hosted by Inland Marine Underwriters Association. I'm Eileen Monreale, Education Training Specialist at IMUA. Thanks for joining us today. I want to thank William Coulson and Eileen Monreale for their work behind the scenes to ensure the success of today's work. On your screen, you will see the attendees control panel where you can view who else is in the meeting, and we have a great turnout today. I think they're slowly all logging on, so we'll see that number climb as I complete my introduction. This is also where you can download the PDF of the presentation in the handouts section, and lastly, it's where you can see the question box to share your questions or even comments with our presenters. If the control panel minimizes by default, simply click the orange arrow to bring it back, and you can always go to view on the menu of the control panel and uncheck auto-hide option, so that won't keep happening. Our presenters look forward to your questions at the end of the presentation, but do feel free to enter them at any time, and actually, our moderator will monitor them throughout the webinar and may even pose those questions during the webinar if they are appropriate having to do with the content that is being discussed at that time. So to encourage your engagement, which we always love, IMUA will award a $25 Amazon e-gift card to the most engaged attendee as a token of our appreciation. That's like most best questions. Most questions are best questions. Again, it's just to offer attendee appreciation and to encourage your engagement because we all learn better when we are engaged, and now I'm honored to introduce Jason Baynard, Vice President, NBIS Construction and Transportation Insurance Services at Dual Insurance. Jason is a member of IMUA's Transportation Committee, and he's a veteran IMUA instructor who has presented at the IMUA annual meeting and several intro track classes, as well as in the Installation and Rigging Beyond the Boom class in 2022, and that class, along with over 150 hours of on-demand education, is now available at no cost to IMUA members, so check it out. Jason is acting in a dual role today as moderator and presenter, so please take it away, Jason. All right, guys. Yeah, thanks for the intro, Eileen. I'm really excited to be here with you all. As I was reflecting in preparation for this time, I know the majority of the attendees on the call are underwriters, and beyond builder's risk, dare I say, motor truck cargo is probably one of the most expansive lines of business within the Inland Marine space, and I got a feeling that this time is going to resonate very well with the audience, and so as Eileen just mentioned, guys, we want this to be informational. I really want to hear from you throughout the presentation as we have two very esteemed guests that'll be joining us, and so I encourage you guys to ask questions along the way, and so with that said, I'll take it away. Our presenters today are going to be Janelle Griffin, who is the managing director of American and North American logistics leader of Marsh LLC, so welcome, Janelle. Glad to have you on board, and then we also have Michael Caney, who's the chief commercial officer of Highway, and we'll have him explain exactly what Highway is and what they do, but thanks for joining us, guys. Really excited to have you on board. Yeah, happy to be here, man. Thank you. Thank you. So as we think about the agenda today, we'll touch upon a couple of things. We'll just talk about a macro overview of the rise of cargo theft. You know, it's something that impacts us all, and I know one of the things we've been collectively pushing as a team is just investment in technology amongst our insureds. Also in preparation for the time, you know, I had a chance to really survey a lot of my peers, some of you who may be on the call, but just really get a better insight of what really matters to you, and what is your perceptions around motor truck cargo theft amongst some different classes, and so we'll share some feedback in that regard. We'll talk about some cargo theft updates and statistics, as well as risk transfer solutions, which I know are a big part. Our focus on this time is obviously technology in relation to mitigating loss, but then also as far as maybe some potential transfer of risk solutions that can also correspond with some of the technology. Obviously, data mitigation, digital solutions, and then also a question and answer session at the end, that just really surveying, you know, guys, what can we do across the board to mitigate motor truck cargo theft, because it all impacts us as an industry. Okay, so just kind of jumping right in. I wanted to start with a poll question. Again, my high suspicion is that the large majority of you on the call do engage in motor truck cargo exposures, but when it comes specifically to cargo theft, and I know depending on the market that you currently represent or the carrier you work for, cargo theft may be a heightened result or maybe not so much. And so we were gonna lean into a quick polling question just so that we can get a better idea of what our audience looks like today. So the question is, what is your familiarity with cargo theft? Very familiar, hopefully it's not too many of you all, marginally familiar or not familiar at all. So we'll allow you guys a few minutes to respond accordingly. All right, so yeah, you know, I think Janelle, Michael, this is very telling, right? I think, as I suspected, we all collectively suspected, everybody on this call is impacted by this topic, right? And so I think it's very timely. And again, look forward to your feedback. Do you guys have any initial thoughts to share on this? Yeah, well, from my perspective, yeah, from my perspective, it's, I think it's great. The very familiar is wonderful. It gives us an idea of, you know, who our audience is, but it also is really indicative of what we're, what we're facing as an industry. You know, cargo theft is one of those things where, you know, gone are the days where, where underwriters are saying that other more casualty focused lines of coverage are really the bane of your existence. At this point, it really is cargo, and we're hearing it time and time again. And there are so many stakeholders that are that are really invested in figuring out what's happening with cargo theft. And how do we how do we mitigate that specifically, because it's not just the cargo owners, it's not just the, you know, from a first party perspective, but it's the third party logistics entities as well. And then all of us insurers and underwriters that are being affected. And I think the thing that's interesting about the poll result, and what you're talking about, you know, it's this for the first time since I've been doing this for 20 years. It's not someone else's problem. So as an intermediary or a trucking company, like, it's always like, how can we transfer the risk? And it's somebody else's problem. It doesn't happen very much. I'll just file a claim or I'll make it. It's for the first time, it's like, we should probably all solve the problem together. Where before, and look, I've been a freight broker for 20 years, right? So I've probably been responsible for me as an industry for a lot of claims that get paid or underwritten by people on this call. But but it's now where the audience, this audience, the collective industry audience is like, it's everyone's problem. And it's it's impacting people at the at the grocery store. Like it's impacting people. It's it's causing massive disruption and cost increases in the supply chain is not just an insurance issue. Right? This this is rippling across the industry. Yeah, absolutely. Absolutely. And guys, here's just some data that we had pulled up from CargoNet. And, you know, one of the things I do want to encourage the audience to do, Eileen and the IMUA team has been putting out the QuickBytes. And so there was a gentleman from Veraris that's done a motor truck cargo theft QuickBytes that went up earlier this year. And so I encourage you guys to check it out. But really, what we're looking at right here is the most recent Q3 numbers for 2024 around cargo theft and so reported thefts, right? Now, you recognize CargoNet is probably as legitimate as it comes as far as data. So we're looking at 775 cargo claims nationwide, primarily stemming from warehouse and distribution centers, as well as truck stops. As you can imagine, high hit rates when we talk about cargo theft, geographic locations, warehousing, truck stops are going to be probably your number one spaces to get hit. In addition, top three targeted states are California, Texas, and actually Illinois. And so, you know, you're densely populated. Oftentimes your port cities are creating these sorts of scenarios. And so I know all of us that are touching it from an underwriting perspective, if you're doing legitimate motor truck cargo premium within your portfolio, our hunch is that a good segment of your theft losses are probably occurring in these third state, these three states as demonstrated, with Florida not lagging too far behind. As far as commodities, I think that it's very interesting when we talk about potential commodities that are being hit. Obviously, the top are going to be kind of your food and beverage, as well as electronics. But even kind of peeling the onion back on that, you know, a lot of it can look like, you know, obviously your electronic goods, but, you know, skincare products is something that's been on the rise that we've seen through data. Vitamins and supplements, right? Obviously- Yeah, that's what I was going to say, Jason. Like wellness, like things in that wellness category, for some reason, we've seen, especially out of Southern California, we've seen a major target. Like it is a full blown targeted commodity at this point. Sure. Skincare, like wellness, like anything in that whole wellness, I think it's all the kids on TikTok buying it, if I'm having to guess, just to be real honest with you, but like there's a whole spike in wellness product thefts. Yeah, no doubt. It makes a lot of sense. Obviously, liquor and alcohol still remains a high targeted commodity. Footwear, right? And traditional clothes, electronics, you know, so again, these are just some of the commodities that we're being asked to come up with creative ways to ensure on a day-to-day basis, but those tend to be more of the high hazard classes amongst others, right? I mean, anything with street value obviously has the opportunity to be hit. And, you know, Michael, as we look at this kind of data, I think it'd be a good time for maybe you to jump in and just introduce what Highway does and kind of what the impact, how you serve the industry when it comes to what your organization offers. Yeah, thank you. I appreciate it. Am I supposed to move slides here? What's happening? So yeah, go ahead. Yeah, so the way that Highway works is we solve essentially the identity problem between a third-party motor carrier and an intermediary or a freight broker. So when I say intermediary, I want to speak really broadly, right? Because as underwriters, you're thinking about different types of intermediaries, 4PLs, 3PLs, largely traditional freight brokers, freight forwarders, right? So anyone that's hiring a third-party motor carrier