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The Trucking Dilemma

2019 has been a challenging year for truck drivers and their employers.  According to Broughton Capital LLC, a transportation data company, recent reports indicate that close to 650 trucking fleets shut down in the first half of the year, compared with 175 closings during the first six months of 2018.   This ranges from small fleets to even some of the larger fleets in the country.  So, what does this mean for the future of the trucking industry?

CEO of Roadmaster Group, John Wilbur, hates to see companies shut their doors and jobs being lost, just as any of us do.  However, being the straight shooter that he is, Wilbur did not hold back when expressing his thoughts and concerns, and even shed some light on many current issues in the trucking industry.  In a recent interview with Fleet Owner, Wilbur expressed these thoughts and concerns and how the recent closures throughout 2019 will affect the future.

“I need to be careful, but I see it as healthy,” he said. “We just don’t have enough barrier entry to this industry at the general freight level, and there’s too much capacity at times. So I find it’s a cleansing process. I mean, you hate to see anyone go out of business and people lose their jobs. Some companies are in the market when they shouldn’t be, then they tend to mess up, get desperate with pricing, and it messes up the market until they go away. So, it’s just a natural part of the industry cycle and how we get healthy again.”

While these reports have resulted in fear of the industry’s downfall, Wilbur believes these rumblings to be blown out of proportion.

“2019 would feel a lot better if it wasn’t for 2018,” he said. “2018 was such a barn burner of a year for the entire industry, and everybody has short memories. But if you could theoretically remove 2018 and stack 2019 up against 2017, ‘16, ’15 and ’14, it looks pretty good. So I would start from that perspective.”

So, if we start looking at things from a different perspective, what exactly does that mean for the future?

“I look at 2020 as a little bit more of the same pace that we’re seeing here in 2019. I think the good news from a trucking standpoint is that capacity might tighten up a little bit, which then manifests itself in pricing. If you really look at the industry structure, it doesn’t have a lot of barriers to entry.”

With low barrier entries, comes more issues when weaker players get into the market and stay in longer than they should.  And, unfortunately, that is exactly what we are seeing today and may see more of in the future, in terms of weaker players being pushed out of the market. 

“I look at 2020 from the macro view, and say load volume will probably be flat to up a bit, and capacity may tighten a little bit, so you may have some price support.”

With companies entering and dropping out of the market comes job loss.   This brings up an issue regarding what is said to be one of the biggest in the trucking industry: the driver dilemma.  Wilbur has a different view of the driver shortage, being that he doesn’t particularly see one.  He does, however, agree with the idea that drivers must be compensated while they are on the job, regardless of what problems arise while getting routes completed. 

“This industry has always used the mileage pay as a way to shift the risk to the driver,” he noted. “The risk of freight, the risk of weather, the risk of traffic. But that driver’s in the truck in the middle of Kansas ready to work, so why is it on him? Our drivers don’t get penalized for that. It’s been the biggest single thing we’ve done with our company that’s allowed us to grow so fast. “

This brings up an interesting argument that the focus shouldn’t be on the driver shortage, but in fact the driver retention. 

“If you can take that 90% (turnover) down to under 50%, which is where we operate, then it’s a lot easier animal to manage. But you have to question everything you do and take some risks. Because clearly what the industry is doing today isn’t working.”

In closing, it is necessary for all of us in the trucking industry to live in tomorrow.  We must always be thinking one step ahead and in trucking, that might mean a month or even a year into the future.  As the trucking industry moves into 2020, we must be ready to take steps in staying informed and ahead of the game.  And, at Precision Insurance and Finance, it is our goal to do exactly that.  With 2020 quickly approaching, it is our mission to keep our customers informed and safe on the road, so that we can keep this country moving!

 

Source:

Catarevas, Michael. “Roadmaster CEO: Fleet shutdowns ‘cleanse’ the trucking industry.” American            Trucker,  Informa USA, 4 December 2019, www.trucker.com

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Happy Thanksgiving!

Thanksgiving is one of the most celebrated American holidays and one of the few times a year friends and family come together to share a meal.   Like many other great things in this country, this holiday would not be possible without the help of our commercial truck drivers. 

