basically your paper forwarder. They get the goods in and they determine where it's going to go, but they don't physically haul the goods themselves. So let's talk about, we were talking a little bit about history. So basically the Carmack Amendment when it came out was a federal law that regulated the liability of the shipping companies. It basically was done to simplify state laws, and it was done to try to create some uniformity within the industry so that everybody kind of was following the same rules and regulations. So that's when it was first started. It's important because it determines what people can do and what people can't do, and what the different liabilities could be. Then you segue into the Federal Motor Carrier Safety Administration, or FMCSA, and that was basically established to primarily reduce loss or reduce crashes and injuries. So it was more a way to look at and protect these truckers that are over the road and make sure that they're operating safely and efficiently. So you have the SAFER report, which is basically a report that tells you how they're operating and what their operation looks like. We're going to get into filings a little bit later, but different motor truck carriers, back when I first started in the industry, every single motor truck carrier used to have to have a filing. It was a form H filing, it had to be done by everybody. There was a fee assigned to it. It had to be taken care of. And then years later, they did away with that, and you don't see filings very much from a cargo standpoint anymore. Pretty much the only ones you see it for are household goods carriers because they fall under different regulations and they have different endorsements. So again, we'll get into that in a few minutes. But that kind of is the difference as to how we evolved from getting some regulations so that we were all kind of doing the same thing, and the states were all looking at the same laws into then getting the FMCSA to come into play to keep things safer for the drivers that are out there. So underwriting. We all have to start somewhere, right, and look at what we have, and any company, person that you deal with, and any underwriter is going to kind of go through the same processes or should be going to through the same processes. So you have to know who your interests are. Who are you trying to protect? Are you protecting the manufacturer, the distributor? What coverages do they really need? Are they looking for cargo? Are they looking for transportation? We're going to get into the differences between the different types of transportation coverage out there. What kind of commodities being hauled? Every company has charts that talk about what commodities have higher hazard or lower hazard, and the determination of limits provided by that company are going to be determined by the severity and what the commodity is being shipped. We'll be talking about some shipping of high hazard goods and how those items are looked at. Know how these goods are being shipped. Are they being, are they common carrier? Are they contract carrier? Does insured have a fleet of trucks and he's transporting the items themselves? How are these goods being shipped and what percentage of their goods are being shipped each way? The volume, how much is shipped annually? So we need to, you know, you underwrite it and you base your premium on how much is shipped and by what conveyance. Your average and maximum values. Set your limit. High enough to protect you for all your goods being shipped on any one single shipment. Usually you have a limit and then you have like, let's talk motor truck cargo. So you hire a common or contract carrier. You need a hundred thousand dollar limit or your transportation company and that's what your business is. You have a hundred thousand limit, but maybe you have two trucks in the same area. So you're going to have a hundred thousand per conveyance and with a 200,000 maximum so that you can accommodate more than one vehicle. One of your vehicles being at the same place at the same time. What kind of, what is your, what are your contracts look like? And we'll get into your different bills of lading later on and how will that financially impact your organization while your stuff is being transported? Is it selling price? Is it cost to reproduce? What is the liability that you've agreed upon having your items shipped? The origin and destination, when is your carrier responsible for what's being transported? Is it when it leaves your manufacturing operation or you as a manufacturer distributor, you want to keep the insurance on it until it gets there? Lost history is always important in underwriting. As an underwriter throughout my career, first you look at what the insured does. You look at the commodity that's hired, especially in, or being transported, especially in transportation. And then you look at the losses and you want to make sure that if the losses are bad, why are they bad? Like any other underwriting process for any other line that you're going to write, right? Have they done anything to protect it? Have you seen things get better or things gotten worse? Have they put different GPS or sensors or locks and controls on it to prevent theft if that's an issue? And then understand what different potential there is for separation if there's a loss. If someone causes that loss, can you go back against that other person that might have had a hand in the loss that has happened? So types of transportation coverage, I mentioned this a little bit earlier. We have owner's goods on owned vehicles, so you're a manufacturer and you're shipping your goods. That would be considered transportation or annual transit. It's called different things, but think of it as transportation. You own the goods and it goes on your own vehicles. It could also be your goods on vehicles of others. So you're a manufacturer, so it's your goods, and you're hiring a commoner or contract carrier to deliver your goods. That would also be considered transportation because you own the goods. You're not a trucking company hauling goods for others. Trip transit, we don't see as much trip transit now as we used to years and years and years ago. Trip transit basically is one, usually a large shipment that goes from point A to point B. It's very specific as to when coverage begins and ends. You start with a beginning date and a beginning location, and that goes on your endorsement. And then there's a period of time, usually a few days or maybe a week, and it ends at the new address at a separate date. So there's a point A to point B, and it's very specific. A lot of times now, I think insureds are a little more savvy, and they try to hire like a commoner or contract carrier if they have a big shipment, and they make sure that that company that they're hiring has sufficient limits to cover whatever item that they're expecting to be hauled. So let's say you have a manufacturer, and he decides to buy a new piece of equipment, and it's being delivered from five states away, and it's going to take four days to get there, and the limit's higher than whatever their annual transit limit is on their policy. They might need a trip transit limit to get that item to their location. I never understood as an underwriter, or even as a consumer, you buy something from someone, why would you take responsibility for that item until it ends up at your doorstep? So if you're having an insured have a big shipment, or order a new machine, or have something come to you, you definitely want to make sure that, number one, if you can get a company that can cover it. Number two, your trip transit, you're not going to find very many companies out there that will do it on a monoline basis. Really, it's in conjunction with the package that you write for your customer, and it can be done. So it's a higher premium, but you have a big exposure for a short period of time. Again, you're not going to see a lot of it. It does come up occasionally. Probably in the last 10 years, I've maybe seen three. So again, I think we're getting smarter as consumers, and our insurers are getting smarter where they're having the person that's bringing it to them have the proper insurance in place. Then we get to motor truck cargo. So motor truck cargo, basically, is you're a trucking company, and you're being hired to haul a customer's goods. So you don't own the product, you're not a distributor, you're not a manufacturer, you're a trucking company that's being hired to haul goods from others. I was having a conversation with Eileen just before we started, and I don't know where this came from, but in the last six months or so, there's been some confusion within the industry as to the difference between transportation and motor truck cargo. I've seen companies ask for insurance, ask for motor truck cargo when they're a distributor, and they're hiring common or contract carriers, but it's their goods. They're getting their goods that they're selling delivered to their customers, and they're hiring trucking companies to do it. They're not a trucking company. They're not hauling for goods of others, but we're seeing this happen more and more. So just remember, if it's your own goods, so you're a distributor, you're a manufacturer, you're a retail operation, you sell goods to the public, and your goods have to get to your customers, that would be transportation coverage. It doesn't matter if it's on your own vehicles or vehicles of others. If you're a trucking company, and if you're hiring somebody, let's say you're a retail operation and you're hiring somebody, let's say a trucking company to take your goods somewhere else, you're the company that they're hiring, that would be motor truck cargo liability. It's between a broker or a customer and this motor carrier that's shipping it for you. So if you remember anything from this, remember transportation is you're sending your goods out and motor truck cargo is you're hauling goods for others. So I think that, I don't know why that became an issue. I just think it's interesting. I just did another transportation session and I made sure that we talked about it and we'll probably hit on it a few more times just so that you know. Railroad is different. They have different laws and regulations. I've worked for companies where we wouldn't provide any kind of railroad coverage because you can get it through the railroad companies themselves. The rail companies have their own insurance product. I'm not even exactly sure how that works. And I've also worked for companies that have given like maybe a $10,000 limit just so that it's not silent and protects them. It can protect a small piece that might be going on railroads. Same with air shipments. Air shipments is the same way. There's different coverages that can be covered. I don't do a lot with air shipments. A lot of times when you see things going by planes, it's going overseas and it would be covered under an ocean contract. Same with inland waterways. There's blue water and there's brown water. So blue water would be your lakes and your oceans and your brown water would be rivers. So think of anything going down in Mississippi or going down different rivers throughout the United States. That would not be something covered on inland marine. That would be ocean marine. But that's just different ways that product can go. Combinations. So intermodal, they're showing an intermodal container. We all see them on trains. We all see them on the back of semis, on the trailers. So it could go from a ship, get to the United States, and then need inland transit to get it from a port to its final destination. And then there's also the freight forwarders, basically legal liability. Motor truck cargo is legal liability too. It's third party legal. The determination of liability is based upon the shipping agreement, which we'll get into a little bit into soon. Now I see that there, Julie asked a question with respects to the Interstate Commerce Act of 1887. I think that segwayed into the CARMEC in 1909. And I don't know that history well enough. So I'm sorry, I don't have a firm answer on that one of it, on that question. But if you look up, if you look it up on Google, it'll explain, but I think it's the interstate segwayed into the CARMEC. So I know that's not a very good answer, but I don't know that history off the top of my head. But good question. Thank you. Oh, it was a question of, oh, yeah, there is some discussion slides. And so thanks, Julie, for clarifying that. I'm going to go over some of those, and then we're going to skip other ones. So and then that one, I'm just going to skip over just because I think with the CARMEC and the FMCSA that we're where we're at now with respects to how cargo and transportation is handled. So your types of voter carriers, your common carrier, as I mentioned before, is basically someone that's going to deliver for the public. They can deliver for whoever they need to deliver for. So let's say you have a distributor and they don't have enough room on their trucks, it's the holiday season like it is now, and they need help. They can hire a common carrier to take a few shipments here and there, the public can hire them. Then you have a contract carrier who basically is issued a permit or basically they go into an agreement with a specific company just to handle their goods or handle their like almost like a permanent customer where they're they contract through different companies to hire for to haul goods for them. So companies can be both. You might have a contract carrier that has a let's say it has a an agreement with a bus buy and they'll transfer transport their goods from warehouses from point A to point B, but then they also can