for the transport of cargo. We operate primarily in the full truckload Class 8 space. And what we saw when we surveyed the fraud market is we kind of thought about it the way financial markets think about, you know, know your customer, know your business, which is the core of it is an identity problem. And so what our technology and our service does is we work to resolve three things that before Highway were completely hidden or obfuscated. Number one is who is a user? Who is the human being that is trying to represent a motor carrier and go authenticate themselves? Or we used to call it onboarding with a freight broker. That's number one. Number two is, are they authorized to work on behalf of that carrier? So we're really thoughtful and our tech is really good at sussing out, are they a fake person? Are they pretending to be someone else? Are they a dispatch service trying to masquerade as a motor carrier? And so that's the second piece, the authorization. And the third piece, this is what's really critical, is capability, right? So does the represented entity have the appropriate equipment, insurance, all of the things to actually do the tasks that they're representing that they can do? And so a lot of what we're going to talk about today is that what's happened in the rise of cargo theft and cargo crime and the way it's become strategic is it's no longer just someone trying to figure out how to get a hold of a load or double, like those were the easy days, right? This is cybercrime. And so for the first time ever, you have international cybercrime, like large groups of people from all over the world, and we can share some stats on that, that are working with a cyber strategy to get a hold of physical goods. And so we live in the world to try to pull those threads and figure out who the good guys and bad guys are. So that's essentially what we do. We do it all day long. We look at 21,000 connections a day. We've looked at 5 million loads this year. We can get into all that, but we live in the data that exists between freight brokers and motor carriers. Man, that is fantastic. And thanks for teeing that up in that manner. And I really wanted to get you to get that off in the sense that in preparation for the time, as I mentioned earlier, I had an opportunity to survey several different underwriters, retail agents, and even claims people just around their most up-to-date perceptions around motor truck cargo theft, right? And what really impacts them depending on what touch point within the industry they're actually representing. And so to your point, underwriter concerns really looked like limited controls. What are our insurers out there really doing? What are they intentionally putting in place to mitigate risk? I think there's still a lot of questions around that. Oftentimes, opportunities for recovery. It seems like our opportunities to actually recover loads are becoming less over time. To your point, maybe circa pre-COVID, if three intermodal trailers get stolen, maybe we get two back, right? There was no need, or maybe it was an overaggressive heist. We're not really seeing that with the most recent data. So there's certainly some apprehension there. I think, as you mentioned with the cyber exposure, there's newer perils, right? Unvetted challenges is cyber crime. What exactly are we underwriting to, right? And is it not maybe necessarily a standard bill of lading loss that traditional motor truck cargo has been prepared to meet? Opportunities for risk transfer. What is an insurable risk and what's not? And I know, Janelle, Michael, you'll have a chance to speak on all of these. Shippers' interest policies, right? Is there an opportunity to get better on that side? And how could that help our insureds from a production standpoint? And again, 3PLs, what's the difference between a freight broker and a freight forwarder? We talked about geographic hotspots, but these are just some things, guys, that I was able to survey just talking to several people within the industry and really just looking for Janelle and Michael to educate us all. And again, as we get ready to kind of lean into them, I really encourage you guys to ask questions. And with that said, Janelle, I will go ahead and turn it over to you. Thank you. So I love, Michael, that you said you kind of framed this conversation in a way that talks about where we are now, right? Versus where we were. Because, you know, when we think about cargo theft, gone are the days of smash and grabs, right? You might still have your traditional smash and grab, but this is not, we're not living in that day and age. We're living in a day and age where we have extremely technologically enabled bad actors. And how best to combat technologically enabled bad actors by becoming technologically enabled ourselves, right? So this is why I appreciate, you know, Highway and other entities that are similar, because we really do need, we need help to collectively combat this specific risk. You know, one of the things that we've talked about is that, like you said, this is not something that is just, it's not just a US problem. This is a global problem. And Jason, your stats, when you put up that cargo net infographic, that is exactly what we're dealing with. And that's just for Q3. So if we think about last year from a global perspective, and we think about cargo theft last year, I believe the stats were that globally there was over $30 billion in cargo theft globally, which is insane if you think about how much that is. But the reason why is because it's technologically enabled. Gone are the days where, you know, criminal actors are coming in and again, smashing, grabbing and getting that cargo. Instead now they are sitting back behind a computer and orchestrating it so that the cargo comes to them. The cargo now goes to wherever they deem, they decide that it where it has to go. And so that's a very different, it's a different risk. And what we find is that, you know, from our perspective, from an insurance and a risk perspective, it's almost like we're chasing sometimes it feels like we're chasing our tail, right? So every single time, you know, there's a there's a new theft ring, or every time there's a theft, like you said, Jason, it's sometimes difficult to recover, because we really were not understanding exactly where it is, there are few trends, when we can find those trends, and where we can pull those strings, we can we can trace it back to the originators and particular rings, but it's really not that easy, right? It's not an easy thing. You know, when we think about what I spoke earlier, when I spoke earlier, and I said, this is something that is a full supply chain issue, but it's also something that is not, it's not purely a cargo, cargo owner issue, right? This is something that affects all of us. So we'll start with a full question. So what are some of the key factors contributing to cargo theft in the supply chain? We'll give it a minute. So there's lack of visibility, there's worker or employee shortages, criminal technology, expertise, or all of the above. Love it. All of the above. Yes, absolutely. But see, this harkens back to the first poll, Jason. This means that everybody on this call is probably an expert already, right? Everyone knows all about cargo theft. But yeah, it's all of the above. When we're thinking about lack of visibility, I would say that's probably the number one issue right now in the supply chain. We always talk about the fact that you have your first tier of the supply chain, where a 3PL might have that first tier where it's really bizarre and who they're working with. But what becomes less and less transparent is all of the supply chain tiers below that. Also, are they subcontracting too? So lack of visibility in the supply chain is definitely an issue, which is why sometimes there's inadequate tracking of shipments. It makes it difficult to really respond to theft. The other one is the worker and employee shortages. I mean, if we think just about driver shortages, truck driver shortages, fewer drivers means what? It means that you have longer transit times. It means that you have fewer potential protections. And all of these things do factor into cargo theft. And then the last thing that I stated earlier is the criminal technology expertise. These bad actors have become so adept at figuring out how to divert cargo and how to move things. It becomes really challenging for us from a risk perspective to figure out how we then combat that. One of the things that we've seen now is that there have been increased efforts to do so, which is always certainly a positive thing. And we think that these are the things that are going to continue to bolster some of the mitigation efforts. Like Michael said earlier, it's one of those things where we really all have to work together because unless we work together, then we're not going to have the visibility. We're not going to necessarily have the capability to understand where along the supply chain most of these are happening. What we find is that a lot of the entities that are really hard hit by cargo theft don't fully report it. So there's, again, lack of visibility even into the reporting. And they're trying to limit their sublimit. Yes, exactly. For all of those reasons. They're not reporting it. And so obviously, a lot of times from an insurance perspective and a risk management perspective, we want to know, but a lot of the entities don't report it because, again, they also want to manage their image. So there's that too, right? What shipper is going to want to move cargo with a 3PL who says that they've been hit, you know, that 30%, 40% of their loads were hit by bad actors? So a lot of this is, there's a lot of underreporting when we look at the stats. Yeah, absolutely. That's all really good information. And before we even jump on, you've actually thrown out the term a couple of times. I know we have a variety of skill levels on the call, but can you break down 3PLs, right? And what does that really mean? Who's involved in that structure? If you could just explain that to our audience. Yes, absolutely. So let me just, I think I skipped over it. There we go. So we can talk about some of the people, some of the stakeholders, some of the people who are affected. So a 3PL, 3PL is a third-party logistics entity, and that is almost a, it's a catch-all for any entity that carries goods of others that is responsible from a professional liability standpoint. They're responsible for carrying the goods of others. And the people who are affected by cargo theft, I'd start out first by the shipper. We talked about that first party, it's the cargo owner. And the type of insurance that is affected for them is their all-risk cargo insurance, that first-party cargo. We also talked about shipper's interest, right? So the shipper's interest that is essentially purchased by a cargo owner through a logistics entity, that's the reason why it's shipper's interest, all cargo insurance. The shipper's interest is also affected by cargo theft. From a trucker standpoint, truckers are also affected, but what's affected for them is the motor truck cargo legal liability policy. That's the policy that's hit if there's any loss or damage to the cargo while in the care and custody of a trucker. For a freight