It is the truck industry that we have to thank to deliver all the supplies to make that special Thanksgiving meal possible.  According to the National Turkey Federation, approximately 51 million turkeys are eaten over Thanksgiving every year.  While many of us simply go to the store and pick up a turkey, that luxury would not be possible without the 16,600 truckloads that deliver those turkeys across the United States.  And we must not forget about all the goods that must be delivered to ensure we have all the sides to complete our Thanksgiving feast. 

We must remember to give thanks to truck drivers for keeping our tables filled this holiday.  So, from all of us at Precision Insurance & Finance, we’d like to thank you for helping make Thanksgiving the special day it is! Have a great holiday and drive safe!

‚ÄčOur office will be closed Thursday, November 28th and Friday, November 29th in observance of Thanksgiving. Our regular hours of operation will resume Monday, December 2, 2019.


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Honoring All Who Served!

With the start of November comes Veteran’s Day- the one day a year where we celebrate the bravery and sacrifices of all U.S. veterans.  As wars end, life continues on and many of our veterans have found work in the commercial trucking industry.  In fact, 10% of veterans are employed in transportation and material moving occupations. Throughout this month, we would like to recognize these hard-working individuals for their commitment to our country and one the economy’s most important and demanding jobs.   

On behalf of all of us at Precision Insurance and Financial Services, we would like to extend a sincere thank you to America's Veterans, especially those on the road today.  At Precision Insurance and Financial Services, it is our mission to protect and maximize your assets and make your job easier, while you are on the road, just as you have done for us through your service. 

Thank you for your courage, dedication, and hard work.  Because of you, this country keeps moving!

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It is no secret that the roads are more dangerous than ever.  With smart phones and other distractions, the highways have become more accident prone and unfortunately for commercial truck drivers, the public opinion has shifted the blame towards them.  

Earlier this year, Verizon Connect conducted a survey by Wakefield Research in hopes to find an insight onto how the general public views commercial truck drivers.  The survey included 1,000 adults, who were asked a variation of questions regarding road safety.  While only 3% of all severe crashes in the US involve commercial vehicles, the survey found that 83% of drivers of passenger vehicles believed they posed less of a risk than truck drivers.  Unfortunately, that was not the only skewed result found throughout the survey.  Although only 70% of truck involved fatal crashes take place on roads other than the interstate, the majority believed more accidents occurred on interstate highways. 

While these results are subjective, the reasoning behind the misconceptions were said to have been formed by past experiences of the respondents.  So, what does that mean for truck drivers and our safety on the roads?  With these findings, Verizon Connect has incorporated many of these issues within their integrated video system in hopes to help fleet managers improve safety.  The new system features “speed overlay,” allowing fleets to view the speed of the vehicle directly within the video clip.

 

“Smart video monitoring and other emerging artificial intelligence and IoT technologies are helping commercial drivers stay safe on the road and protect themselves in the event of any incident,” aid Kevin Aries, head of global product success at Verizon Connect. (Abt, 2019)

With these new advancements, we will be able to collect new data on commercial truck drivers, creating a safer place on the road for both truck drivers and drivers of passenger vehicles.

  

 

Source:

Abt, N. (2019, October). Survey Shows Public’s Skewed View of Commerical Drivers. Retrieved from https://www.trucker.com

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Happy Labor Day!
Our office will be closed Monday, September 2nd in observance of Labor Day. Our regular hours of operation will resume Tuesday, September 3, 2019.

We would like to wish everyone a safe and happy Labor Day. 

Sincerely,
 

Precision Insurance & Financial Services, Inc.
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Welcome to the Team Reed

Reed F. Gilmore has joined Precision Insurance & Financial Services, Inc as manager and producer of our western region office in Jackson, Wyoming.  Mr. Gilmore, a transportation insurance specialist, brings years of experience in underwriting and managing portfolios of trucking and transportation clients.  He will concentrate his efforts on expanding our growing client portfolio in the western United States and will supervise our premium finance operation.  Reed is a graduate of the University of Mississippi.  He and his wife currently reside in Fort Collins, Colorado. 

 Welcome to the team, Reed!

