LTL Operations and Insurance

According to recent data, the parcel delivery industry is expected to grow by 9 percent annually to more than $340 billion globally by the year 2020. That big bump is highlighted by the state of the online shopping sector, including the push by websites like Amazon, eBay, and Wayfair, all working to change the way people shop. One industry directly impacted by this is trucking shipment/freight.

But beyond having more active freight delivery, trucking companies are also having to look into the effects this is having on new risks and liabilities. LTL (less than truckload) deliveries carry another set of risks that Over the Road trucking doesn’t usually have to consider.  With this in mind, it’s important to know that LTL operations require different insurance underwriting.

Looking at Limited Cargo Liability Coverage

Parcel delivery has seen a change in delivery makeup as Amazon shipment deliveries can involve 30-40 separate deliveries for one single vehicle. Larger trucks, such as trailer operations could also involve 10 to 15 different stops along with warehouse stops. The increase in deliveries, packages and clients all combine to pose more major risks behind the wheel.

The cargo liability for LTL operators is generally much more specific and limited and the shipper or consignee may have limited cargo insurance unless they choose to declare a higher value. Those terms are generally spelled out in the bill of lading.  

The LTL freight company should pay close attention to the wording on their bill of ladings and also the procedures required of the consignee to reduce and control the amount of unwarranted claims that are made.

Understanding the Truck Liability Risk for LTL Operations

Parcel deliveries involve:

  1. Smaller, lighter vehicles that make
  2. Multiple stops, and are generally
  3. Under some form of time constraint, and
  4. Frequently involve residential and/or commercial business environments.

This type of operation not only exposes the driver to more congestion and traffic issues but also unexpected exposures.

The net result of this is more accidents and, in some cases, higher severity to bodily injuries. Drivers of these operations really need specific, detailed,  and constant training to help avoid the accidents. The use of telematics to monitor the behavior of the driver is highly recommended.

About Western Truck Insurance Services

Western Truck Insurance Services is a commercial truck insurance agency with roots dating back to 1954. We have evolved into a highly respected, professionally managed, truck and transportation insurance brokerage. The hallmark of our organization is our desire to provide unparalleled service. We go way beyond what you expect to receive from an insurance brokerage. Equipped with state of the art automation, Western Truck Insurance can provide you with lightning fast truck insurance quotes, customer service, Insurance certificates and coverage changes.