forwarder, who is also a 3PL, freight forwarder and freight broker are different in that a freight forwarder takes responsibility for the cargo across multiple conveyances. So they actually take responsibility for the cargo as an air carrier, as an ocean carrier, as a warehouse keeper, they do customs brokerage, they do all of that. That is a freight forwarder. So what happens is their freight forwarder's legal liability policy is the one that's triggered in the event of loss or damage in their care and custody. The difference between a freight forwarder and a freight broker is that a freight broker, we always say their exposure is purely contingent because they're really like the travel agent for the cargo. They have a network of truckers, they are a freight broker, so they assist a first party cargo insured, ultimately, they assist the first party cargo owner and they place their shipment with their network of truckers. So really all a freight broker does is they are a true intermediary, they're in the middle of that transaction. We get put into the transaction. We're going to talk about that because you're right, Janelle, but here's the thing, as a recovering freight broker, shippers and plaintiff attorneys keep trying to make freight brokers more than they are. All the time. With egregious indemnification clauses, first of all, that shippers ask brokers to sign every day. They're constantly trying to transfer all the risk away from the shipper and into the freight broker and get the freight brokers to pit themselves against each other in pricing and contract wars until freight brokers just take on a lot of risk. And then you have a litigious system that's just like they go find the money with the freight broker and so freight brokers live in this juxtaposition between negligent hiring and vicarious liability. So Janelle and I will all day long say we're just a freight broker until somebody wants to sue somebody. And so there's a lot of the freight broker who is just the freight broker has to constantly balance more risk than anyone. Yeah, you're right about that. That's where. So the difficulty with that, though, Michael, is that, you know, you if you're speaking from a freight broker perspective, that is the absolute freight broker perspective where, you know, as an as an intermediary, they're the ultimate intermediary caught in the middle, right? Literally between a rock and a hard place. They want to do business. They're being forced to take on additional liability by the shipper or else they're put out of business. And then the truckers that they are that they are essentially appointing have less and less coverage. They're like a lot of the coverage that we're seeing on a trucker standpoint, you know, it's limited. No money. And so for the audience, right? I'm not sure the scope of underwriting that exists here. So I apologize if I'm being too rudimentary, but freight brokers like my customers, all thousand of them and what I did forever, we live in the long tail of market. So 96% of motor carrier fleets are 20 trucks or less. And I mean, what's turnover now, Janelle, I mean, they're moving drivers are turning over 100% a year. So you just watch the vans move all the time. So not only do we deal with small businesses, they don't have any money. And so to even be able to go, if you if you've got a judgment for a claimer, like there is no coverage and there is no money in the small motor carrier world. Which is why they just keep trying to transfer risk to the freight broker. And this is something that unfortunately, the plaintiff's bar has gotten quite adept at, right? The plaintiff's bar has been able to find ways to change and shift, you know, F4A in ways that the freight broker is pulled in and liable, not just for bodily injury, right? For cargo theft as well, in ways that we don't think that that freight brokers are liable, but the reality then, right, speaking from a freight broker perspective, this is what we see. But the reality speaking from when I speak to underwriters, I speak to insurance markets, they ultimately say that is not that is not your responsibility. That is not your liability. This is this is the policy. This is how it's written. You're either liable or not liable. And so, you know, freight brokers are finding it very difficult because they're looking for expanded coverages so that they can cover some of their risk and change for some of that risk. And it's not always easily available. So, Janelle, if I was back in a freight brokerage, let's just give the audience like a look like what that would look like if we were sitting down and talking and you might say, Michael, you really need to do a better job of hiring these carriers. You need to go get this data and you need to go do that. Well, I might say, well, are you going to are you going to are you going to defend me? How much coverage am I going to get if I get named in a vicarious liability lawsuit because I go pull all this data into my system and I do all these things? And so this is the back and forth that an intermediary has with their insurance broker. Well, if I do this, we don't want to pay the claim. But if I don't do it and then I do this, so what do I get insurance for if I'm a freight broker? Yeah, I think that's where I sit like as a broker and I did this, right? That's where I sit. Like, what do I actually get insurance for? You know, and I think as we talk about freight forwarders and freight brokers, I'm getting a couple of questions in and one of the questions is in from Gina. She had asked, is artificial intelligence becoming more of an issue for crime? I suspect I would know the answer, but Michael, Janelle, feel free to answer. And does that impact one of these segments, whether it's your first party trucker or your shipper or your freight forwarder, one more than the other when we talk about artificial intelligence? So I'll talk about that and what we're seeing. If you want to go to my slide with the data on it, it's probably really helpful to just show the audience kind of where we live. So this data is meant to just give you an idea of how vast the attacks are and the variety of vectors, right? So we'll talk about is AI a part of the crime issue, but let's just set the table with fraud needs three things to exist and thrive. One is the prospect of gain, right? And so when you think about prospect of gain in terms of what we do, like I think there was a, the big train heist that was just in Chicago and it's like, it's like all over the internet, like, like hundreds of people, like I think two people were arrested on misdemeanor charges, right? So you have a high prospect of gain and, you know, Janelle and I are friends with Scott Cornell and he said he's busted the same family like three times for two generations, right? So you have a, you have a low, you have a low penal impact, right? So you have prospect of gain urgency. And so when we think about supply chain, everything is urgent, everything has to go. Everything is, especially over the last few years with last minute deliveries and just in time. And then finally you need anonymity. And so when Janelle put that polling question up about like, what are, what are these things are the most, and everyone said all of the above, that's where the urgency and the anonymity live. All right. So the data that you're seeing here is there are 15,000 registered freight brokers. There's about 8,000 that are legitimate and there's about 1,200 that move most of the freight, right? And among that sample set, this is what we, we see 20,000 phone numbers changed this year alone with the FMCSA. So we look at the FMCSA file every day, right? And when we're actually like notifying motor carriers, Hey, did you know that your phone number and your email and your contact's been changed, right? And so like, like one of the, one of the vectors that happened is that like somebody downloaded the entire contact file from the FMCSA and ran a script to look at variances in email addresses and corrected them and got, I don't even know how it works. I can't explain it as well as our CEO does, but it's really technical. It's very hard to do. And they did it. They did it to, they compromised thousands of accounts in a short amount of time, right? We've had over almost 3,000 identity alerts posted. We have a, we have a VoIP product that looks at our fraud database and scans incoming calls to freight brokers. And we, we block anywhere from five to 10% of phone calls. So what I want to say is like, to answer the AI question specifically, Jason is yeah, an AI agent, right? That type of technology can be used to automate all of these attacks. So a human can do it, you can do it with just really good SQL queries. And yeah, a bad actor could absolutely use a bot to do this. The takeaway is not, is it AI or is it a good old fashioned SQL query? It's that it's constantly changing and you have to be constantly adapting. And there's no, there's no human, there's no, there's no checklist, there's no compliance department at any forward or intermediary that can keep up with it. This is now a technology problem. This isn't a compliance leaders problem, right? This almost needs to begin living in somewhere between like compliance in an intermediary and the chief information security officer, right? It's the same, it's similar vectors, it's phishing, it's anything to get a hold of something just to gain information, right? So, and then look at the countries below, the top six countries. So what I'll say unapologetically is that most of this activity comes from foreign countries that are very anti-Western, right? And they're operating somewhere else and they are controlling people operating class eight trucks in the United States for the purpose of stealing things. All right, so these are people that in the same office will operate 50 MC numbers and they'll do so legitimately, meaning they'll pick up and they'll deliver the freight. So they'll get into your network and they'll pick it up and deliver it. And they're holding another 50 MC numbers and they're going to gain all of the intelligence from casing the neighborhood of moving that freight to understand where all those wellness products are, Jason. They're going to go learn, they're going to go haul freight and they're going to learn and they're going to take those other 50 MC numbers and they don't care if they burn them and they're going to go steal all that, right? And like Janelle said, it's not smash and grab anymore. I need to steal 10 or 20 loads at a time because we've gotten better, so now the bad actors have to get better. You see what I'm saying? So it's this massive, they're trying to find exposure points in massive amounts of data. They're trying to gain massive amounts of intel and then just engage in a lot of theft at one time. And so we're seeing a lot more theft come bigger and in waves. So they'll do, I'll steal 10 loads at a time or 20 loads at a time as opposed to stealing a load a day. Does that make sense? It does. And unfortunately you have an audience of primarily underwriters who are probably passing out in their seat like I am when we start to hear some of this data, right? This is some really intense stuff, right? When we talk about exposures and aggregates of limits, those are some real scenarios that you're