Accelerating the Challenges of Transport Insurance

Transport insurance is going through a period of transformation, especially in the trucking and commercial vehicle sectors. Speaking to IBDrew Easton, executive vice president and division manager at Amwins National Transportation Underwriters (ANTU), said expansion into niche sectors creates opportunities.

“Just look at those gray trucks driving around delivering packages,” Easton explained. “We’re also seeing a shrinking radius for traditional long-haul carriers.”

Amwins leverages its expertise in various divisions – benefits, brokerage, programs and underwriting – to create niche programs and opportunities even within broader categories. Easton itself administers an environmental transportation program for carriers of hazardous and non-hazardous goods, which is essentially a niche within ANTU’s larger transportation specialty.

ANTU, or as Easton jokingly calls it, “’Ain’t U’. As in, “Why Ain’t you doing business with us?” is a strategic combination of the capabilities of Amwins and the former National Truck Underwriting Managers (NTUM). This combination has only strengthened its position with retail partners and the marketplace, consolidating its brand under the Amwins ANTU logo.

Focus on the niche

As Easton said, the industry’s emphasis on specialization correlates with opportunities IBAs markets become more niche-oriented, homogeneous exposure becomes attractive to insurers, increasing the visibility of expertise and making it easier to acquire unique capabilities.

“We’ve really focused on finding signature relationships for products,” Easton added, aiming to offer partners something exclusive, a trend that competitors are increasingly emulating.

Advances in technology and data use are also reshaping transportation insurance. An industry that has traditionally lagged behind in technology adoption is now embracing sophisticated data analytics.

“We have this huge amount of data. We still have a challenge to process it,” Easton admitted. But with modern tools and advanced data analytics, the industry is developing predictive patterns and moving from retrospective loss assessment to forward-looking models for identifying exposure and pricing.

Digital transformation in insurance is becoming ubiquitous, Easton says. Motor carriers are sharing operational data, such as location, speed, and harsh braking, that insurers use to assess risk quality. This data sharing is driving better operational control and predictive insights.

“We secure a lot of that (data) and we realize it can be very (highly) predictive,” Easton explained, emphasizing the industry’s shift toward real-time data. Data can also help create opportunities. For example, a quick search in an agency management system can reveal hundreds of unplaced reports, underscoring the need to build capacity for specific new niches.

The importance of mentoring

Reflecting on the challenges of risk assessment, Easton said: IB that concerns about rising rates, litigation and the severity of claims continue to plague lawyers – underscoring the importance of mentoring and development for new entrants to the market.

“We expect a lot more from these new people (claims, retail and insurance) who come in,” he added. “Team leaders like me are responsible for mentoring. But I think we may be missing opportunities.”

Previously, carriers offered sophisticated educational opportunities, including claims and underwriting schools. Formal education offered a deep understanding of the risk transfer process and a thorough knowledge of coverage and forms. Often, working with a subject matter expert or niche player offers specialized experience that, without “old school” training, can be career-long.

There is also a heightened need for more detailed communication in broker-client relationships. As Easton notes, “answering the phone, responding to emails and providing referrals are essential but often overlooked aspects of good service.”

“I think we tend to take services for granted,” he said. IB“I can’t tell you how many times people are surprised that someone answers their phone. That’s what we strive for. We’re definitely not the answer to every problem, but we’ll answer the phone and give you directions. We’ll answer an email and get you where you need to be.” ANTU is ready to help.

Challenges in transport insurance

The frequency of litigation and the seriousness of claims are also significant challenges. Easton pointed out that while the number of serious claims has increased, their actual seriousness has not necessarily changed. Instead, the financial demands associated with those claims have increased dramatically. Factors such as litigation funding and inflated medical expenses are driving up costs. Easton remains optimistic, however, noting gradual changes in tort reform and regulation aimed at curbing these trends.

“We’re seeing some changes,” he said. “We’re seeing changes on the edges with tort reform and laws trying to put in place reasonable solutions to liability and litigation. In some cases, people are having to disclose that there’s a third party that’s providing litigation funding. I think that’s where I find my optimism — that we as an industry need to drive the trend toward a more reasonable tort situation here in North America. (That means) we can get back to what insurance is — the many paying for the losses of the few. And now, unfortunately, we need a lot more of the ‘many’ to pay for those losses because they’ve become quite exaggerated.”