pick up other jobs and act as as a common carrier and haul for other people if they have the capacity to do so. We have exempt carriers, they're exempt from the normal rulings. A lot of times it's bulk. So think of livestock, which is a different commodity. I've not really worked for companies that have actually covered livestock as a commodity because it's a specialized carrier or bulk goods. Think of sand and gravel, think of things that are on bulk agricultural. They can be exempt from the rulings because they're usually they don't go very far and they don't need the filings that maybe someone else might need with respects to the goods carried. Household goods carriers as a rule are not generally covered in a standard market. There's different forms in terms and conditions under a household goods carrier that are specific to what they do. Valuation tends to be an issue. Everyone thinks, oh my gosh, grandma gave me this box and it's an antique and it's it's been in the family for generations when in reality, maybe she got it from the dollar store, but it looks fancy or home goods and it looks fancy. So it's hard. It's hard to put a value on the goods carried. And it tends to be done by specific carriers. There's transportation, there's insurance companies out there. That's all they do is they insure household goods carriers. So you probably won't see very many of those unless you're in a specialized area or if you're an underwriter working for a specialized carrier, maybe you'll see them. As an underwriter doing this for as long as I have, I haven't worked for any standard company except for one where by mistake, we wrote some cargo on some household goods carriers, but that was maybe 20 years ago. We just don't have the filing capacity or the forms in a standard market generally cover what they need. And then you have the air carriers, again, they're under different rules and regulations and most standard companies don't insure domestic air carriers. A lot of times the goods being transported via air are covered under a different policy form, maybe an ocean form. So this was a kind of a chat question. Can anyone think of a prevention for an act of God event? It's kind of hard. I think that's just more philosophical than anything else. How do you stop a tornado from happening? How do you stop a hurricane from happening? How do you stop... I mean, you might be able to reinforce your trucks, you might be able to know that a storm is coming and prevent things from happening. But the more prevention is probably keep the trucks off the road more than anything else, or put your goods in a place that's protected or get them out of harm's way. Just like when you have property that might be in a flood area, if you know that the rivers are rising, do you have the ability to get that product or the goods being transported out of harm's way? The good thing about transportation coverage is it's mobile in nature, just like contractor's equipment. And if you know something's coming, you can get it out of harm's way. So acts of God, earthquakes, floods, it can be a defense. But most of the time, if a loss happens for that exposure, it generally is covered. Flood and earthquakes aren't excluded under transportation form. But again, you hope that they can get these goods out of harm's way. And earthquakes, you have a bigger exposure from something falling on a truck than things being damaged during an earthquake, because trucks and trailers have pistons and things on them so that they don't shake and cause damage. But those are some of the defenses available. Acts of God, I mean, acts of public enemy. It's like war and things you prevented from going in and out. It's pretty much excluded on a lot of policies. You see that under property policies also. If they shut something down, can you get to it? Is it protected? So acts of God are generally excluded. Same with public authority, same thing. If they confiscate or something happens, fault or neglect can be underwritten into your policy. Your bill of lading won't get into differently. And then inherent vices like anything else, something that helps to destroy each other. So let's say you're hauling flour for somebody, and then the next shipment you're doing fertilizer, and you don't clean your truck out well enough, have you cleaned out your truck well enough, they can make an argument, hey, they just did fertilizer, and now they did food products that got contaminated. That could be a defense for actually the customer. But if you've got grain, and there's bugs in the grain, and they get the grain to where it's at, and it's infested with that, it could be it was inherent to the goods before you got them. And that could be a reason why there could be no payment. So since it's legal liability, there's different interest in the goods and what the interest is going to be paid. So you have shippers' interest. So that addresses the difference in what the transportation company is responsible for. So let's say it covers the goods for loss against the motor truck cargo carrier, and then it subrogates against others that might have helped cause the loss. And let's say you have a company that's helping you pack goods, and they don't pack the right way. And there's a loss to goods because things broke. The shipper is going to make the customer whole, but then subrogate against the person that packed it for maybe improperly packing something. And then there's always subrogation. There's subrogation, I think, in any line of business that we write. You always think of it as property because you're transporting goods. A lot of these perils or a lot of these subrogation opportunities are the same with respects to transporting the goods because you're thinking about what the final good is themselves. So we're going to go back to something I talked about earlier, and we're going to open this poll. Let's see if I do this right. Oh, I launched it. I haven't had to launch one of these. So the party, who is the party in a contract that owns the goods? We talked about where the history came from and where the wording came from and what it actually means. And boy, you guys are really fast. So we appreciate that. I'm going to let this go a minute or so so that we can get the answers in. And this is our first polling question. We have like 37 seconds left. It's interesting to always listen to where the history of the wording comes from, but I'm guessing a lot of you have never even heard the words consigneur and consignee before. Carrier makes sense, and freight, border, you hear freight all the time anyway. So Eileen, I'm not sure how long this poll goes. Is it two minutes? Oh, no. It's results. Okay. So we're done with the poll, and the answer to this is consigneur, 70%. That's the correct answer. That's a person that pretty much owns the goods, and then the consignee is a person that's delivering the goods for the owners. So great job, everybody. Over 70% of you got that question correct. So great job. Thank you. Okay. And we'll keep going. So let's talk about when coverage begins and ends. It can be different ways. It can be just when it's in the custody of the carrier that you hire or your messenger that you hire from a motor truck cargo standpoint. It could be until the property is delivered to its final destination. Let's say they try to deliver it, and it can't be delivered for whatever reason. It will generally be covered until it gets back to you. So let's say it goes to an address, and for some reason, they can't get it to the person. Generally, your contract is going to be until it gets delivered back to the original owner. Or its coverage is when it's held in temporary storage. Let's say you have a shipment of goods, and it goes to a terminal location, and they might split up part of it and send it on different trucks to go to different locations. So your bill of lading in your contract is going to tell you when it starts and ends. I mentioned earlier, as a consumer, I don't know why, if you're buying something, you would take responsibility before it even gets to you. Same goes with someone that's a distributor or a manufacturer. If you're sending your goods or you're buying product to help make your widgets, let's say, why would you take responsibility for something until you get it? So generally, the coverage begins when it's in the custody, until it's delivered. If it's not delivered, it's still returned, and while it's in temporary storage. Loading and unloading can or cannot be a covered apparel. I've worked for companies where it's included in the coverage form, and I've also worked for companies where it's not included, and you either have to add it back in, or it's just not covered at all. So we always encourage everyone that looks at transportation or any other coverage to read your policy form of the company you're dealing with, and it will tell you whether it's covered or not. I tend to look at the forms anyway, because I've worked for so many different companies over the years, just to make sure that I know for sure if those goods being loaded and unloaded are covered. It seems more and more companies are covering it, but usually, it can be underwritten back on if it's not. So we talked about bills of lading. So basically, that's a shipping receipt. It outlines the terms and conditions as to what's being hauled for you. So it's a document that's a receipt from the carrier, so a motor truck cargo company that's hauling for you. It's a receipt between the carrier or the cargo carrier and you for them shipping your goods. It will set forth what the responsibilities are. You have a released bill, which basically sets a certain dollar amount in this contract, and that's all they're going to pay, regardless of what the goods are worth, that they're being shipped, but there's going to be a certain dollar limit assigned to it. There's a straight bill of lading, where it basically puts no limitation on the value. It just specifies whether the shipments are going to be prepaid or are they going to be collected. So normally, there used to be a lot of COD, cash on delivery, so you ordered a good and the transportation company delivered it to your door and you had to pay them when you got the goods. It's not really done that way very often anymore, but it can be done for certain reasons. Maybe it's a big shipment, maybe it's a certain customer, that's how they do it, but as a general consumer, you're not going to see it that often anymore. You're going to have an order bill of lading. This basically, you're not going to get the goods until they're paid for, so that makes sense, right? But most of these bill of ladings, the documents will outline what it is. And then the through bill of lading, it basically covers it regardless of how it's being carried. So maybe it's going to be by, you know, it comes in from, it goes on the train for a little while and then it goes to the back of a trailer and then it's shipped by a UPS truck until it gets to your door. It's going to cover that shipment, however it gets to you through that whole process. And then the carriers that are handling it are liable with respects to their portion of that transportation of that good that gets to your door. The standard one that we see most is this is the standard bill of lading, which is basically your standard contract. So we mentioned too, when does a seller assume responsibility for the loss? Are they going to have their, the point of origin, basically the seller or the distributor or the manufacturer is going to cover that good until it gets to its customer's doorstep. Oh, I'm sorry, it'll, okay, I'm backing this up. So the point of origin, it has a seller. The seller assumes responsibility until the good gets to where it's going. So the buyer, the buyer is responsible for the loss. So the seller says, hey, it's on the truck, I'm not worried about it anymore. You, my customer, have to be responsible for it when it leaves my doorstep. It's your responsibility. Destination, the person selling it takes responsibility until the delivery is made. I always think the destination one is the way to go at any time. I think the point of origin where they basically say we're not covering it once it gets on the truck is when we see the trip transit issues come into play, when they have a big shipment and the person selling it doesn't want responsibility once it leaves the doorstep. Most of the time we see FOB destination where these goods are covered either by the seller or the motor truck cargo company until it gets to your doorstep. So again, think of all the goods we order from different shopping channels. I mean, I think all of us probably did a little bit of like Friday shopping and Cyber Monday shopping over the last weekend. Especially I live in the Midwest, in the Chicago suburbs, and it was really cold. It was easier to sit in front of my computer than go out, right? But I don't want to be responsible for it. I want the person I'm buying it from to be responsible until it gets to my doorstep. So most of the time you're going to see the destination come into play. So insurable interest, who's responsible? Is it, it could be the party that bears the risk of transport. So basically that means it's your motor truck cargo company is the one who's going to be responsible for it. Is it your seller? Is he going to, he does have insurable interest because it's his goods until usually it gets to where it's going. And the bill of lading or the way it's being shipped might have responsibility for it so they have insurable interest. Same as a seller. The seller also has it while it's, if it hasn't been paid for yet and it gets to the doorstep and the buyer has not been able to pay for it and there's a loss, the