presenting there. Yeah, but I think at the same time, Jason, though, I feel like it's not, it's a terrible situation that we're all dealing with collectively, but it's not all doom and gloom because like Michael said, unfortunately it's cyclical, but there are things that 3PLs can do to ultimately integrate technology into their actual logistics operations so that they can mitigate that cargo theft. We have real-time tracking, we have predictive analytics, we have enhanced security. All of the things, technology is available to our clients and I can say from a logistics industry perspective, there's so much technology out there. There's a lot of technology that our clients are actually using. The question is, what are we doing from an insurance perspective to use that data, to use that, the data that we can garner from the technology that they're using to mitigate cargo theft to really help them and help support those of our clients that are doing the right thing, right? Well, I think- Yeah, so let's take a moment to really peel that onion back, right? Because that's it, right? So as underwriters, oftentimes we'll get a submission, we'll get an application with some check boxes and some loss runs and an agent that's normally pressing us to turn around a quote. Yeah. So to equip us, Michael, Janelle, how can we probe better? What should we be looking for at the underwriting desk so that we can separate the insureds that are intentionally good versus the ones that are just lucky and are bound to have a loss? Yeah. Because it almost seems like it's a matter of when instead of- Yeah. Yeah, I think Janelle's going to have her opinion because she runs an entire practice around this. But what I would say is that I think if you're an underwriter, asking how to probe is almost it's not worth it. You can't. Because we're going to tell you, we're going to say we have a great program and we use this, and then you're going to ask us at renewal why we lost a bunch of loads. And we're going to have that conversation every 12 months. And I think the reason that Janelle and I started talking is we share some customers and we both just share this idea that there should be a different way of looking at this. Some of these inland marine firms are 100 years old and we just keep adding things to them to augment them to try to make them modern. And it's like, hey, I can tell you at the load level in our software whether a carrier should be hauling a load with that carrier in a very specific origin destination. I can help you underwrite to that standard. And so Janelle and I have been talking for about a year and it's like, hey, why don't we reward the people that do that? And if we actually worked to reward the people that do that and allowed some of that to be an insurable risk, okay, if this broker does all of these things, can we reward them? Can we help them? And in doing so, can we drive more transportation, more freight in North America to those good intermediaries? Can we divide the world between the brokers that don't really do good things and can we consolidate to the good brokers? If we create the right incentive alignment, if we are open with like, hey, if you do these things, we're going to underwrite you differently. Now, I don't know anything about underwriting. I just paid a lot of insurance premiums in my life and that's how this conversation got started. But that was the idea because I can help an underwriter understand what a group of freight brokers is actually doing and brokers actually want it. Their premiums have gone sky high. Yeah. So, Gina, you can give a more professional insurance opinion. Now, you know, I love this. I love the different perspectives because it's exactly what it's, this is reality. That's exactly how it is, right? Where I sit from our perspective, we're seeing both sides because, you know, I have my fiduciary who is the client, right? The logistics entity. But I also have a duty and a responsibility to our insurer partners and we don't want to put bad risks with our insurance partners. We want to figure out how we bring both sides of the house together because at the end of the day, the insurers and I are sharing a client, right? You are our collective clients and we want to make sure that we're doing the best for all involved. And you and I share a client. Exactly. We're all in this together, like literally. Exactly. Exactly. That's the point. And so, asking for collective, asking for information or asking for additional information, these are the things that I think, I think would help you guys as underwriters really start to see the risk better. It's increased visibility. We talked about lack of visibility in the supply chain, but there's also lack of visibility in underwriting. I think a lot of times with all of the technology that our clients essentially have deployed, all of the things that they've done, sometimes asking these questions like, you know, do you use historical data to identify your high risk area? Or are you using historical data to identify various routes or various times and time periods for theft? So, we have lots of clients that subscribe to Highway and lots of clients that are subscribed to CargoNet and other entities that are similar to that. And they're actually using this data to help them map their routes. So if, but then you have others that don't do that at all. We'll use it as a user story, right? So, hey, I am a freight broker. I need to evaluate my data to better understand this for my underwriter. Like for us, we're like, oh, we have that data. You just need to have, be able to look at it this way. And then you need to be able to enforce the result this way. That is something that we can code and automate. Like the whole thing about this that everyone needs to understand is like when a human is involved in this process of managing this data set that's in front of you, it will fail. Right? It would be like everyone on this call, like not having Norton antivirus and just like running antivirus yourself because somebody hung a checklist up in your cubicle. And I'm not being facetious. Like that's how freight brokers did it before Highway. There was one provider that monitored insurance and they provided an online contract because I used them. And then we hung up a checklist in our cubicle and we looked at three different websites and we trained people on what to look for. It was that bad. That's how it was done before Highway because I built it. And so I think today we're in a position to say, hey, we want to be able to actually take in this data that we learn about from losses and like programmatically solve the problem. Like highlight, like get ahead of it and proactively say, these four data points point to a potential problem. Slow down and like actually slow the broker down without them having to train a group of human beings to look out for that. Because that's really difficult. It's very, very difficult to do. Yeah, absolutely. And I think, so I think in addition to that, that's really on the 3PL side, right? So the 3PLs are trying and they're doing things proactively. What they're asking for is really recognition on the insurance side because they're still paying a lot of these increased premiums. And so, you know, more bespoke underwriting and asking questions like, you know, are you, you know, what sort of mechanisms do you have in place for safety and security? Have you increased any of that? Are you using blockchain? Are you using Internet of Things? All of those, all of these things are really, really good questions that nine times out of 10 we don't get. You know, and to your point, Michael, you had mentioned about some of the forms being a little obsolete and not really meeting the market where the troubles are. You know, it sounds like one of the takeaways is to make sure that if you are active in the motor truck cargo class, or even more importantly, as you get into freight forwarders and brokers, to make sure that you're updating your supplemental apps accordingly, to make sure that we're asking more current and up-to-date questions around data and usage of technology. I think that that's where we're at in 2024. I mean, it's a fair assumption there, correct? And I also think that there's a real opportunity to innovate. I really think that with what we do and what some other providers are able to do in the physical space, like Tibe and GenLogs and vendors like that, that for the carrier and the underwriter and all the different layers on those risk products, there's a real opportunity to innovate and do some things differently. Yeah, completely agree. Yeah, for sure. Go ahead, Genelle, please. Yeah, no, no, I was just gonna say one more thing on that subject is that, you know, as I do commend, there are multiple insurers that are currently looking at partnering with loss prevention consultants that work directly to try their hardest to break up these rings and to try to really work to track down these loads. So I do commend. I think that there's a desire to do that, but there's still, it's kind of like a demystification we have to do around cargo theft itself and the how. There's so much going on. I feel like a lot of our insurers don't really know what to tackle and where to tackle it first. Yeah. Yeah, to that point, it sounds like there's an opportunity to partner, correct? I mean, that's really the purpose of this time, guys, is that we really wanna try to start brainstorming more in a macro manner with strategic touch points, obviously, agent market experts like Janelle, and then people on the street like Michael who have a really boots on the ground perspective on what our insurers are facing so that we can get a little bit more pointed as far as our line of questioning and our ability to aggregate data beyond maybe what we have specific to motor truck cargo theft. A couple of questions that have come in. One, it says, I've been in underwriting motor truck cargo for 20 plus years and I've seen an uptick in higher employee dishonesty sublimits. Is there any commentary around this and should driver vetting become more robust? I'll open that up to either of you. You wanna talk about driver vetting, Michael? So driver vetting is a tough one, right? Because I think, so I live at a very strange intersection in that I'm a private enterprise software and service provider. And a lot of what comes down from a driver vetting issue is a failure on the FMCSA to do their job. It's not enough inspectors, right? And so, and you have motor carriers that are registered like illegally, like they registered with like BAC-3 email addresses, Staples, UPS stores, which you're technically not supposed to be able to do according to FMCSA regulations. So I think, here's what I honestly think, that if we corrected some of the problems with the identity, it would naturally take care of some of the driver issues. I think one of the problems that we have in all of this question of risk management is we keep going down to like an issue, right? And so it's really interesting that this got attached to a question about driver vetting and employee dishonesty sublimits, right? And that's what I keep seeing in insurance. There's a sublimit for everything. And so we just keep tackling like these ticky-tack issues and none of that's the problem. Like if that