When the average person considers auto insurance, they’re likely thinking about personal car insurance. But what about commercial auto insurance? Late last year we were struck by an opinion offered by Insurance Business America: “Commercial auto is widely regarded as one of the most challenging insurance markets in the United States.” In response, the John Bailey Company determined that 2019 may be a good time to assist business owners and key personnel in better understanding commercial auto insurance. Our goal today is to present a commercial auto insurance telematics and ELD primer.
Federal Motor Carrier Safety Administration
If you travel any United States highway, you’re bound to see a road sign or a truck displaying the symbol for the U.S. Department of Transportation (DOT). Established in 1966, the DOT’s mission is: “Serve the United States by ensuring a fast, safe, efficient, accessible and convenient transportation system that meets our vital national interests and enhances the quality of life of the American people, today and into the future.”
Fast forward to January 1, 2000, and the Federal Motor Carrier Safety Administration (FMCSA) was created as part of the DOT, with a primary mission “…to reduce crashes, injuries and fatalities involving large trucks and buses.”
In 2012, Congress passed the Moving Ahead for Progress in the 21st Century Act (MAP-21). Tucked away in Section 32301(b) of the Commercial Motor Vehicle Safety Enhancement Act, enacted as part of MAP-21, (Pub. L. 112-141, 126 Stat. 405, 786-788, July 6, 2012), the ELD rule is mandated.
Electronic Logging Device (ELD) Rule
Do you have a few hours to spare? If so, you can read the 126 page Electronic Logging Device Final Rule. But first, let’s get a better understanding of ELDs. The precursor of ELDs (electronic logging devices) were paper records of duty status (RODS), sometimes referred to as a paper logbook to comply with Hours of Service (HOS) requirements. A helpful overview of the ELD Mandate 101 is provided by a website ELD FACTS.Com. ELDs and electronic on-board recording devices (EOBR) or automatic on-board recording devices (AOBRDs) share some common elements, such as:
• They track a driver’s Hours of Service electronically
• They need to be “integrally synchronized” with a truck’s engine, making sure drive segments are captured
• Most will pass data to a system where a safety or fleet manager can see e-logs in a near real-time basis, allowing everyone to be on the same page
To assist our present and future commercial clients’ ELD Rule knowledge, our John Bailey team suggests a perusal of FMCSA’s Implementation Timeline and ELD Brochure. Note: “AOBRDs may be used until December 16, 2019, if the devices were put into use before December 18, 2017. Starting December 16, 2019, all carriers and drivers subject to the rule must use ELDs. ELDs must have the capability of either telematic data transfer or local transfer.”
Telematics impact all drivers
Regular readers of our blog may remember that in late 2017, we published “High-Tech Autos Add to Higher Auto Insurance Rates.” At the time, we were reaching out to our personal auto insurance clients and never used the word telematics. But be assured, telematics, according to Wikipedia, “is an interdisciplinary field that encompasses telecommunications, vehicular technologies, for instance, road transportation, road safety, electrical engineering (sensors, instrumentation, wireless communications, etc.), and computer science (multimedia, Internet, etc.).” Commercial drivers and non-commercial drivers depend on different forms of telematics. Telematics in general help to mitigate driving risks.
At John Bailey Company, we represent some of the most reputable insurance companies in the industry, including The Hartford and State Auto. Here is State Auto’s answer to “What is Telematics?”
If you are having trouble viewing the video, you can watch it here.
Next step: Commercial auto insurance telematics and ELD primer
The John Bailey Company offers integrity, service and expertise. In an effort to insure a great life, we welcome our current commercial customers to reach out to us after reviewing our primer. At the same time, we encourage future clients to inquire about how fleet telematics can affect their business model. Businesses could improve their customer service, cut fuel costs, reduce operating expenses, and improve safety.
Why not take the next step and contact the John Bailey Company?