seller is still going to have interest in those goods because it still technically could be his stuff until the buyer actually pays for it. The buyer might have responsibility, right? It's his goods. He might decide that he wants to have it for when it leaves his, where he purchased it from, which you don't see as much anymore. The bill of lading will also tell you, hey, this is one is responsible from point A to point B and when you receive it. And then there's also, again, when they talk about contracts and agreements on this, it's based upon what the bill of lading, for a transportation company, a motor truck cargo carrier, it's going to outline exactly when they're responsible and what they're responsible for. If they're a distributor and they're shipping stuff on their own trucks, getting it to their customer, they're pretty much going to take responsibility and be, it's going to be in their interest until it gets to their customers and the stuff has been fully paid for and the title moves over to the new people. So it gets a little bit sketchy when you're going in between motor truck cargo and transportation when you talk about this. But again, motor truck cargo is, that's what their business is. They're a trucking company hauling goods of others. Transportation is them shipping their own goods via their own trucks or via other modes of transportation. So insurable interest can vary depending on how it's being shipped and who it's being shipped for. It could be invoice costs. These are different ways that your bill of lading is going to say. It could be the cost of the goods, the market value of the goods, plus the cost of freight. Because it's third-party legal, the types of damages that wouldn't be covered might be ex-of-god, might be ex-of-war, it might be they can't get into a certain area because it's being restricted. So the valuation and the liability is going to be spelled out and talked about and outlined in what their motor truck cargo agreement says. So here's the next, here's the next. Oh, I think Eileen popped that one for me. What document acts as a receipt from the carrier for goods being transported in the contract of carriage between the shipper and the carrier? So basically, this is for motor truck cargo. What document that are listed? Is it a bill of lading? Is it their insurable interest? Is it free on board? Is that destination or origination? Or is it the invoice cost? What document is the receipt? And we've talked about this. Oh, my gosh. Everybody is 100% on this one and we're over 50% voted. You guys are good. I appreciate that. Right now, it's 100% bill of lading. That's it. That's what you will outline between the carrier and his customer as to what the insurable interest is and what they're responsible for. You guys are awesome. Great job. So, you know, something we're getting to the next module and it's about 150. Why don't we take a 10 minute break? And let you guys get up and get some water and move your legs a little bit. I'm sure if you have smartwatches, they're telling you to get up and move right. So I think we take a break now. Absolutely, Diane, that's fine. All right, let's take a 10 minute break and come back here at 158. All right, it's been 10 minutes. So are we ready to start up again? I think we're all ready, Diane. Sounds good. Thank you so much. While we were on break, I had a question from Philip and he asked if there's a situation where the buyer is responsible for the goods while being transported. Are there different ways the buyer can get insurance to cover those goods? What type of policy would cover the buyer? So, trip transit is one way if it's one shipment for him to receive something in a larger commodity or quantity. That's one way the trip transit the buyer can get the insurance for it. If he's hiring the common or contract carrier to hire to haul the goods for him, he can hire the motor truck cargo carrier that has sufficient limits to cover the goods and name him as an additional insured under the policy. Most forms now, coverage forms, cover additional insured that they have insurable interest in the property that they're covered. Or let's say he's a manufacturer and he's buying parts to make his goods and he's responsible, it could be covered under his annual transit policy or his transportation policy. Because that basically covers his personal property or property of others in your care, custody and control used in your business and that are in transit by a carrier. So, there's different ways depending on what his responsibility is. But I would think the best thing is if he is making himself responsible for it, he needs to make sure that maybe he's the one arranging the transportation and being named as an additional insured under that carrier's policy. Because if he's buying something from someone he doesn't really know yet, there's a lot of ambiguity and he might, you know, he doesn't want to be left unprotected, especially if it's a bigger shipment. So, I'm not sure if that answers your question. But I would think that those are some ways that the buyer could get it taken care of. But as a buyer, you would also hope that he would push that on to whoever he's purchasing from the seller, that they would take responsibility until he got it. But again, if it's a big item, if it's a one or two shot deal, he can always get trip transit coverage through his package carrier. So, we're going to get into a little bit more on some more underwriting consideration. I just mentioned on under most motor truck cargo forms and transportation forms, if there's insurable interest, there's going to be coverage under different forms. But whose interests are you trying to protect? What coverage do they really need? Is it their goods being shipped to their customers, which would be transportation? Or are they the motor carrier? Do they need motor truck cargo because they're hauling goods for others? What kind of commodities being shipped? We talked about commodity hazards, and what companies look for, we're going to get into it on the next slide a little bit further. But know what's being shipped and how it's being shipped. How much are they shipping annually? Are they a lot of times the premium is based on from a motor truck cargo carrier, it's based upon how much they're shipping annually. Same with your sales with respects to shipping your own goods under an annual transit policy. What's the value? What's the maximum you're going to have any one time on any one truck? And do you have limits under your policy to protect you for those limits? So what's the average? What's your maximum? Is there any contract that's been signed that you've accepted responsibility for something maybe you didn't want to accept? Look at your shipping agreement or your bill of lading that's going to tell you what you're responsible for. Where's it starting? Where's it ending? We'll get into in the third section of this, which is with respects to kind of safety management and claims. Is it coming from an area that's got a high incident of theft? Lost history is always important as an underwriter, no matter what you're looking at, but with especially with anything that's in transportation, you can look at a lost run and know, okay, here's where they're having issues. Here's maybe where they're not protecting their goods like they should, maybe they're not maintaining their trucks and they're having issues with fire loss or damage. So lost history at least three years for a motor truck cargo carrier is standard within industry. For a larger account, you're going to maybe want five years, you want to make sure you see any trends, you want to see if there's anything that's happening that you want to be aware of. It's basically your standard underwriting, but there's more to it with respects to the commodities that they're hauling. We're going to get into, it's not really a chat question, we're going to get into next, the types of goods being shipped. It's interesting that pre-COVID, here's where everyone thinks, and it still is, these are where your big exposures are. Electronics, are they doing phones? Are they doing computers? Are they doing TVs? Is there hardware, software? Jewelry is always an issue. Cosmetics, footwear, think of your Nikes and your Adidas and your name brand shoewear, those are expensive, they're easy to steal and sell once they get them. Cigarettes and tobacco have always been a problem, same as pharmaceuticals. I always thought it was interesting as an underwriter, never understood like years ago, a lot of companies are okay with beer, beer, wine and ale, but they don't like the liquor exposure, which I'm thinking what difference does it make? Here's a perfect example. I don't know if any of you saw this article in the news a few weeks ago, but Guy Fieri and the Van Halen guy at Sammy Hagar have a line of tequila. They had two trucks that were stolen of this tequila in Texas. And it was $4 million worth of product in these two trucks that were stolen. They're never going to find them probably went into Mexico and it's gone, right? Because it's over the border, they took it. So when you see beer, wine and ales, okay, this that's why because you have a truck full of beer, it's not going to be as much as you know, $2 million cargo container of high end tequila. Those are tequila for the season. So it's going to hurt the company hauling it for them. I feel bad I feel bad for them is as the manufacturers but that's why liquor is is the liability that as anyone else haven't there's someone that said they're having problems hearing me. I don't I'm not sure. Eileen, can you hear me? Diane, I think it's fine. So anybody having trouble? We'll chat to them and tell them to just dial in. Oh, good. Thank you. Oh, thank you, everybody. Julie was the one who was having problems hearing me. So maybe that's you can you can touch her. Thanks, everybody for responding. Meats an issue just because you can steal a container of meat that's going to go and then precious metals it can be fenced. I mean, look at people stealing catalytic catalytic converters out of cars. If you have any kind of precious metals or stones or, or, or that like, it's pretty easy to get rid of that. So those are the commodities that that have tended to be historically the ones you can that we're concerned about, and that we're still concerned about but COVID who would have thought that toilet paper would have been something that we had to be concerned about or paper towels, or even um, food, food products. You never really worried about it as much as we did when people couldn't get those products or things were short on the shelf. So traditionally, these are the ones that have always been an issue and will continue to be an issue. But as we move along and, and things change, there's other commodities that come in handy. But I really think that liquor one was really interesting, because it really cemented the fact at least with me, okay, now I truly get why that could truly be an exposure. Is your insured the trucker is he operating as a carrier or is it a shipper? He's, he's selling his product, and he's delivering his products to other people. Why does it matter? Because it's going to matter with respects to the valuation. If he's, let's say he's a distributor, and he's shipping his goods through a common carrier, he's going to have, he's going to have, sorry, I got a little distracted. I want to make sure everybody's okay. I'm looking at the questions. If he's a shipper, and he's shipping goods to others, and he hires a like a trucking company to to deliver it for him, he's going to make sure that they have the proper limits, and he's added as an additional insured. So basically, it's contingent if something happens with that trucking company's insurance, while his stuff is being transported, at least he knows he's got coverage underneath this, you know, transit, transit or transportation policy. Is he getting a better deal? Because he's agreeing to lesser valuation? Is it replacement costs? Is it cost to reproduce? Is it the actual cash value? So there's depreciation involved? Is there a different release bills elating? How is that done? Is it full value? Is it going to cost me more to ship it if it's full values? And as an underwriter, you're going to look at those items to see what the responsibility is for your you're insured, whether it be the shipper, or like the seller or the manufacturer or as a motor truck cargo company, what are you responsible for? And your receipts might be different. Because if he if he does like ACV, or if it's invoice value, and it's not, he's not charging as much to haul because of what the bill of lading says, your receipts aren't going to be as high. So you want to make sure you know you're responsible for and see a copy of it. It's always good to get a copy as to what their bill lading and their shipping agreement says, even with respects to a distributor. What are you? What are you hiring? And who are you hiring? And how are you hiring these people? What are they responsible for? Refrigeration breakdown, anything that has to be temperature controlled. Think of also I read an article recently where they were delivering chocolates, like you don't see chocolates delivered in the summer. And if you ever notice, like from Halloween through, like, up to spring, you can get chocolate all you want. But in the summer, it tends to be things that aren't going to melt. So you have exposure with seafood, meats, vegetables, pharmaceuticals, then you have to be temperature controlled whether or not they're frozen or if they're or if they're just refrigerated. So breakdown is generally excluded on most companies forms but can be added back in when underwritten. So you're going