was the problem, like how we would have started that company, the problem is upstream. It's like credit management, it's like KYC. It's what you're attempting to do when you underwrite, but you don't have the data to do it, right? So like, if you think about a rocket mortgage experience, like you don't fill out a mortgage application and like send them a copy of your W-2 and they call, it's just known, like you use Stripe or something and you connect your bank accounts and like people are vetting us financially in real time. And so the answer is we just get to vetting these entities in real time. Like we have their ELD, we know where they do and do not run trucks. We know their VIN numbers. We know how many different scheduled auto policies they've been on. There are plenty of patterns that can be tracked that lead to fraud. But, and if we would go upstream, we would solve the problem of driver vetting. It would not, because they wouldn't be, the entities wouldn't be able to operate because they wouldn't be able to get business. Does that make sense? Like if you squeeze the bad actors and nobody gives them business, like it naturally takes care of some of this dishonest behavior, but you have to go up above some of those more granular problems. Agree, I couldn't agree more. This is, so when we say this is a supply chain issue, it's so much broader. I will say, I don't wanna discount the question because yes, driver vetting is extremely important. Very, very important. I have clients that have kind of fortified their drive and improved their driver vetting practices. And we've seen cargo theft decreased fairly significantly. Really? Like you wanna know who's picking up the loads. You wanna, they've done driver picture matching to make sure that the drivers, like they know who's picking up the loads. So all of that is absolutely necessary. But I will say that it is, there is such a macro issue here. The macro is really the broader supply chain integration and about collectively working together. So right now there's a Safeguarding Our Supply Chains Act that was presented in the house, right? It has not yet, it hasn't yet passed full Congress and we're waiting, hopefully knocking wood, right? But ultimately that's exactly what it's about. Like this entire issue became so prevalent that now it's in Congress and our government is looking at this and saying, what are we going to do about cargo theft? And the goal of the Safeguarding Our Supply Chains Act is really to have a centralized coordinated effort in combating that. They wanna actually, so the goal is to actually use Department of Homeland Security and the FBI to really coordinate the attack on cargo theft because it's something that has really run away from us. So that shows you that at a macro level, if we can do it at a macro level and push it down, like Michael was saying, we can actually squeeze out some of those bad actors. Because some of this stuff like with like the drug, you're absolutely right. That's so well said, Janelle. I think what I would double down is you're absolutely correct. I just don't think you get as much bang for your buck as you do at a granular level because the driver vetting thing, like there's technologies for that, there's IDV technologies you can implement, third-party libraries like Persona and Clear and if you're a high value shipper, you can do that at the driver level. We have tech that can, like that's not, but again, some of the technology adoption that we would ask people to do can be disruptive and it can be hard to implement and it can be hard to go and get. So I think- Expand on that, Michael, right? Because again, as underwriters, we wanna see that level of engagement investment. What sort of obstacles, what sort of pushback do you get when engaging prospective clients on increasing their tools? I don't get much anymore for our software, but when you start thinking about the interaction with the physical world and you're asking, so I mean, I could do this for days, but a lot of the problem is at the shipper, honestly, right? You have a lot of turnover in the workforce typically that works in a shipping and unloading environment. You typically, the labor at the dock, you have a gate and there's not a lot of sophistication of how those people sign in and out. I mean, sometimes there's like sign-in sheets. There's just not a lot of standards around what it takes to go get a load. I can give a pickup number to somebody and be like, oh man, I think I'm supposed to get that load to St. Louis and you can talk somebody out of a load pretty easy. Like, you really can. But, and so when you think about change management, like if I'm a third-party warehouse provider and I run 200 facilities, well, what's it gonna cost me to go hang up cameras and adopt some technology and what do I get for that, right? Like, is there an incentive? Is there a financial incentive in the short run to help offset some of that cost? Like, is there a carrier? Is there somebody that's willing to help put some skin in the game and say, hey, we believe in this so much that we're gonna put skin in the game rather than like, we're just gonna just take the capacity out of the market and tell you to hope for the best. Like, that's what intermediaries are. Because warehousemen are intermediaries too, right? You run, I ran a warehouse, right? Big multi-client. I've got different kinds of freight moving in and out of a building for different types of clients. I got all kinds of security risks. I have hourly employees looking at pickup numbers and paper bill ratings, right? So for me to solve that problem electronically while I'm buying a tower, while my rates are going up, like, it's just a big financial investment, Jason. Yeah. Right, and then there's the employee change. So my point is we can get there and I say it's easy in terms of like, the technology exists but I think we've got to come to a place where there's a financial incentive. Just like the government will give me money if I put solar panels on my house. I mean, that's a crude analogy but like, we will incentivize people to adopt and do other things in other sectors. I think we got to figure that out. I don't think the government's gonna help. I think we, this group has to figure it out. Absolutely, because you have other coverage lines, ultimately, other insurance practices that do that. Then they do that well. They look at, for instance, property. They'll look at exactly what you have. They'll look at, you know, they'll look at everything. They'll say, okay, do you have sprinkler? Are you sprinkler? Are you unsprinkler? They'll look at everything. That underwriting is a true risk-based premium adjustment on the basis of the protections that you've put in place. So if we can get to that point from an inland marine perspective, specifically for supply chain logistics, I think we would have really done, not only done good for our insurance industry but done really well for the logistics industry because that's what we really want. We want to encourage our clients, right, our collective clients to do better. We want them to adopt real-time tracking. We want them to use predictive analytics. And like Michael said, these things are not inexpensive. So there has to be a way to offset better, you know, helping them improve their risk profile for some of the things that they have to implement. You know, do you think that there's a world where there's like an intersection of risk, true like bespoke underwriting risk-based and like usage-based instead of just like kind of broad spectrum, like I move these type of loads and I do these types of things. And that can be evaluated or do you think we're too far? You think we're far away from that? I don't think we're far away from, well, maybe. And I know that's a really frustrating kind of lawyerly answer. Maybe. It really all depends on how much all of our stakeholders are willing to work together because it's going to require an increased visibility into the underwriting. It's going to require visibility specifically for a 3PL into the loads. It's going to require increased disclosure. So we need to know specifically when you have these cargo thefts, where they are, what happened, what are all the situations, right? The situation surrounding it. So if everyone is willing not only to be fully transparent but also work together to attack this collectively, I think we can get there. Fantastic, fantastic. A couple of other questions that have come in. And this is actually one that we actually had on the previous slide around underwriting perceptions and concerns. In the event of losses that involve technology, right? Is it cyber? Is it cargo? Is it, which policy? Is it a crime policy, right? Do you guys have any, I know there's no one magic answer to that, but is there any sort of perception that you have to share and just based on what you guys have been seeing with the trends lately? This is a challenge. This is one of those things that for our clients has become really challenging because traditionally if I were to, if I were to go and, or if someone were to go and again, smash and grab and steal the cell phone, then it is covered by the cargo policy, right? It's just, it's covered by the cargo policy. It was a theft. So now if I use technology to steal that, are you telling me that that's a cyber event? So the problem is that with our, with the advent of some of these things, like cyber issues and especially the, we have found that there's a lot of, again, back to the demystification around what is actually true theft. So the minute that technology is involved, you can't just look at it and say, oh, it's cyber and it should go in that bucket. That's a problem, right? So cyber is specifically supposed to be for a technologically, a technological event, something that's triggered specifically by technology. It's not supposed to be to cover theft. It's not supposed to be to cover any loss or damage to the cargo, right? But we're finding that because of a cyber exclusion, a lot of our, the cargo theft that might be, might be triggered by technology is being denied. It's being declined. And then we have to go back and try to work through that. So it is a bit of a gray area. We think it's clear, it's theft, theft is theft. So you have to, if I historically were to use a rotary phone to do it, as opposed to a cell phone, does that mean that it's any different? It doesn't, right? So theft is theft and it should be covered, should be covered under the cargo policy. But what I'll say is what I've seen, and I'll say this anecdotally, is I've seen firsthand some clients, really creative ways that carriers find ways to deny claims. And they just keep pointing at different policies. And it's like, well, it's not cyber, it's not. And so one idea that I had, I don't know how feasible this is, but I started talking to Janelle about it a long time ago. Like, can we create a product? Can we create a product? Like, if there's a group of people that do things differently and we have the data, like, can we go out and say, this is an insurable risk and only if these conditions are met by this intermediary that uses this product in this way, they can have access to this risk product. Like, can we go do something that's different that highlights those good actors, right? Can