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Sunday kicked off National Truck Driver Appreciation Week - a week-long celebration honoring the 3.5 million professional truck drivers in the U.S.  As transportation professionals, we recognize how much these hard-working individuals do, but most consumers are not aware.  Here are some things you may not know about our nation's professional truck drivers. 

  • The trucking industry is an essential driver of our econmy, contributing $738.9 billion in revenue a year.
  • There are 3.5 million truck drivers in the United States.  The total trucking industry employment is 7.3 million.
  • These men and women move more than 10 billion tons of freight each year.
  • Through their dedication and endless hours, truck drivers travel over 4.5 billion collective miles a year, making sure that the things we often take for granted are readily available.
  • In the U.S., 90 percent of communities rely exclusively on truck drivers for their every-day goods and necessities.

During this week-long celebration, we would like to recognize these hard-working individuals for their commitment to one of the economy's most important and demanding jobs.  On behalf of all of us at Precision Insurance and Financial Services, we would like to extend a sincere thank you to America's truck drivers.

While you are working around the clock, we are dedicated to assisting you along the way.  At Precision Insurance and Financial Services, it is our mission to protect and maximize your assets and make your job easier, while you are on the road.  

 Thank you for keeping this country moving! 

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Fall is a time for football, falling leaves, apple cider, hay rides, and the CVSA’s Operation Safe Drive Week. There will be educational outreach events throughout the week. Law enforcement officials across North America will be out in full force with their magnifying glasses on commercial motor vehicle drivers and passenger-vehicle drivers looking for unsafe driving behaviors.

CVSA Operation Safe Driver week will be held October 15-21, 2017. Throughout the week law enforcement officials will identify and issue warnings and/or citations to drivers they see exhibiting unsafe driving behaviors. Dangerous driving behaviors that they will be looking for include, but are not limited to: speeding, texting, not wearing seat belts, traveling too closely, improper lane changes, failure to obey traffic control devices, and distracted driving.

The goal of the program is to “reduce the number of crashes, deaths and injuries involving large trucks, buses and passenger vehicles due to unsafe driving behaviors.” Unsafe driving behaviors are the leading cause of crashes. Keep crash, injury, death, and your insurance rates down by keeping your head up and eyes on the road! 

 
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            At Precision, we want you to understand more about your insurance costs. Tickets and points on your license are not the only things insurance companies take into consideration.  Insurance companies take many factors into account when determining the price of your insurance quote. One of these factors is your safety rating (DOT score) determined by the Federal Motor Carrier Safety Administration(FMCSA).

            Carriers are given ratings of satisfactory, conditional, or unsatisfactory for multiple compliance areas. These areas include: Unsafe Driving, Crash Indicator, Hours-of-Service Compliance, Vehicle Maintenance, Controlled Substances/Alcohol, Hazardous Materials Compliance, and Driver Fitness.

When your drivers and vehicles go through an inspection, it is noted each time they are placed “out of service”. For example, if your brakes are still in use past the time they need to be replaced, it is noted in the “Vehicle” area on your DOT rating. If your “out of service %” in any category is 80% or above, the DOT places an “alert” on your company. These percentages are determined according to the number of inspections you have had and the number of times out of service. Some insurance companies have a policy not to cover carriers with 2 or more alerts.  Other companies will take the risk, but quote high rates. This means you could have clean drivers, but still have high rates due to bad inspection outcomes. 

Making efforts to improve a bad safety rating or maintain a good one can do remarkable things for your business. When you keep your equipment up to date, comply with hours-of-service, driver safety, and basic laws of the road, your company will be a well-oiled machine (pun intended). In the process, you will reduce accidents and improve your safety score, which in turn, will bring down the price of your insurance! It’s a win-win for everyone!

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We would like to announce our acquisition of Concord Commercial Insurance Agency, Inc. in Punta Gorda, Florida.Concord Commercial is a leading transportation insurance agency and broker in the Southeastern United States. Concord Commercial's staff not only has experience in writing transportation insurance, they have experience in managing transportation companies.

Their unique experience, customer service reputation, and leadership in the Southeast market is what attracted Precision to them. Concord Commercial currently writes business in Florida, Georgia, South Carolina, North Carolina, Virginia, and Texas. Their market area is expected to grow over the next several months as they add new customers to their already diversified and growing book of business.

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