to get asked questions as to who maintains the refrigeration units? Do they internally do that externally? Do they have sensors in the back of the trucks to let you know, hey, the temperature is going down in the back? Are there are there alarms that go off that you know that is being done? Do they make sure that they have procedures as to are the doors secured or locked in and making sure that it keeps the goods, the goods cold or frozen as they're being transported. So you can definitely have breakdown, but you're going to get asked more questions. And there's companies that will put a higher deductible on a refrigeration breakdown claims as opposed to the standard deductible that might be for for non-refrigerated. It just depends on what company you're looking at and and basically what they're hauling. Oversize overweight. We've all seen it. This is a good picture showing them going under a bridge that's too short and they're too high. And they hit the bridge or the overpass. We just had one here in the Chicago suburbs in the last six months, where adding insult to injury, the semi went underneath the bridge that was too short. And it took off the top of the truck kind of peeled it off almost like opening a can, and it peeled it off. And I don't even know what the commodity was. But all of a sudden, there was people from the area that came and sold everything out of that truck, they just came and grabbed and ran. So not only did they damage the truck, they lost the whole load because it pretty much all got stolen on the site. It was crazy. They had pictures of the people just stealing and running. It was crazy. So you want to make sure if it's oversized or overweight that they have either cars in front, especially for an oversized load that make sure that that oversized load can get under the bridges that the bridges aren't too short if they are that they can go around the bridge. Loading and unloading is an issue. Because they if they roll it off the wrong side, and it flips over that big piece of equipment, or that big shipment might be of high value, and you're going to lose a lot of money by damaging as it goes. Because of the high center of gravity, if they take a turn too fast, you're going to flip that load. Overweight, heavy is not always a big piece of equipment, it could be in a container where it's heavy on the inside, if it's not balanced correctly. We have a an exit here, not too far from where I live in the western suburbs of Chicago. And I want to say at least twice a week, there's an overturned vehicle at this one intersection, and this one cloverleaf where they're getting off and if they flip, they take it too fast, and they flip the side. I don't know why it happens at that location. I don't know if that's more of a central area. But that's a definite issue if they are delivering something and they don't have a balance down right on the inside, and they're driving too fast for conditions. So we've all seen these accidents, we all hear about this happening, especially when there's, it's rush hour, and you live in any big city or even smaller cities, and you know that that something's happened. A lot of times, it's just people going too fast or just not underwriting the hazards. But when you have oversize overweight, you're going to definitely want to play with your deductibles and make sure that they have controls in place, you're going to know by looking at lost runs, because we always say the last ones are so important. You want to see if there's any trends, hey, we know that they're hauling oversize overweight. What is it? What is history look like? If the history is good, then you definitely are going to know that they have controls in place, things are going to happen, there's going to be accidents. We all know how many trucks are on on the road right now, we see them every day. And especially now with people ordering online, there's more and more exposure. Are they going routes to avoid the bridges that might be too short? Do they have the proper permits to go through a town to get these items delivered? It's interesting when they do some of these really big moves. And it's a specialized carrier, a specialized company that's hauling it, where they have to, they move really slow. And it's almost like it's a parade, people stop and watch them move these big items from spot to spot. But that could be special permits going through different cities to make sure that that they can get around wires and they can get around bridges and trees and what they need to do. We talked about the oversize overweight is our car in front that might have like a sensor that makes sure that they can get under a bridge. Do they have a trail car to make sure that people aren't cutting off these tractors and trailers, and then causing them to lose control of these big weights? Because obviously, the heavier it is, the harder it is, the longer it takes to slap stop. Do they have the trailers or the capability? And do they have the have they done in the past? Do they have to? Do they have a track record of shipping these items? Do they have the proper way to load and unload them? The proper ramps that can hold that can hold the weight of a big piece of item rolling off the truck? Do they need to get some sort of crane to help them lift it off? Do they have? Do they have what they need to do it? These are some of the hazards that you're going to be looking at. And as an underwriter, you're going to ask your agent and your other company, whoever you're dealing with, you're going to ask these questions, because you're going to want to know that they can handle what they're hauling. You know, you always hate to see as an underwriter, let's say they have a limit of $100,000. And they normally haul general commodities. So canned goods, they haul, you know, some non hazardous widgets, you know, little manufacturer parts or, or different things that are non-target commodity. And then all of a sudden, they're asking to increase their limit to a million dollars, because now they're going to haul a heavy piece of equipment, there's going to be red flags flying everywhere from the underwriter that's looking at it saying, Hey, listen, they normally don't do this, how are they going to do it? What experience do they have hauling something like that? A million dollars from $100,000 is huge. How, where's it going? Where's it going to and from? You might get a declination from the person you're dealing with saying, Hey, listen, I don't think I don't feel comfortable that they have the expertise and the controls in place to do a haul like that. And maybe that's why sometimes you get the trip transit requests. Because you want to make sure that whoever's hauling that larger valued item or something that's outside the norm can handle what they're hauling. So that's why you get those questions. As a transportation carrier, do you have mixed loads? So less than truckload? So do you have more than one item in there? Is it a full load? Is it a partial load? Again, we talked about average and maximum on the vehicles and the values that are terminal. Do they need terminal coverage? And we'll get into cope and all that other information that you might need when you are looking at a terminal location. How has it been protected? What's the kind of security that's out there? So these are just some of the considerations that you're looking at. Tandem trailers. I don't know if anybody's traveled out west or is from the west, and you're out like in Iowa and South Dakota, and into Nebraska, and there's a lot of open highway, and you can go 85 miles an hour, or 80 miles an hour, and it's crazy. And you see two and three, and the most I've ever seen is three, where there's three trailers, tandem attached to one tractor. So one power unit has three different trailers on the back, always makes me really nervous, hate to pass them or just want to get pass them down the road. But do they do tandems? And if they do, you want to know that because you have a more, you have more of a liability with respect to a carrier that's got that's doing tandem, tandem shipments, refrigeration breakdown, we mentioned, again, you can, you can add it to your policy, if it's underwritten, most companies will cover it. To some extent, it might be a sublimit might be a higher deductible, but it can be added to a policy, but your rates going to go up depending on what your exposure is to breakdown. How are the goods stored? Are they stored in a terminal overnight? Are they delivered at, at, you know, within a certain timeframe? How long is it? Is it long haulers or short haul? What are your limits? Your per conveyance is usually one truck, your occurrence is generally two trucks, or maybe three, if you know, you have more than one truck at a terminal. So your limits are going to normally traditionally, you're going to see a per conveyance limit, and your occurrence is going to be double that. So if it's 100, it's gonna be 200, it's 250, it's gonna be 500. And then do they really need terminal coverage, if it's just being delivered locally, or within a couple hundred miles, and it goes from point A to point B in a day, you're not going to need terminal coverage. If it's going cross country, you might need it at a terminal. And we're going to ask more underwriting questions, which we'll get into. This is Eileen's favorite saying with respects to cargo, cargo at rest is cargo at risk. So the longer a truck is sitting idle, or parked, the more opportunity there is for theft, rest stops, delivery locations, if it breaks down, if it's at a terminal location, that's not being protected. Cargo at risk, the longer, longer waits, the more opportunity again to loss. I think it's interesting now, and this has just happened since COVID, where you drive and it's not even just rust areas. You'll see trucks parked up on and off ramps onto the expressways because they have nowhere else to park. They might not have a place within the rust area to park. Plus they park truck to truck to truck. And I honestly think that the ones on the ramp, even though you have a chance to get hit maybe by another car coming off the ramp, but it's hard to steal stuff out of the back of a truck when you're parked on the expressway like that and you're under the spotlights. And I just think it's really interesting. We've all noticed it. If you haven't, now that I've said it, you'll notice it. I mean, I really just was seeing it. I do a lot of travel within the Midwest driving, and I was just seeing it rust areas. And now again, it's on and off ramps too. Usually not in urban areas. It's more out in the sticks where there's not a lot of places to stop. If they're stopped, what's their propensity to cat issues? Fire, it could be wildfires. It could be fire alone. Let's say you don't maintain your trucks and their brakes catch on fire, which in turn catches the truck on fire. Had a really interesting loss years ago where they were transporting goods long haul. They were moving an office from point A to point B. And part of the move was a company car in the back of this semi. And the driver was driving and there was equipment and goods and computers, and then this car in the back of this truck. And the driver felt like something was going on and something felt lucid. He thought he heard noises. So he stopped the truck. He opened the back of the truck on the side of the highway and is looking at it. While he's looking at it, he's smoking a cigarette. It's really a windy day. Doesn't think anything of it. Closes it up, keeps going. Next thing you know, the back of the truck's on fire because the embers from his cigarette caught the back of the truck on fire and destroyed the whole load. So it's not just fire from outside sources. It could be people not making educated decisions when they're checking on. I mean, he did a good job by stopping the checking to make sure that things were being shifted, but you don't smoke when it's windy and you open the back of a truck that could cause a problem. But is it in an area that there's been a lot of rain and there's floods coming? We pretty much know if there's a bad storm coming, they tell you that, okay, there's flood risks and there's issues. Do they have plans in place to make sure that can move these goods out of harm's way? In terminals, if you're parking your truck at a terminal and they're unloading and reconfiguring and sending stuff out by different ways at a terminal, is that terminal protected? Do they keep it parked overnight? Is it locked and secure? Do they have security? You don't want to have your stuff go to a lot that's not protected. I always think about when you come to like, let's say you have a storage location and this is just as a consumer, you see these used store places. I always see the ones that don't have fences and wonder why are you putting your goods that you just have a padlock on it at a risk that's not well lit and doesn't have a fence around it and there's not controlled entry. Same thing with the terminal. You wanna make sure that you're insured that if he needs terminal coverage and it's being parked anywhere that he's at a site that's protected so that his goods are safe. So again, if it's sitting there, you wanna make sure that it's being protected because the longer it's on the road, the more likely you will have a loss, which is exactly what this says. If you have a lot of overnight stays, you wanna know if they're secured or unsecured location. Driver fatigue is huge. I mean, we always used to worry about and even now impaired driving, not so much even from liquor or other modes of making you tired, but are you driving too long? Is your driver tired? Is the only driving them a set amount of hours and then you make him