we create something that allows us to look at the underwriting differently that creates a new trend or a new standard, right? So maybe you have these old forms. Maybe you have traditional forms. But maybe we go do something different with 100 intermediaries and we find a different way to look at risk. Or we find a different way to incentivize collective risk management. And so maybe the product doesn't exist, Jason. Like, maybe it's too rigid. Is it cargo? Is it cyber? Is it contingent? Is it all, like, you know, I don't know. I get into this, like, I get really ignorant really fast when it comes to insurance. But I know there's a lot of layers. If I, I sat with a carrier, two of them, from the other side of the pond where all these things get paid and they didn't know how we moved freight here. Like, I explained it in the fragmentation of the market, the way carriers get hired. It was like I was speaking a different language. And so I just think that there's a fundamental misunderstanding of, like, the vectors and exposure points that actually exist on a day-to-day basis. I think there's a real misunderstanding of how prevalent and varied they are on a day-to-day basis. I really do. And I don't think it's any intentional overlook. I think we just kind of got here really quickly. This became, from 1982 post deregulation, think about how fast, like, truckload and the disintermediation of the large carrier happened in the last 40 years. Like, think about how many intermediaries existed in 1990 versus what exists today. I mean, you just, you had this boom of a world that existed and nobody built standards or security. You know, it'd be like building a payment system with no security around it. And this is what we did. We built a physical supply chain and we kept allowing it to grow and get more fragmented. We never put any security in. I mean, it's essentially what we did as an industry. We just kind of kept doing the same thing. Here we are. Yeah, that's a really good point. And I think for our audience on this call, I mean, I think the real opportunity, guys, we have to look at this differently. You know, things are evolving so fast. And, you know, as we talked about the bad actors in aggregate, I mean, they're outsmarting us. You couple that with plaintiff attorneys and it's challenging out there, right? So the burden is really on us to make sure that we're developing products and capturing data in a manner that's gonna allow us to have a fresh perspective on what's going on and maybe recognizing some of the things that are in place. So it could be a little outdated just depending on what your shop is offering now. Some of the comments I'm seeing in the chat room here, and it looks like, again, coverage wording, right? Making sure, you know, I know a lot of us use AIS. Some may use proprietary forms when it comes to motor truck cargo, but looking at the wording and making sure that we try to get rid of gray areas. And I know that can be a slippery slope, Michael, from your perspective, right? Because ultimately you're trying to find coverage for your client, but at the same time, you know, we obviously are looking to turn a profit based on our underwriting portfolio. So that's just a dance that's gonna constantly happen and again, that's the real opportunity. Another one I see here is what specific advice should we be giving shippers for first party cargo insurance coverage to help prevent theft, just straight out? Any thoughts on that? Yeah, I think shippers, I don't know if it's an advice thing and Janelle may have more targeted advice than me, but I think it's a bit of a cultural thing with shippers. Right, there is a certain amount of, we want to tell either the motor carrier, the intermediary to do all of these things and we want to be able to completely assume that whoever's showing up is the person. And look, one of the easiest things that I've said is if a trailer shows up and the bolts that hold the lock on or the bolt seal on are facing the wrong direction, the only reason that a trailer would be fabricated that way is for the purpose of theft or pilferage and they get loaded every day. Trailer will show up and if you look at where either the doors are or where the hinge is, the bolts are facing out, which means that carrier had their dealer do that after it left the manufacturer. The only reason you would spin the bolts that way is to rail a load or pilfer it. If you're gonna steal it, you don't care, but if you're gonna rail it or you're gonna pilfer it, you need to remove that mechanism and then put the bolt seal back on intact so that they can sign the bills clean, seal intact. And so like the easiest thing a shipper can do to stop pilferage is don't load trailers that look like that and they load them every day. Everywhere I speak, I take pictures with me, Scott Cornell takes pictures and we still see trailers going up and down the road with bolts facing that way. All you have to do is turn them away. Just don't let them in the gate. It's the easiest thing a shipper can do that is still a problem today. That's just like one thing. And so I think what I would say if there's a voice to the shipper audience, I can run a whole bunch of software, but I'm not there. The shipper needs to do what only they can do by being physically present. Does that make sense? And that's where I think it falls down. I think that's where things begin coming apart. Because think about the urgency thing again, right? I just need to get as many trucks out of here as I can. And so it's in that urgency and bad actors know this. They've been doing this for years. They know how to talk their way into facilities. They know how to talk their way into loads. Like they know who's there. They get to know people. They know how to talk their way in and out of things. And so I would say, look at the physical equipment, right? Like I can provide ways for you to look at VIN numbers, look at the physical equipment and take care about who's actually showing up to pick up that load. Jenna, I don't know what you're telling shippers, from an interest perspective, but that's kind of the things that we see where we're like, I wish I could be there because I can't fix that if I'm not physically there. Yeah, so this is exactly what we were talking about earlier from a broader perspective, it's education. And as an underwriter, you can assist that. You can partner with risk mitigation consulting firms. You can consult with, you can have your own risk engineers provide best practices. You can provide education for the first party cargo interest for those shippers so that they understand how to improve their technology. Like Michael was saying, the bolts, that's a very rudimentary thing. It's really easy to spot, but if you don't know, you don't know, right? You don't know what you don't know. And so if you wanna help, right, you can help partner with firms that will provide or your own risk engineers that will provide that level of education. You can also, like we were talking about before, that risk-based premium adjustments, right, or incentives, those sorts of things will then encourage first party and third party entities to then seek out their own. Maybe they can now increase some of their security protocols. A lot of them do this already, but I think asking the question and helping them understand where their security is failing and or where it's helping is really important. I honestly think it's about having the conversation surrounding this, not just being reactive. We wanna be a lot more proactive. We're at the place now where we are only reactive, unfortunately. I would say another thing too, if you have a voice with shippers, and Highway, we actually don't commercialize a shipper product for this reason. We sell to freight brokers, and so we look to partner with shippers and we look to partner with folks like Janelle to create programs that ultimately create conversations that ultimately can help benefit freight brokers and help freight brokers serve the shipper community and the carrier community better. That's just where Highway sits in the marketplace. One of the things that I've noticed with shippers, and I think just collectively there's just a lack of conversation, there's a lot of intermediaries, large ones that are willing to help. They're willing to help offset device costs for things like Tive. There are things that, Jason, you talked about interdiction or getting recovery. We're actually seeing our customers recover things really quickly. Because if there is a loss event, typically, if they're working with us or they're working with CargoNet, there's enough data for them to get to that cargo recovery a lot quicker, or at least take it from a theft to a hostage event. Where there's still some exposure, maybe they find a way that they can recover the cargo. So the actual physical loss is different. But Janelle and I run into each other on these little, there's like this little kind of subculture conference circuit of risk conferences. And it's 90% intermediaries, and a lot of shippers there. So I would say from my perspective, I've got approaching 1,000 customers that are incredibly interested in solving this problem. And I get maybe a couple phone calls a week from shippers like you could just get in the conversation. Hey look and actually we just got a comment in the chat room it just says act asking shippers to act more is great and all but that's perfect world shippers will not act until liability is pushed back on to them. Thank you yes absolutely so how do they how do you get a shipper to have skin in the game yeah like how do you that would be my question for the industry right there's a whole bunch of underwriters maybe we can just get a whole chat going to be like AOL chat rooms if you all remember that but like how do you get like how do you get how do you create a world where if the broker and the carrier do everything right and there's a loss event that that claim can be subrogated how do you create that world sure sure hey another good question that came up it says is it possible to control use of and access to public load boards it seems that this would be a great way to start the process of controlling the fraud exposures and I know we're getting into cyber potentially there right uh any thoughts to share that's a challenge that's a challenge I I know so I was gonna say I know you're I know you definitely are this is a good one for you too Michael I can tell you that a lot of our clients are we have this conversation all the time uh load boards aren't necessarily the best and or safest right and so the problem is that there are times if we're looking at things like driver shortages and we're looking at constrained um you know constrained margins a lot of times the the load board are the easiest place for for some of the clients to go not necessarily the best and so again it goes back to having those conversations and there has to be everybody has to have skin in the game so as a as an underwriter you might want to look at that and say well you know how many times do you do times do you engage a load board when you talk to Jason about you know increasing your questions on an app and updating those apps we have to update it with what's happening today it can't be what we're you know we don't