Fleet Management News & Business Info | Commercial Carrier Journal
Issue link: http://read.dmtmag.com/i/620616
no mistake, the plainti 's bar, so-called safety advocates and the labor movement all view a dynamic, competitive and productive trucking industry as nothing more than a group of "bad actors" that needs to be pruned by any means available with no concern for due process. Unfortunately, industry's response has been neither rm nor consistent. From the outset, large carriers who are best able to "manage their compliance scores" have endorsed CSA/SMS methodology as a way to get competitive advantage. While trying to hold to the line of "licensed, authorized and insured" many shippers and brokers have crammed SMS scoring into contracts. is legislative cycle and the behind-closed- doors maneuvering of the highway bill has only confused the issues and at best kicked the issue "of who certies carriers as safe to use" down the road for another two years. In an attempt to get a "red light/green light" system, intermediaries pushed a go-it-alone measure in the House, resulting in an "interim hiring standard" that to plainti 's bar's delight would make use of any carrier with a conditional or unrated safety rating too toxic to use. Hopefully, a crisis can be avoided and this language will be removed altogether by the conferees in any nal bill. Meanwhile, the American Trucking Associations' nuanced provisions would take down the scores for the time being but allow the agency the possibility of ultimately certifying SMS methodology as t for use. is provision is in both the Senate and the House bills and has a good chance of passing, but SMS reform was not on ATA's agenda for its state trucking association's recent y-ins. An editorial in Transport Topics, which is ATA's news magazine, states, "From the very beginning of the Federal Government's CSA program the overwhelming majority of trucking has supported the idea of giving the public a way to compare one carrier against another." One has to ask, who is the ATA listening to to come up with this conclusion? e average trucker does not view safety as a game for eliminating competition or believe in demonizing the industry as a whole to gain competitive advantage. In this context, Lane Kidd, the spokesman for e Trucking Alliance, composed of six mega carriers, recently said that these companies not only want a competitive advantage but that they also support both increasing the insurance requirements to $4.5 million per accident and supported nancial investment minimums for new entrants. Since deregulation, I have not seen the industry so divided between the haves and have nots, nor have I seen a more overt fracture in our industry with large carriers supporting anti- competitive regulations. Adding to the chaos and misinformation surrounding SMS/CSA methodology is the position of major insurers and the cottage industry of data miners who serve them. At a recent seminar, a representative of a major truck insurer stated, "We want publication of SMS scores because without it, how could we possibly rate carriers?" e answer to that question is really pretty simple – you rate them the way you did before 2010, based upon loss runs and hard data, not akey and unreliable scores that change from month to month. Everyone agrees that SMS is not an accurate predictor of crashes and that for small carriers in particular there is not enough crash data – even when preventability is considered – to make an accurate safety tness determination. Using SMS scores for underwriting is like using a broken thermometer to determine if a patient as a fever when you know the temperature will not read accurately. Probably a better analogy is that CSA/SMS methodology is a virus, not a measuring device. Use of CSA scores by plainti 's bar is the root cause of increased broker and shipper liability and crippling mid-policy-term insurance adjustments by insurers that use it. Under CSA/SMS methodology, a small carrier can have a high degree of "yellow triangle fever" based on a single incident that has enduring consequences to its gross revenue and insurance costs. Until the virus is contained and used for its original purpose – to help the agency make its ultimate safety tness determination – if plainti 's bar, insurers and those seeking competitive advantage have their way, CSA u can onset quickly and be hard to shake and lethal. "SINCE DEREGULATION, I HAVE NOT SEEN THE INDUSTRY SO DIVIDED BETWEEN THE HAVES AND HAVE NOTS..." Henry E. Seaton, Esq. | Seaton & Husk, LP 2240 Gallows Road | Vienna, VA 22182 Tel: 703-573-0700 | Fax: 703-573-9786 heseaton@aol.com | transportationlaw.net Vo l . 1 0 , N o . 1 TRUCKSTOP.COM 15