take that time off to get some sleep and to make sure that he's awake and ready to go. Are you in a high theft area? Any major city, Illinois, Chicago is one of them. You've got LA, you've got Miami, you've got the East Coast. East Coast that has any kind of shipping terminal. If you're in an area that's high theft, you have to worry about what commodity is being hauled and where's it going. We talked about losses. Again, it's important. You're gonna see any kind of trends. Are they happening because the maintenance isn't there? Are they happening because they put it at terminals that weren't protected? Are they having the same kind of losses? Have they done anything to prevent further losses? I mean, technology's come so far as we all know in the last so many years that you can buy those GPS sensors, even the tags that you can put on those tiles, you can put on your luggage when you travel, those can go on the back of the trucks. They even have the little tags that you can put into boxes within the load so that if something gets stolen, you know where it's going. Are they preventable? Have they put lockout tag out? Do they put locks on the back of the trucks to stop them from stealing the cargo out of the back of the truck? It's interesting now because you see more and more of the tractor trailers that have the cloth on the back. Instead of having the steel or the metal to protect it, it's got the, it's canvas. I always worry about those on a long haul because it's easy to cut through those and steal if you can, you know, steal the load inside through the side. They got really good at taking things from metal trucks and trailers, trailers on the back of the trucks. Now you've got the canvas ones. Generally the canvas ones though are more agricultural or non, they're not commodities that are high valued. So you don't have to worry about them as much. And normally they're not long haul. They might just be, you know, local, local to intermediate, so under 200, 300 miles. So they can be delivered in one day. So you don't, they're not at rest. So they're not at risk. So you just have to look at the haul loss history. Maybe if it's something that you're seeing an issue, can you solve it by a higher deductible? Can you solve it by having them deal with some sort of safety management or loss control that can go out and help them with the type of losses? If you see a frequency and then you see it's been fixed, it shows that they're putting the investment into where they need to put the investment. Packing considerations are important. Are you, is your stuff pre-packed? Like it's a protected in boxes with styrofoam, is it done? Is it fragile? Does it need special handling? Do they have to have special packers that are experienced in packing things that might be breakable? Do they have the proper tie downs within the unit to make sure that things don't flip over? I don't know if anybody's watched any of those programs where they go on whiteboards and then they bid to haul items. Those are kind of scary because they could be doing things they're not responsible for. Excuse me, I remember one where they had a gentleman and he had a statue and he was hauling it from point A to point B and it had to be there by a certain time. And he really didn't know what he was doing. So he ended up putting the statue backwards where the base was at the end of the truck and it took him twice as long to deliver because there was a drag on the trailer and it took him longer to get there. If he would have flipped it the other way and had the base at the front of the truck, he wouldn't have had any problems. So you want to make sure that your packing and your loading procedures are good enough that they're going to make it easier for them to deliver it in one piece basically. Do they have the tags inside? Do they have seals on the trailer depending on the commodity? Do they shrink wrap the loads to make sure they don't shift and they can't be broken into? You have something that's shrink wrapped really strongly, it's really hard to break through that shrink wrap to take some stuff out of a few boxes. Whereas if it's just a box with tape on it, it's easier just to go on, hey, this is coming from someone that might have TVs or phones or whatever as part of the commodity and they can just like take a box or rip through a box and take what they need. So the packaging is good too. And you also don't want to advertise, hey, here's a big box of phones with lights on it so they know that it's a target commodity. So that's just something that the insurer can consider with respects to packaging his goods. And then when he hires a trucking company, if he needs to haul his goods, that they know what they're doing and they know how to protect it. Driver selection, you're going to get that information through the CAB or through a Central Analysis Bureau, which we'll talk about in a little while. But how old are they? Do they run MBRs? Do they have driver training? What are their background checks like? Do they have training if they're sending them on a route that they're not used to? What's their background with respects to their prior experience? Obviously someone just getting out of truck driving school is going to be different than someone that's been doing it for a lot of years. So do they have written formal hiring practices in line? It's kind of the same thing that you're going to look at with respects to writing the auto on transportation accounts. You're going to want to know this information with respects to the drivers, with respects to the commodities also. So if you're looking at the whole account, it's kind of all going to go hand in hand and it makes sense because you want to make sure that they have experience. And if they're newer, what kind of training do they take them through to get them further along as to what they need to know? Their equipment. What kind of maintenance do they have? Do they have pre and post inspections? Hey, the truck goes out in the morning and we look at it when it comes back empty, we make sure everything's in place. Who does the maintenance? Who's responsible for it? If it's a refrigeration company with their reefer units, are they licensed and qualified? Do they maintain them at their locations or do they always use outside sources? Their financials are going to help to know that they can afford to maintain their trucks and pay their drivers and not skimp on the routes and make sure that they're hauling items that they know that they can haul along the way. So you don't want them because, oh my gosh, we're in financially, we just need to grow this and let's just start hauling oversize overweight because we can make more money doing it, but they really don't have the equipment or the manpower to do it or the experience to do it. So you want to make sure that they maintain what they have and that their financials look good and they have the drivers that can do what they can do. Technology is wonderful now, right? What did we do all before GPS and routing? I mean, any of us that travel any kind of distance and you put your maps on or your GPS on or whatever you're using, it will tell you, hey, listen, there's an accident. This will save you half an hour. This is, there's an issue here, let's go there. And the GPS can also be used to monitor the speed. They might put speed controls or they know that the drivers are going too fast or not. It'll tell you what fuel stops are. Most, everyone has a cell phone now, even if it's just for emergencies, but you can use your cell phone for a lot of things. It can, if you have sensors in the back of your truck, your cell phone's going to be what pings to tell you that, hey, there's something going on that you need to know about. Can they track it? Do they put tags in boxes if it's a high value commodity that they can trace it if they need to? Do they have engine cutoff if there's an issue and someone steals their truck and they stop that truck for money? The engine cutoff remotely. Dash cams, there's so many issues now with people causing accidents on purpose. Dash cams, you see everywhere now. It's great to have those in a truck and they're not that expensive anymore. So if you know that they're spending money on the technology to protect the loads, you know that they're doing the jobs that they need to do. Terminals, we had mentioned briefly earlier. So if you do have commodities or you have a trucking company and their trucks are stopping at terminals for any length of time, you're going to want to underwrite it. Just like your basic property, you can look at your cope, your construction, your occupancy protection and exposure. What do you, where are they going? What kind of protection do they have? Is it 24 seven security? Do they have the fence lighted, gated? Do they have security wire around it? Are they open 24 seven? If they close, what are their practices for protecting those trucks that are backed up to the terminals? Do they back the trucks up to where they're loaded and park it so that no one can get into the back of that truck from just sitting in the lot? The temperature controls with respect to those terminals. If it's required to be at a certain temperature and it leaves your truck and it is, is it getting into the building, into an area that's being protected from that temperature? If it's at the right, is it at the right temperature? And is that being taken care of? And then when they detach a trailer from the power unit and they park it in a terminal location again, and it's fully loaded, how are they protecting? And again, backing it up to the doors, making sure that they have people walk the lots, make sure that they have fenced, secured, lighted, hammered locations. So if you have a lot of exposure at a terminal, you're going to want to know what the responsibility is and what they're using and where they're going. Your terms and conditions, I mentioned this before, I've worked for a lot of different companies over my careers, and there's not a day that goes by that I don't check my coverage form, not just for transportation, motor truck, cargo and trip transit, but for every kind of coverage that I write and I underwrite. So know the coverage form. Not everybody's forms are the same, which you all know, and anybody that's an agent or even an underwriter working for different companies you've worked for, you know, we all kind of borrow from each other throughout the industry, what works and what doesn't work, but each coverage form is different. You want to know, does your policy cover loading and unloading, or it doesn't? Do they need it? Can we add it back into it? What does, you know, what's your responsibility? What does your bill of lading look like? What is your, how does that tie into your policy? These are things that you definitely want to take a look at when you're looking at your policy terms and conditions. Don't, usually for motor truck, cargo and transportation, you don't schedule vehicles. That's more for auto physical damage. Generally, you have a limit per vehicle, but you don't schedule those vehicles on the policy. You know, from underwriting that there's, you know, 50 power units and 70 trailers, or there's 10 and five. Usually it's coverage, it's a per occurrence limit. It's not a scheduled vehicle limit. There are scheduled vehicle limits out there, but it's very few and far between. I've only seen it a handful of times over my career, and I personally have never done it, but I'm not sure what the benefit would be from a transportation part. I could see it obviously from an auto physical damage standpoint. I do know that there's forms that you might have like a smaller fleet. So you have a small operation and it's rated per truck, but you don't schedule those vehicles. You know that there's three power units. So the premium is based on three, not tied to a specific truck. So normally it's kind of blanket. It just gives you a limit overall, but are those limits adequate? Like we talked about asking about minimums and maximums. Let's say they ask for a hundred thousand limit and you find out they're transferring $250,000, you know, you're not going to have, it's not going to be sufficient to cover it. So these are the questions you want to ask, especially bigger cargo accounts. These are things that you're going to look at the terms and conditions. You know, can you increase it? Can you amend the coverage form? The good thing about any kind of inland marine coverage, most states it's not filed. So if you need to be flexible, your company can generally be flexible. If they can understand what the exposure is, they might be able to modify a form to accommodate one of your insureds for maybe one type of commodity that they're hauling, maybe put a sublimate to protect just that one that might be different from the full form. So just know that you can add a modified coverage. You just work with your company and your underwriter and see what works best for your insured and see what makes sense. So other things to consider, again, we talked about deductibles, your hauling, your limitation, your theft limitation. So your lockout, tagout, your GPS, your sensors, your blankets, where they're going. Again, the longer they're on the road, the more opportunity you have for a risk, not just from theft and from damage, just from general driving. I know that here just east of me in Northern Indiana, Southern Michigan, they had whiteout conditions and there was an accident. There were 40 vehicle accident that happened and there were a lot of trucks involved. So they're going along their own way and they're in snow, lake effect snow. So it's clear and all of a sudden you can't see. And they had a huge accident. So the territory they're going