On March 1, 2016, WRAL Investigates reported that North Carolina Insurance Commissioner, Wayne Goodwin, is pressing state lawmakers to tighten regulations over commercial vehicle insurance. His reason being, out-of-state trucking companies claiming in-state residency to obtain North Carolina’s lower insurance rates.
In fact, NC boasts some of the lowest vehicle insurance rates in the country— causing problems in the past. According to WRAL, ten years ago, passenger vehicle drivers from New York and New Jersey were registering their cars in NC to obtain cheaper car insurance. Eventually, the General Assembly adapted the law and thought they had put an end to the problem.
However, the same problem is now plaguing the $670 million-a-year commercial vehicle insurance market. To illustrate, the North Carolina Reinsurance Facility has raised its commercial rates in recent years sighting significant claims losses for the increase.
In the WRAL report, Goodwin was quoted saying, “They [out-of-state trucking companies claiming in-state residency] have accidents in other states and the like. It impacts insurance rates for the legitimate businesses that are here, and it’s becoming a growing problem.”
Goodwin’s office is drafting legislation to present to the General Assembly in April. He hopes their ruling mirrors that of 10 years ago, and the Assembly bans commercial vehicle firms from claiming false residency in NC.
5 Factors Impacting Your Trucking Insurance Premium
While commercial vehicle insurance rates do vary from state-to-state, there are other factors that also impact your trucking insurance premium. Here are what we consider to be the Top 5:
If your company has a history of high claims rates, odds are your trucking insurance premium will be more expensive. Insurance companies are more willing to provide lower premiums to companies whose safety and compliance initiatives are effective in preventing accidents.
Driving records of company drivers
Not only do insurance companies look at the claims records of the overall trucking company, they also look into individual drivers. A company whose drivers have several violations may have high trucking insurance premiums, or even find it difficult to get certain insurance coverages.
Value of vehicles
Is it best to buy a new or used truck? Honestly, it depends. A new truck will require higher initial coverage due to its steep price tag. However, a used truck could also potentially need more coverage in order to ensure you’re protected in the case of a breakdown.
Structure of your policy
If you choose to purchase your insurance policies separately, such as by price shopping the different coverages through various insurance companies, odds are you’re actually going to end up spending more. As with Home and Auto insurance, it is best to bundle your commercial insurance.
It easy: The further you travel, the higher the chance you’ll get in a wreck. Therefore, a company that provides service nationwide will have a higher trucking insurance premium than a regional provider.
Over the course of a year, many things can change within a trucking business—driver turnover, lower claims rate, etc. That’s why it’s always wise to ask for an annual review of your insurance portfolio.
If you believe your insurance rates are not as low as they could be, contact Truck Writers today for a free quote.