Industry to Decide on Insurance Increase

On Tuesday, October 28, the Federal Motor Carrier Safety Administration (FMCSA) Motor Carrier Safety Advisory Committee (MCSAC) met to finalize their recommendations on the proposed increase to the minimum carrier insurance requirements and the Mexican cross-border program and update the MCSAC committee on the CSA initiative.

Motor Carrier Minimum Insurance

In regard to the proposed increase to the motor carrier’s minimum insurance requirements, the Agency announced that the Advanced Notice of Proposed Rulemaking (ANPRM), which is set to be released in the next few weeks, will not contain a dollar amount for the increase, but rather seek industry suggestions. The MCSAC recommended that the Agency examine the following areas in developing the rule:

  • what is needed to cover average claims;
  • current safety technologies and their role on insurance policies;
  • what type of inflation formula or hybrid plan should the Agency follow, if any;
  • the development of a victims compensation fund;
  • the possibility of phase-in period for those small carriers; and
  • A detailed cost-benefit analysis.

Additionally, the MCSAC understands that a $4.2 million insurance requirement may be too high in terms of premium costs for small carriers, and FMCSA should potentially consider a subjective downgrade to make the minimum financial responsibility amount viable. In light of the announcement that the ANPRM would not specify a specific amount, the MCSAC decided to wait and see what the Agency proposes following initial public comments. 

Mexican Cross-Border Program

In terms of the Mexican Cross-Border pilot program which has ended, the Committee believes that although the FMCSA may have done most of the things they said they were going to do in the Federal Register notices, the data collected does not reflect whether the participants are representative of what would happen if the border was generally opened. Additionally, the MCSAC has concerns that the pilot program attracted very few Mexico-domiciled motor carriers. Data collected and provided to the MCSAC, further demonstrates to be insufficient for analysis of long-haul trucking operations in the United States by Mexico-domiciled motor carriers for the following reasons:

  • very few (15) Mexico-domiciled carriers participated in the three year pilot program and few of
    those were in the pilot program for more than one year;
  • most of the vehicles and carriers in the pilot program did not engage in long-haul operations
    beyond the border commercial zones;
  • the inspection data was collected largely at the border during crossings when pilot program
    participants expected to be inspected; and
  • the overwhelming majority of the inspections were conducted on just two carriers.

CSA Initiative

The FMCSA provided the MCSAC with a brief update of the CSA initiative. FMCSA announced that the Safety Fitness Determination (SFD) rulemaking is currently scheduled to be released for public comment on March 11, 2015, and has been delayed because of the congressionally mandated crash weighting and accountability study. FMCSA announced that since 2010 when the CSA initiative was rolled out, annual roadside inspection violations rates have dropped 15%. Additionally, as of December 2013, FMCSA has sent more than 90,000 warning letters and last year the SMS online system hosted more than 68 million user sessions (seventeen fold increase over Safe Stat.) Thus demonstrating that “Safety Culture has moved to the Boardroom.”

FMCSA announced the rollout of phase-in three of CSA to include the nationwide deployment of Sentri. Sentri (formerly known as the Mobile Client Application) represents the next major step in the Application and Information Systems Modernization program (the Agency's IT modernization initiative). Sentri will ultimately combine the functionality from all of FMCSA's legacy Field systems and streamline the Agency’s existing workflow processes. By combining roadside inspection, investigative, and enforcement functions into a single interface, Sentri will provide Enforcement and Field users with easier access to carrier and driver information and will help in their efforts to target unsafe carriers and drivers and keep them off our roadways. Eventually, all of the legacy Field systems will be retired and replaced by Sentri.

MCSAC Committee members asked about the status of the CSA recommendations they made over a year ago, and FMCSA officials attending the meeting stated, that the Agency is always looking at ways to improve the program and they constantly reference the MCSAC recommendations when thinking of ways to improve how the information is displayed to the public and what information should be displayed to the public.