in, do you have to worry about like wildfires out west? Do you have to worry about, is a storm coming from a hurricane and are they supposed to be delivering in that area? Do you change the course of where they're going to somewhere else to protect that load? So those are some of the other underwriting considerations that you would look at from a risk. Your premiums pretty much based on, it just all depends. It can be based on a per power unit basis, which I mentioned with respects to a motor truck cargo, if it's a small enough fleet and your company you're dealing with has that option. Most of the time it's based on amount shipped annually. So your transportation, your annual transit for your distributor and your manufacturer, it's going to be based on the amount shipped annually. So a lot of times, especially for a distributor or a manufacturer, it's your sales because everything has to go out, right? They have to ship it somewhere. And you're going to get, you're going to have to pay for what it costs them to ship it. You could do different reporting forms. I haven't done a reporting form on a cargo policy a long time, but it can be done on larger risks where your exposures might fluctuate and they want to break it up and they want to do some sort of reporting form. It can be done that way. When goods, the value of goods went up exponentially during COVID and it costs more to ship. And even now everything costs more. Do you base it upon the revenue or is that inflated? So do you want to base it on mileage? So they drive so many miles, you change it from a receipts based on the mileage. From a receipts basis to a mileage basis, it can be done that way. Again, we talked about vehicles. If it's small enough, you base it on, not on the trailers, but the amount of power units that you're hauling. So we're going to get into exposures with severity. So you've got scheduled vehicle limits versus non-scheduled. Again, we talked about that. A lot of times you don't see a scheduled vehicle for transportation. You just see a per occurrence limit. So most policies, you get the number of vehicles you have and the limit that you need for the cargo that's being hauled. So you're going to generally see something along the lines of X for any one-owned vehicle, X for any one carrier that could be a common or contract carrier. Some companies don't do aircraft or rail car, but you might get a small sublimit, maybe $10,000 for aircraft or for a rail car, just so that it's not silent and there's no ambiguity to it so you know exactly what you have. And then when it comes to the per occurrence, which it doesn't mention on the bottom, whatever your one or any one vehicle or any one carrier, it's normally double that. So if it's 100,000, you're going to see any occurrence of 200,000 to accommodate more than one vehicle at any one time. If there's concentration of values and you know that you have four or five trucks at any one terminal at any one time, you might increase that 200,000 to 500,000 depending on what you need. Are they stopping at warehouses? Are they consolidated? Do they have consolidation locations? So they take a big load of something and then they break that load down and they distribute it into other trucks. How long is it done? Where is it done? Is it done always at the same location? Do they own these terminals? If they own the terminals, there's a lot of times you can have coverage under your package policy, obviously, for the terminal itself. But you're going to want, excuse me, you're going to want coverage if you're a carrier going to that owned terminal, you're going to want to make sure that that load is being protected at the terminal. Is there sufficient coverage for the goods being stored at that terminal location and what's the proper limit? So again, we talked about pharmaceuticals and electronics. So it's just important to know that you understand insurance operation. There's a lot of companies, we all know, you know, Amazon now, Amazon hires workers. They have their own drivers and their own terminal locations. But then they hire dedicated, they hire dedicated companies that will haul for them. So you know that they can haul everything from jewelry to electronics to toilet paper to whatever. And people think that's a higher exposure because they might have electronics and liquor and stuff that might be a problem. But they fill that truck in the morning, they deliver the goods, and they're all delivered within the same day. The truck is empty at the end of the day. So you can underwrite to a minimal amount. Let's say the most of their value is goods, but 5% is X. Okay, how do they protect that 5%? And it doesn't make sense for a company to write. So you're definitely going to want to understand what they're hauling and how they're hauling it. We're going to get into financials really fast. So financials obviously are really important. You want to make sure that your motor truck cargo carrier or even your shipper who has his own trucks, that they have sufficient funds to pay for proper maintenance and proper training and proper hiring practices and management practices. Do they make sure that they screen their drivers? Do they have, you know, loss prevention? Do they have the GPS? Do they have the monitoring? Do they have controls in place so they don't drive too far over the speed limit? If they don't maintain their trucks, you can run into issues. And we'll talk about different hazards that happen. If you have a motor truck carrier and they don't have enough money to pay their premiums for their insurance, there's insurance lapse, and then they're responsible for something that they can't afford to pay. Is their deductible too high and they can't afford to do that? Financials play a really big role in what's happening. We talked about filings. Really, the only filing that needs to be done for a Form H nowadays tends to be household goods. And again, it's a specialized carrier. I can't remember the last time I did a Form H since they stopped, since it stopped being a requirement years ago. And most standard companies don't write household good carriers. You're not going to see requests to do filings. I don't really know a lot about Canadian filings. All I know is that most companies can deliver into Canada. They a lot of times cannot do a terminal location in Canada, but they can go into Canada. But you cannot go into Mexico. Mexico is a whole different animal. So you can go north and you can go in and come back out for a day. Like you deliver over the border and back, but you can't do the southern borders because of the rulings. So I don't generally see Canadian filings. We do have trucks that do go into Canada for companies I've worked for, but I've never been asked to do Canadian filings. So I think it's few and far between, but it's nice to know that if there's a filing requirement, there's resources out there to get that information as to how to get it done. Central Analysis Bureau, you're definitely going to, most companies look at this from a driver's standpoint, and we look at it for motor truck cargo also. It's going to tell you what their financial rating is. Satisfactory is good. Anything that's maybe borderline poor, unsatisfactory, dangerous, you're going to have a lot of your companies walk away from the insurance because you know that they don't have the financial means to support what they need. So you definitely have to look at it. Companies will look at a CAB report, and it's also going to tell you what kind of maintenance they have, are they being stopped, what are they being looked at, do they have what they need with respects to being able to continue their operation. You definitely want to make sure that their financials are solid. If they're not, you're going to have companies walk away from ones that don't have money to support their businesses. So with that, we're due for the next break. So let's take another 10-minute break, and we'll come back a little bit just right after 4.02 your time. Okay, Eileen, I'm back. Are we ready to go? We've been waiting for you, Diane. I'm just waiting for you. I'm only kidding. I'm only kidding. We are ready. Okay, awesome. We're going to continue almost on to the second presentation, so let's keep going. So basically, we've already talked about, okay, oh, there we go. I wasn't taking it for a minute there. Let me go back. Okay. So general policy provision. So basically, any of the forms you pick are going to differ by the type of policy, right? Your motor truck cargo is for your trucking companies hauling the goods of others. Your transportation insurance is going to be for your shippers and, like, distributors. Your retail operations, anybody that ships goods to customers. And then your trip transit will basically be one trip from a specified location, point A to point B, for a certain time period. The goods which you cover, what's being hauled, there has to be an insurable interest, whether it be from the bill of lading or if it's your own goods, it's your goods that you're hauling. Most policies will exclude your fine arts, your jewelry, your precious metals, live animals, that type of operation, as we discussed earlier. If an underwriter can wrap their head around a commodity, they're going to probably be able to find a way to cover it on something that normally you wouldn't be able to cover. I had a counterpart years ago that had a risk and it was a real estate operation. And once a year, they did a big charity event and they took jewelry and they transported this jewelry from point A to point B for a specified period of time, almost like a trip transit policy. And they were able to, under their transportation form, accommodate this specific event on the specific limit of the jewelry that they were selling for charity. So again, it's not always a no, it's going to be a cautious maybe, but your underwriter is going to look at what the exposures are and what controls are in place and what makes sense for them to do. Employee dishonesty, I'm going to touch on briefly. Most coverage forms exclude employee dishonesty because that's crime. Same thing with respects to any kind of transportation coverage. If the insurance employee was involved, there's a good chance that that's not going to be paid under your transportation risk, it's going to be excluded. Your coverage forms, it's going to be excluded because they're somewhere else that it can be paid. So it's always interesting to talk about that. I mean, theft is covered if it's from an outside source, but from an inside source, it would be crime. Your extensions, your policies are going to include some limit of debris removal. If you spill a load and they have to clean it up, there's going to be a limit for that or there's a truck and there's parts of the, well, not the truck because that's excluded under the form, but the boxes get knocked out of the truck or they have to clean up debris. It's going to be covered under a sublimate. Same with pollution cleanup. Usually it's a small sublimate and especially with their hauling stuff that's environmentally dangerous like oils or greases or gasoline, your pollution cleanup limits are going to be sublimated and you're probably not going to be able to get those increased very, very often. Can you add the earned freight? Do you have the reefer breakdown? Is there additional charge for this extension? Is it higher deductible? Your newly acquired equipment, it doesn't really matter with respect to your transportation because your forms don't cover the units themselves, but if you are basing the premium on a power unit basis and they do buy an additional truck or they acquired a terminal, you're going to have to underwrite it to it. What's the valuation? Is it, what's it based on? Is it based upon your normal replacement cost, ACV? What does your bill of lading say? It all is going to depend on what your agreement is between your customer, whether it be you're shipping it yourself or you're shipping it for your goods or if you're a carrier that's shipping for other people. So coverage territory, we kind of mentioned pretty much most forms read the same. It's United States, it's territories, Canada and Puerto Rico. Well, Puerto Rico, obviously you're not going to be able to get to, so it's just a standard wording that they throw them with the same with property. But going into Canada is okay. Going into Mexico is not. So it's a 48, usually it's the US, maybe through Canada and into Alaska, but that would be a really long haul to get up into Alaska and it's a different thing. You have to take their trucks a lot of times up the passageway on boats. So you don't see much Alaska, at least in our neck of the woods, like in the Midwest. But just know that that's the territory limits and pretty much everybody's, most companies' policies follow that wording. But obviously, it might not cover the terminal locations in Canada. It might just cover the goods that go over the border and get delivered. So basically, this next part is for further reading. If you want further information, here are some, you'll have this in the PowerPoint presentation that you all have access to. But if you want further reading, you can go to the imua.org. There's the FMCSA, so the Freight Motor Carrier Information. You can go under CAB to find out what that's all about, more reading on SAFER, which we talked about, ISO, if you're a member company, to ISO your company or who you're dealing with this. So here's some further references for you. I did have a question from Philip again, and it was with respect to CAB reports. Are they updated on an annual basis or can a company's CAB improve or worsen through the year in real time? Generally, I think CAB is annually because I