even ask about really ask about load boards when it comes to an uh comes to underwriting yeah right if you stop using them the risk will decrease yeah so I think I think what I would say generally without being very specific is um yeah yeah absolutely like I mean we we have a patent on an identity engine like we are the motor care identity provider in the industry but the only ones and any load board could adopt that and safeguard their system if they wanted to and so what I would what I would just say generally speaking is that when we think about any kind of technology and we want any kind of provider to do anything we have to just be thoughtful about what we're asking them to do and where the incentive alignment lies right so for years right the the whole incentive of any kind of marketplace like that was to maximize users right anybody that's ever been involved in any kind of commerce or web traffic knows that like monthly active users daily active users that is the name of the game right so when you're acting when you're asking a load board to stop fraud you're asking them to turn off 20 percent of their customer base like that's just what you're asking to do and the reality is fraud exists because of load boards I can say that as a load board user I used to have I had t-shirts made in one brokerage that said get off the load board like like the whole idea around an intermediary is to curate capacity in the long tail not to put freight on craigslist right and so and so that's absolutely a question but I don't think that's the right place to pick the fight the load boards have their place but but if they were to solve the problem you'd be telling them to turn 20 of their customers off that's what you'd be telling them to do and so you just I think I just think we have to be thoughtful about incentive alignment like how you're going to ask them to do that they're owned by private equity or they're owned by the public and you have to have users yeah and that that's definitely the uh the the crust of the challenges that we're facing industry wide um uh we did have a couple of case study discussions that you guys uh as we uh being mindful of time I think would be a good way for us to transition really good conversation here guys but uh I'll turn this over to uh to you all to maybe use just some some case studies to kind of talk about and flush out some more topics here that we've covered yeah so so I think these are just really examples of how using technology has been beneficial to to clients right and so in providing these case studies we really they're really just food for thought the fact that technology can actually be used to mitigate this step and then from an underwriting perspective if you're asking the right questions and you're realizing that the trend specifically for the clients is is decreasing then hopefully they can they can be rewarded and start to bolster that so you know a company a soft f trend specifically aimed at their electronic shipments so as a result they adopted iot and gps enabled sensors for their high value electronic shipments I can tell you that that specific client because of the implementation that resulted in 40 percent reduction in their thefts not only that there was also a faster recovery of their stolen goods because they had real-time tracking 40 percent and that just goes to show you that just enabling those two things ultimately had a significant result company b they couldn't exactly figure out where why or how their shipments were being stolen well they knew the where but they didn't know the why the how they were being stolen and they really didn't see a trend outside of an upward trajectory on the increase of stolen goods so what they did is they started to streamline their verification processes which we talked about that driver verification not only that they're looking at the bills of lading making sure really looking at making sure that the bills of lading trying to figure out if they were fraudulent there were so many things that they did to really streamline their verification processes they also implemented blockchain technology for better transparency and ultimately what happened there is that they actually had close to a 50 percent reduction in in cargo theft now this took them about a year and a half they had about close to about a 50 percent reduction so you know for us most of the key takeaways are that we really want to encourage our policy holders and our insurers to start to implement some of this technology if they're not already doing it we want to it's our job really as an insurance industry to start to promote better risk management right we don't want to just write insurance we want to promote better better risk management and part of promoting better risk management is again helping to helping to provide transparency into what we're what we're doing and some of those underwriting practices also helping to educate our clients but also let's use technology in a way that we can start to come combat the ways that bad actors are using technology i don't have a case study but it's interesting like everything you point to janelle really is about getting closer to the load the actual specific load this is something i've talked about right so you know cards on the table we don't have a lot of case studies we've been operating just under two and a half years but we we have a product called load lock that takes all of our compliance measures and takes them to the load we really look at three things the cargo the origin destination pair and the motor carrier we look at that in real time we look at movement we look at a lot of things we're about 70 brokers that adopted that about 16 that are really big and over a period of time in that particular product we've looked at five million loads and on those five million loads there wasn't one incident of strategic cargo theft so so the point is if you can get visibility and visibility is not track and trace it is not a blue dot on a map okay it's not what we've been told it is you can get true visibility into the capability of a carrier like like a lot of like janelle said a lot of what we do is contingent so like if you have to engage in that contingent policy like is that carrier going to be there do they have the right coverages do they have exclusions buried somewhere in their policy where is that movement the closer you can get to the load level and the more you can automate that function and move an intermediary into exception management instead of having to look at every incident that's the thing right think about finance and accounting and everything else we manage exceptions right we look at anomalies we look at outliers and so the more you can get into coverage at the load level now you're just managing exceptions and it's easier you move from noise to signal and that's what we're trying to get people to away from noise because bad actors love noise because they can hide right they can do things we're trying to get our customers away from noise and and trying to deliver signal right that allows you at least if something bad is going to happen we'll get you really close to an intervention point because bad things are going to happen but if we can get really close to intervention like we we turn losses way down and we catch bad guys fantastic fantastic we actually had a couple of uh questions uh that might have come in i think this is a a good one uh uh one member of the the call here says that they've been witnessing tariff dodgers that are importing goods into long beach where the bill of lading ends up in mexico and they're then unpacked and repacked and brought into the u.s through mexico domestically is there anything that we can do as underwriters to nullify coverage of fraudulent activity has taken place other than excluded and that may be tough to sell as a product so in that scenario janelle who's dodging the tariff i got i'm not sure i completely understand like who would be right i was gonna ask yeah the question specifically references uh the port of long beach and so i'd imagine it could be an asian shipper maybe they're they're unloading stuff unethically illegally and trying to get it through in an effort to try to dodge some sort of tariff i don't know if that's anything that you've seen but uh it's it's something that's pretty pretty creative to say the least that sounds like so the forwarding world the freight broker world is fragmented the forwarding world's even worse like there's there's hundreds and hundreds and hundreds um especially in port cities of small forwarders and small carriers like when you start getting into the forwarding and the the first mile intermodal world things get really shady really quickly i don't know how to help we don't have product for that but what i can say is like there's a lot there's a it's that that paper trail is really hard jason sure when you start getting into international paperwork and where things come in and you get forwarders involved and they're passing things between dray carriers and there's containers like it gets very um it gets very gray very quickly you know i don't know if y'all are seeing that from a claim side or how you think about that but that's this is a very hard problem to solve that's a difficult one but honestly i'm intrigued by hard hard problems i i love that and while i don't have an answer it's definitely something i'm gonna dig into because i haven't really seen that but i do i will dig into that a bit more and i agree with you michael that when it comes to mostly from a forwarding perspective and you're looking at multiple potential conveyances it becomes so much harder from a visibility perspective if it's really if it's truly not sitting with one forwarder who's tracking it from point a to point z let's say it makes it so hard because you're passing it's passing so many hands so forwarding becomes a lot a lot more it's a lot more challenging if you don't have the right forwarder but i don't have a specific answer to that is what i can say but i will dig into it fantastic you know guys as we get ready to to close our time out here what i did want to ask is that there's if there's any other questions that any of the uh the members of the call our audience has to ask i mean that was a great time as we get ready to wrap i really want to emphasize guys that when we put this time together and big shout out to the transportation committee um as this was a topic that was socialized there's a lot of questions around it and uh really excited to have our our panelists on board to try to help us just get our arms around our minds around what's in the future right again as janelle mentioned earlier so much of what we're doing is reactive it's not proactive but is there any sort of closing comments as we'll aggregate any final questions uh janelle michael that you guys may have just in terms of actionable items that we need to take collectively our agents our underwriters the greater insurance committee uh community obviously our insureds uh is there any sort of takeaways janelle i'll start with you yeah so i think from a takeaway perspective we talked about a lot of things high level i think greater communication greater transparency more bespoke underwriting all of those are for me key takeaways and things that we