Transportation and Shipping
The transportation industry includes companies that provide services that move people or goods and also includes the infrastructure needed to support that same transportation. This industry consists of several sectors including air freight and logistics, airlines, marine, rail and all vehicles that carry people or products on the road. ICA’s broad experience in the transportation industry mentioned above also includes Clients that are in these corresponding supply chain service categories: trucking companies of all sizes that are local and some of the largest national coast-to-coast trucking companies (large fleets that distribute all nature of goods as well as captive reefer truckers that only carry refrigerated goods for retail supermarket chains to support their operations). Other truckers include moving and storage companies that are also both local and national. In those instances where our Clients are large national retailers, their captive trucking operations are in most cases larger than most trucking companies, which include hundreds or thousands of power units.
The logistics and warehouse operations that support this transportation sector is just as important with its own risks as is the movement of the goods themselves. In this regard, some of the largest property losses in the U.S. we have handled are as a result of fires to these warehouses that store their goods, which has increased our knowledge of engineering for valued-added warehousing. In this regard, it led to ICA’s manuscripted language regarding demolition and increased cost of construction coverages to include the insurance coverage for the demands of the improvements to the design of the real property that are required by the insurance company, that are not required by existing construction bylaws. It is most important that the security of these facilities, as well as the technology that is utilized, must be state-of-the-art in order to prevent losses that include cyber intrusion, which led to one of the largest international claims suffered by a well-known industry player and prevented the movement of goods both inside and outside the warehouse. See our Risk Management Program Marketing service.
Where transportation on the ground includes the movement of people, our Clients have included bus companies, taxi operations, limousine services and even ambulance services. Like their counterpart in the transportation/movement of goods, alternative risk transfer techniques require that these companies consider risk retention groups and possibly captive insurers wholly owned and insured by the transportation company itself or one that is a group captive jointly owned by different entities, but within the same industry group.
This industry has experienced premium rates increasing over recent years, and expectations reveal that transportation businesses’ rates will continue to rise, so therefore it is of most importance to look into alternative risk transfer techniques as a result of the hard marketplace.
Common to all sectors of road transportation, which includes the above-mentioned, is the need for driver safety, which starts with the hiring process. However, it far from ends there as the training and safety programs to monitor driver performance, whether it be monitoring devices, active surveillance or otherwise, are the keys to controlling the losses. We have found that those companies that take the time and have the wherewithal to have a stable of vetted drivers in advance of their need are most successful in reducing losses because they are not forced to indiscriminately hire at the time of need, which is extremely problematic. This safety procedure is axiomatic to this industry and should be a main “driver” in a safety program.
There are some risks in these industries that are more obscure, and one of these risks often overlooked is the possibility of advertising suits that attack their intellectual property, which can also include the nature and design of their vehicles and the components contained therein. In one circumstance, our bus company Client was sued by a competitor because of similarities in the interior design of the buses’ appointments that their competitor claimed plagiarized the competitor’s intellectual property. Transportation companies must also evaluate their advertising liability coverage and other intellectual property concerns that could put them at risk based on the above example. See our Enterprise Risk Management Service.
Other Clients of ICA have been in airline and airport management services, ferry services, steamship and tugboats, shipbuilding, marine towing and dredging industries. The transportation industry is a staple in the United States’ and global economies, and therefore ICA’s assistance to this industry is most important and has been well received over many decades because the risk management programs in this industry also require attention to compliance or regulatory issues.
According to one of ICA’s transportation clients: “We do not make any insurance decisions without consulting ICA first. They have been a pivotal part of our team and company growth over the last 12 years and we consider them an extension of management. They have continually saved us money, improved our coverage and kept us competitive during a hard automobile insurance market when many of our competitors have left the industry due to tremendous operational overhead…”
– Transportation Client
Contact ICA for a comprehensive list of client references.