don't think they have access to the financials. I think they base their information on their annual financial statements. So I don't tend to see CAB updated in real time because I don't think they have the capacity to do that, but I think that they do it based on an annual report. Obviously, it can worsen because if the report's bad, the updated report you get annually, then it's definitely could change what they have. So there's an answer to your question. So that's some information, and I'm not going to go through the case study. I'm going to just leave it out there for you guys to ponder if you want to, like, go over what we've talked about today and then kind of look at this. It just talks about a bigger transportation account and what some of their exposures are and how you would maybe look at it differently than maybe you would have beforehand. So that does it for the first session of this presentation, the first section of it. Does anybody have any other reports before we continue? I'm not seeing anything else. Oh, look at that. Look how fast you are. Yay. So. I'm trying to get a jump on it. Here we go. I know. Perfect. Thank you so much. Thank you. So I don't see any other questions, so I'm just going to keep moving forward. So we're going to talk a little bit about loss control or safety management, how whatever your company or what you're used to calling it in claims. Now, I'm not an expert in safety management or in claims, but I've read enough reports and I've seen, you know, enough claims so I can speak on a high-level basis. So let's dive into this. Okay. So we're going to start with a poll just to kind of keep you thinking before we kind of talk about the answers to this and. Oh, thank you. What is a leading cause of loss by frequency? So we're going to get into another question after this, but on a frequency basis, what do you think is a leading cause of loss if you look at all these, at the three different items? Oh, you guys are fast. I'm always impressed when everybody answers that fast on this. So what's leading the way on the poll answers is theft. So real list, in real time, and we're going to get into a chart on this, breakage is actually the leading cause of loss by frequency. So that happens more often and theft tends to be severity. So this is a, so I just answered your second question for you. The next polling question is, what is the leading cause of loss by severity? So frequency, it's breakage. And then I just answered the last one for you. So let me go here really fast and do, let's launch that really fast. What's the cause by severity? So I'm nice and I answered for you, even though that wasn't my intent. So I'm going to actually close this poll because I basically answered it for you. So we're going to get into a chart next. The chart is going to be afterwards and we'll address both those questions. So your hazards with respects to cargo loss, whether it be motor, truck, cargo, transportation is, you know, vehicle accidents, you roll over your collisions, your accidents. There's so many more cars on the road and trucks on the road that makes sense, right? You're handling, is it breakable and they're rough handling it? Do they drop it? Do they have the proper machines or helping items to get them to handle the goods that they're having, water damage? Are their trucks sealed? Are they in one of those canvas trailers and there's a hole in it? Spoilage, do they have the temperature controls in place? Are they hauling things that can be contaminated by other things that they're hauling? We talked about infestation. So is it a crop and there's bugs in it that gets into other items or they're, you know, something's contaminated and it goes into something else? Theft and pilferage, so is something outright stolen or does someone go through the boxes and take anything? Fraud, we're seeing more with fraud, right? Right now, it's easy to go online and get a bill of lading and say, hey, I'm picking up these goods. This is, you know, here's what I'm picking up and they release a load to the wrong person, it happens. Especially when there's, they're hauling off a driver board where people are independent and they go to pick something up and they get hoodwinked or they commit fraud where they find out that something's being picked up and they circumvent that load. So fraud is definitely something to be considered. Again, is it specialized? Is it heavy? Is it high value? Does it need to be refrigerated? What are your exposures? So in answer to the two questions that were just asked, so if you look at this chart, you see breakage totally eclipses any other frequency amount. It's 55% because if they mishandle it, if they're tired, if they get in an accident, if they roll the load, are the goods breakable? It's interesting, back in the day, years ago when I first started in the business, if you had a load and there was damage and only about one box was damaged and it's let's say a food, it's a food product. They could take the non-damaged boxes and they can sell them or try to get some money back on that load with respects to going to like dog food companies or great companies that could use that food somewhere else. Well, now the requirements have changed. And a lot of times, even if only one or two boxes is broken and it's a food product, the whole load has to be destroyed. So I think that's what's kind of skewing what the breakage is. It's not so much the breakage of the goods themselves, it's some things that cannot be reused for something else anymore. But then if you look at the severity, you see that theft is just beats out fire with respects to the amount of severity of loss. So theft is one and then fires two. You don't think fire so much as they go through a wildfire and it catches the unit on fire. It's more they're not maintaining their equipment and their brakes heat up and catch on fire and it catches the truck on fire and they're just not protecting their commodities. So I just think that's kind of interesting that, I mean, the percentage, the severity, even though 55% of the frequency is breakage, only, you know, 20,000 is their average amount of loss with respects to breakage. So I think that's kind of interesting. So over the road forces, you have to worry about, you know, the heavier the load, the longer it takes to stop a load. So you have to worry about their driving. Are they driving too fast overall? If they're driving too fast for conditions, are they, when they're going into a loading dock or they're hooking up their trailer, are they, do they have the controls in place to make sure that they don't have issues that they're, and then once they hook the truck to the trailer, the trailer to the power unit, is it secured properly? Are they taking corners too fast? Are they on rough road conditions? And what do they have within the trucks to protect that? Are there shocks and stuff in good condition where they're not over shaking what's inside the trailer? The road conditions, we, you know, I talked about the lake effect snow in southern Michigan, northern Indiana. That definitely makes a difference on what happens and what accidents happen. The check question, I think it changes daily. So it's something to think about, you know, what do you think the most accidents are caused by? I would think, I personally think that it's driving too fast for road conditions and it causes an accident. Even with respects to even tipping a load, they take the ramp too fast or they're driving fast and they can't stop or they're not paying attention and it happens. Aggressive driving, 42 percent for other conditions, failure to pay attention. Now with all the phones and you can watch TV as you're driving, are they distracted? Are they texting? Are they doing what they should be doing or not doing what they should be doing, which is leave your phone down and don't look at it? Is it somebody else? Do you have someone in your habits bothering you? Do you have a car that cuts you off and you can't stop? Is your load stable? Do you have it tied down the right way and it's not going to shift when you're driving? Those are all the things that cause accidents that a transportation company would have to consider. Your maintenance or your equipment is going to definitely impact your accident prevention, your screening, your training with your drivers. A lot of the stuff we talked about in the first segment on this is stuff that's going to, it goes hand in hand with loss prevention, loss control. The territory, are you driving in the areas that are high hazard? Is your equipment updated? Is it well-maintained? Do you have security training? So if you've got a load, you're long haul and your cargo at rest is cargo at risk, are you protecting that load? Do you have lockout tag out where you know that someone's tried to get in the back of your truck? Are you parking it where someone can't get to it? Are you sending it in a terminal? These are things to prevent not only accidents, but losses overall. You know, rough handling, this is a really good example of someone that doesn't have the proper equipment to get something off the truck. And that's why you want them to have the experiences, you know, here they are. They think that this small little lift on the back of the truck could accommodate this big piece of equipment and obviously couldn't because it fell off the back and it's now damaged. So do they have the equipment that can handle it? This is something we've looked at earlier, but, you know, and even with respects to this, it's not even in a box or in a crate. It's just, you know, they've taken it out probably for ease of getting it out of the truck and then they can't handle it getting out and it falls. So you just want to make sure that your insured is whether it be the seller or the, you know, so it's transit or whether it's motor truck cargo that they they're putting the proper controls in place and they have the right people and equipment to do what they need to do without causing damage like this. So it's interesting, package testing, I've heard about for years, I have never really experienced it. Like I haven't ever asked the question they asked you, hey, what kind of package packages do you use and what kind of testing do you use on those packages? So I just think that that's interesting. But I know that companies that load that pack for people definitely make sure that they're using the right or they should be using the right materials to protect whatever they're packing for the items that are being shipped. Marks, how are the boxes marked? You know, again, you don't want them to have these are phones on the outside of the box so that it's a high potential. Do they have the proper shock and shock absorbers and they have indicators showing that the load might have shifted in the back? Again, GPS can do so much for us now. It can tell us if they're driving too fast. It can tell us if the load's unbalanced. It could tell us if the temperatures have changed. Do they have the proper equipment to get the cargo in and out of the trucks that they're transporting their items in? And the training, how are they training their employees to be able to load and unload or be able to secure the loads in the back of the trucks that they need to? And here, we're going to talk more a little bit about the securing. So are they distributing the weight the right way? The example I gave earlier with the statute was backwards, and so it caused a drag on them delivering it and took them twice as long to get there because they couldn't get to a speed they needed to because they didn't. They didn't brace it right, they didn't put it on right, they didn't distribute it right. So these are the things you want to make sure that they're they're making sure that the loads in good shape when they start, they want to make sure that they plan for what they have and distribute the weight accordingly. Don't leave a lot of void so that stuff can shift when they're when they're moving, that they block the wheels while they're loading it so the trucks doesn't shift as they're getting goods in and out of the back of the truck. So this kind of gives you some other resources to look at to understand more about securing the cargo on the back of the trucks. Water damage, it can be while it's in transit or in storage, it could be from rain or flood, or even storms with winds. You know, there's windstorm everywhere. Nowadays, you know, you never know, we're going to get into wind hail issues. So you can get hail that causes damage to the back of the trailer that could, again, cause rain or water damage into your goods that you're hauling. They talk about going from hot, humid to cold, you know, you get condensation built out. I know that it's been really cold where I live and I cooked over the weekend and my windows were all steamed up on the inside of the house because it was so cold outside and and you have to worry about that. So when they transport something from a hot, humid area to a cold area, what kind of temperature controls might they have in place to prevent any kind of mold or mildew from happening from transport? And do they have wet packing materials? Did it get wet or is it wet and it's drying? You know, you have wood that's unseasoned, so it's green, so it kind of seeps anyway and it kind of emits moisture as it's drying. Is that going to be put into a truck or a back of a trailer that might cause damage to other products they might be hauling along with it? So solutions to keep from having water damage is the way they pack it, it's how they store it, it's the temperature they store it at, it's how they how they move it along the line. Do they do they put it with in the front of the truck to have easy access