can do to help mitigate this issue but for when i think about probably some of the greatest things that we can do to help mitigate this cargo theft even if it's even if you're asking the right questions it's really about how you're looking at the technology how you're looking at the data that you know the questions that you're that you're the answers to the questions that you're asking so even if it's from an insurer perspective investing in greater technology investing in in technology that helps you with better transparency and understanding specifically with each one of those evolving logistics entities do and understanding their true risk really does go a long way to helping to mitigate some of this uh these cargo theft yeah i think um i think my parting comments would be the reason that we wanted to do this is i hope that this is the beginning of an expanded conversation right and so we've got a lot of data and we we we serve the largest freight brokers in this capacity and and i talked to a uh a retail broker a week couple of them i talked to an mga a week i mean everyone wants to solve this problem and everyone's really curious as to if there's different ways to do it and i think what i would say as a part in common is all of the things that we have done don't work or we wouldn't be here and so we've probably got to work together to figure out some new ways and you know i'm i'm going to leave this call and go to a board meeting in eight minutes and we're going to talk about like should we be thinking about how to serve underwriters right should we be thinking about how we we do things that help bring the conversation together between our customers and their broker or their underwriter right like like we're we want to help solve this problem like our loyalties to our customer base but if there's a way that we can help underwriters better work with freight brokers right and if there's a way that we can help you guys go you guys don't want to sell stuff right you underwriters like you're helping people sell things right can we bring capacity in the market can we do things to commercialize this stuff where where we quit talking about losing money we start talking about making money right like there's got to be a way to do that there's got to be a way to innovate in the midst of a problem there's got to be a way to bring things to market that are helpful and so this isn't just about like hey let's all throw shade and talk about whose fault it is i want to help like i would love there to be different things that serve my customer base and i would love to be a part of that so if there's a like a practical way like i don't know if there's a you'll have a follow-up summit somewhere but i really think it's it's a it's a there's multiple parties that have to continue to have conversations because this is all like state regulated like i thought this was going to be easy man it is hard like when i first started talking to janelle about this it's like we just do this and she's like no that's not how it works um so i i think it's i think it's going to take a collective effort to to make to make this happen because this is you know the insurance is a slow-moving industry but i think we can move it right if we if we if we work together yeah no absolutely a two questions that really came in and and thank you for that michael and janelle was spot on maybe uh just some brief comments michael you had mentioned earlier in the presentation around you know multiple dot numbers potentially what that looks like for us is multiple named insurance additional insurance depending on what lines of business we're underwriting how do we get around that how do we navigate that any thoughts uh for us at the underwriting desk yeah i mean i'm going to go back to like this is probably an expanding conversation where we should look and say hey like we're really going at the identity level who's the motor carrier what do they represent what's associated with them and so i think there should be a conversation around like what exposure does the underwriting community have a desire to do that right because it's not it's not a one-to-one ratio there's carriers that share eld accounts i mean i don't trust anybody anymore fraud's really bad like i don't trust anybody um like and so you've got to have an identity provider that does this i mean that's the only answer and there's only one so that's me sorry but like that's just where it is it's like you wouldn't sign into you know your financial account if they didn't have an identity engine protecting you and so it's it's the metadata behind your identity that proves who you are and you've got to enter you've got to work with somebody that can tell you the truth about an entity and who they are and what they do because they're going to lie on a form no fantastic uh one other question that just came through uh insurable is is obviously a couple of different fundamental ways of thinking about insurance but is there anything that's uninsurable uh when it comes to commodities that you guys might have seen or versus what is uh i guess that's the best way to paraphrase that you know i have a different answer than me i haven't seen as much uninsurable as much as i've just seen exclusions you know i'm saying when you're dealing with contingent coverage and you knowingly load some knowingly load someone with an exclusion it can be problematic and so i think as an industry like we've got to do better about exposing there's exposure that that lives in hiring a motor carrier that has an exclusion right and and so i think we've got to we got to move like what can it what can you buy insurance for okay if i know it's excluded or if i know it's a particular type of commodity like i should be able to go buy a shipper's interest policy for that load like like that i think that's the bigger issue it's not about like what's uninsurable it's about how do i go insure it i just need to know yeah janelle did you have any thoughts uh i can tell you i've had this conversation i don't know that in our world that there's anything that you should really look at and say it's uninsurable i feel like at the end of the day this is you know our clients need the insurance they need to be able to transfer risk but the reality is that there's a cost to that as well so i don't i generally don't like to hear that certain things are either uninsurable um i'd rather have you price for it so so really i can't really i can't say that you guys are the insurers so you were that you'd be the ones to tell me whether or not you deem something uninsurable we're not dealing with illegal activity we're not dealing with things like you know intentional acts or intentional misconduct that we're asking you to insure i think that when it comes to a commodity from a commodity perspective it shouldn't really be uninsurable it's just a matter of what you're going to price how you're going to price it 100 percent no yeah spoken like a true broker janelle i i get it i can dig it and i'm the first thing i want to move everything yeah we'll we got we got a lot of time we got a lot to move everything yeah we'll we'll buy some measures so that will move it it's fine no absolutely and listen i think this is a great one for us to close on it just says uh given what we're at in the world uh specific to cargo theft what one thing can we recommend our brokers do better to stop these fraudulent exposures i'm going to actually take the lead on this one and they'll defer to you guys but we need better submissions out of our retail agents and wholesale agents depending on where you're at in the chain data information and i know as underwriters that may be able to start at the supplemental application standpoint depending where you are maybe it's been five years since you've looked at your supplemental apps maybe it's been two but all the same we want to make sure that we're asking the pointed questions as well as leveraging loss control and uh in contracts where applicable to try to mitigate loss uh but what's that silver bullet uh janelle michael as we walk out the door here i don't have a silver bullet i'm gonna adjourn my part like 60 seconds early um i'm so sorry i'm gonna give it back to you guys i've really enjoyed this i don't think there's a silver bullet what i'm gonna continue to say is we need to move upstream of the micro issues we need to deal with the macro level issues we need data and we need to think about like identity and transparency anything that we can do to get rid of the anonymity right all of the obfuscation that's taking place around who's doing what how they're doing it right i don't think there's a silver bullet but i do think that there is enough data that lives in silos that if we un-silo that and we put it together we can find patterns we can get predictive about particularly in terms of cargo theft right like safety and liability that's probably a different webinar and i don't want to be on it but as it relates to protecting cargo right and and and thievery we can solve this problem but there is no magic bullet and there is no one person perfect i i don't have very much to add beyond what michael said to be honest we we love our insurer partners we really do work closely with our insurer partner insurer partners and we try to create you know product and solutions on behalf of our clients but it's that it's exactly what you said it's about the visibility so we will pull in we'll pull in technology providers and we will figure out how to best help you gain the visibility that you need so it's really about having the conversations and partnering to make sure that you have what you need at the submission level to make sure that you're underwriting it from a bespoke perspective if that's something we can help to provide then we're happy to do it if it's something that you know we can provide insight for you so that you can go back to your powers that be and say we need x we need y we need z then we're happy to do that too but it's about having the conversation and really partnering together to tackle this fantastic i appreciate it and guys again there's no magic bullet here we just wanted to open this up for conversation i really hope that you guys found it valuable uh i do know that we're giving out an amazon card i saw a sierra nolan's big shout out to you you were very active we appreciate your participation and uh and good luck and eileen yeah i will turn it over wonderful thank you uh janelle jason and michael you were all fantastic a lot of great information also a lot of uh wonderful engagement so kira nolan is is your official winner and well deserved um that's fantastic um we will send you the 25 dollar amazon gift card kira um thank you also to our attendees i did pop a survey link and you'll also get an email with the follow-up survey so look forward to what works what what else uh other education that we can offer that would provide value and um hopefully we will see you then next month at the next webinar and once again thank you both wonderful thanks guys bye

Inland Marine Underwriters Association

webinar

cargo theft

cybercriminals

logistics

technology investment

risk transfer

motor truck cargo policies

cyber exclusions

tracking and verification

industry collaboration

risk assessment

underwriting practices