so they can get things that might be temperature sensitive or have damage costs? Can you can you distribute the load and and keep that water damage from getting on other items? So those are things to look at from a safety management standpoint. And when you have someone that goes out, they should be able to to look at that for you and make sure that they have proper. It's all about really bottom line. It's all about having proper, proper controls in place, right? It's all about maintaining your equipment and making sure your packing is good and making sure your people are are. What do they call people that are there are they're trained and they have experience and they they know what they do because human error, I mean, a lot of times your equipment breakdown coverage, they try to say there's a loss because the. The equipment failed, but a lot of times it's human error, they didn't set the temperature at the right amount and they get there and it's off by six degrees and it's ruined the load. That's why the temperature sensors in the back being a cheap product now, it helps it helps prevent the human error that that might have been there before. There's so many things that can be done on a on a basis where where our insurers can be protected and do the right things. So knowing what if you're doing something that's temperature sensitive, know what what the parameters are, where where that. For lack of better way to say it, what are the guardrails and temperature so that you make sure that you stay in that that middle that that the parameters so that you don't ruin a load by. Not maintaining your equipment and not keeping it at the right. Temperature is a recorder again, the GPS is really good at keeping track of it'll keep real time track as to what the temperatures in that truck at any one time. So that helps. Do they have special storage and transit and handling instructions? Is this breakable and they have to be careful with X about what they're moving? Don't drop this box, have this box, you know, face up. You can't put it on its side or on its back or it's going to ruin whatever's on the inside. It might be unbalanced. And as you're routing, are you taking routes that are easily easy to get through and they're not in high hazard areas and you have to worry about hitting bridges and making sure that you're following your own set of procedures for more written procedures on any of this are always a good thing, especially with a trucking company and how obviously how everything's mobile in nature. So it's making sure that you have controls in place and that you're protecting the loads that you're handling, that you're studying, you know, theft. Again, it could be at the premises where it's being stored at. It could be in transit if they're not protecting their loads and they're parking overnight. You could pick a carrier. Let's say you're a distribution company and you hire someone to haul some stuff for you and they don't have controls in place. You have to worry or you get an insurance policy written for one of your insurers and it doesn't have the coverages you need. Let's say you know that they're transporting refrigerated goods, but there's no refrigeration breakdown endorsement on your policy. You want to make sure that your policy gives them the controls, gives them the coverages they need to protect them from theft or even any kind of damage with respects to shipping their goods. So we've talked about goods in the first section, attractive goods. These are all ones we've kind of talked about. It's interesting because they have wine and spirits. Again, beer, wine and ale is pretty much good for everybody. It's the hard liquor, the liquors, the expensive liquors that are more of a problem. Auto parts, tires are always an issue for even a property standpoint, because if a tire is in the back of a truck and catches on fire, they're pretty much going to let it burn out. Appliances aren't as scary just because they're big and they're hard to unload and take out and take care of. I mean, they can sell them once they get out, but it's hard to move. You have a truck full of refrigerators. It's going to be kind of hard to get that out and not get caught. Right. So it just all depends on what your standard ones are, the ones we discussed earlier. And then you've added a few in here with respects to even building supplies. Building supplies, the cost of even plywood had gone up high during COVID because of lack of ability to get the product. But that's kind of balanced out and gone back down again. So it's whatever you've got an insured or a thief comes in and they think they can take easily and get rid of easily. I think I think appliances is pushing it. So here are some target rich theft areas, and you see a lot of them have ports. You know, you've got California, Florida, Texas, New Jersey, Illinois. You have issues there. You've got areas within the West and Midwest and the South that that they have a lot of terminal locations and they're they're rich with thieves stealing things. And it just depends on where the product's coming from and where the transfer stations are. So these are just some areas that you might want to be concerned about when you're underwriting or you're looking at risk and saying, oh, my gosh, I saw this presentation and they said, I need to worry about Texas because of the theft in terminals and all that. I remember seeing during COVID they had in in L.A. in California, they had that L.A. has a real big problem with theft at terminals, especially where goods come in from overseas and they have the storage. The the containers in a storage yard and they have they had thieves come in and just break into them and just steal things and they couldn't do anything to stop them. So you just have to watch where the goods are coming into when the insurer's responsibility starts and how they're protecting it when they're in these areas. I think this is an interesting one. I'm not sure if this is on the poll or not. It isn't, but that's OK. So what do you think the average day of the day of the week is the highest with respects to theft? I'm going to keep going because it's I think it's interesting. It's actually Sunday and that's because the goods have been stored over the weekend, like in a lot of places, especially if it's long haul or if they only deliver Monday to Friday, then it sits idle over the weekend and Saturday it sits there and people realizes trucks aren't moving and they can kind of case the place and Sunday they steal it right before it gets shipped out on Monday. So Sunday is the highest, the day with the highest amount of theft. So, again, the truck stop and rest areas, unsecured lots, warehouses, hijacks, hijacks definitely are something to be concerned about. But those are usually high target items. That's cars like expensive cars that might be stolen. It might be electronics. It might be pharmaceuticals. It's those are definitely gang type. There's operations where they steal, they steal the hijacked items. It's it's pretty well. It's pretty well known it's in areas that that you that they can case it and they can know what it is and they watch it and it's it's very well controlled by the thieves. So it's kind of interesting. I don't think I've ever had a hijack on anything I've done, but I don't do high hazard commodities throughout my career. So I just I've just read enough about them. So some recommendations for protecting your goods while they're being transported, again, this is kind of lost control. Part of part of this presentation is the carriers that that that they're operating, they're carrying items in like that carrier. So, you know, most people don't do live animals, but there are live animals and you want to make sure that that, you know, you're the animals are protected and then also vetting the carrier. So your carrier, does your carrier have your carrier itself for overall commodities? Do they have experience in hauling what you're hauling, making sure they know what they're doing, making sure that they're used to the loads and the size that they have? Do they have the proper limits in place so that you're protected as an additional insured if you're under their insurance and you have a bill of lading for a motor carrier and that they have that they have the training in place? Do they have written safety procedures? Do they have route? Do they know what the routes look like? Are they are they prepared? Again, we don't mention here, but your your GPS, your immobilization, immobilization devices. So if your truck does get stolen, do you have a turn off so that you shut the car off and they can't go anywhere? Then they're stuck and you can catch them. So there's different things that they can do, especially with technology. You know, don't leave your load unattended. It's harder when you've got one driver and he has to stop at a rest area and use the restroom or take get up and take a take a walk. But on higher hazard commodities, you want to have tandem drivers so one can one can always be with the truck and you're protecting your load at all times. Contamination, making sure you're not storing, you know, food products with something that can leak or have a smell that goes into another item. I always I had one I had one I read about years ago when I first started. It was a load of fertilizer that they hauled with flour. OK, seriously. So the flour is now all contaminated with the smell of the. Fertilizer and it all had to go, I mean, the fertilizer was fine, but the flour part of the load got contaminated by the smell. So are they back hauling? So they're delivering wood products, but they don't clean the truck out and then they're bringing food back. So is there is there contamination that's been caused by them not cleaning out their trucks in between use? Do they have infestation? Again, bugs that might be in bulk cargo that might get into some food products. Again, preloading like pre and post inspections are always important. And then just making sure your packaging makes sense. Again, keeping going with your carrier selection, what's their reputation? We can find a lot online now at Google, anybody, you can find out what you need. You can find out reviews of people, customers, you can get BBB ratings. What's their stability? We mentioned the CAB. If they're unsatisfactory or poor, you don't want to get anywhere near them. How old are their trucks? How old are their trailers? How are they maintained? What's their driving record? Well, how do they handle their cargo? How do they hire the people that drive for them? It's all that all plays into writing a really good transportation risk. Claims handling, I'm going to touch on, I've never been a claims adjuster. When the claims does look at a risk that's had a loss, they're going to verify what the coverage is and who's responsible for it. They're going to try to get a police report or take witness statements as to what happened. Usually, even all claims, there should be 24-7 claims availability, especially in a cargo that's something that's time sensitive. You want to make sure that your company you're dealing with has claims that can come in and be there because time is of issue on any kind of transportation risk because they have to get that item from point A to point B. Is there salvage or subrogation that someone else caused the loss? Can you sell off the rest of the product that's been damaged? They released it to the company and then you're insured we'll get some money back if they can salvage any part of it. That was my last one. I surprised myself. I'm just so used to not claims. That's it for the presentation. I know I went through the last part fast, but a lot of it tied into the first part of the underwriting. I really appreciate your attention and your questions. Thank you very much. It had a question with respects to access to the PowerPoint. Eileen, I think you said on the invitation, there's a spot that they can click for the PowerPoints. Yeah, it's on the handout section, Diane. Lillian, thank you. Yes. So there's a handout tab that everyone has access to and they can click on that and they can get, there's two parts to the slides. So both sections are there. So John, I hope that answers your question. And that's it for me. Thank you so much. All right. Thank you so much, Diane. Really appreciate that. This is very informative. So are you ready to announce the recipient for our $25 Amazon gift card? Yeah, I think I'm going to pick Philip Moore. He has two really interesting questions and I appreciate him making me think today on a Tuesday afternoon. Excellent. Congratulations, Philip. We'll send a $25 Amazon gift card to you. That's me clapping. Yes. Well, thank you to you, Diane, for sharing your expertise with us today. Thanks also to my colleagues, Eileen and Ali Monreale for working to coordinate the session today. I'd also like to thank you, our attendees, for your participation and your questions. We look forward to seeing you this upcoming Monday for the Introduction to Builder's Risk class, and you'll use the same link to join. Enjoy the rest of your day. This concludes today's class. Thank you, everyone.

motor truck cargo insurance

Diane

training

cargo protection

transportation risks

loss prevention strategies

securing loads

driver selection

equipment maintenance

GPS tracking

technology for safety

cargo storage

at-rest protection

handling risks

claim handling

Inland Marine Insurance

Transportation Insurance

Underwriting Considerations

Coverage Types

Diane Springle

Consignor vs. Consignee

Motor Carriers

Valuation Considerations

Carmack Amendment

Federal Motor Carrier Safety Administration

Risk Management

Claims Handling

Driver Training

Philip Moore