A Bluewire Perspective
Article By TODD MAIDEN, FREIGHTWAVES
Perspective by Bob Boyich
Management from J.B. Hunt Transport Services called out cost pressures on multiple fronts several times on a Thursday evening call with investors. Insurance costs were the most notable reason for a headline miss to fourth-quarter expectations.
A Bluewire Perspective
Some very interesting comments about the cost of insurance below, from Hunt's CEO...
“Given that the majority of motor carriers in the industry carry only $1 million in coverage, just above the legal minimum of $750,000 in coverage, it’s the larger carriers who bear the brunt or disproportionate share of the escalating insurance and claims cost,” said CEO John Roberts. “And ultimately, these inflationary costs get passed on to customers and consumers.”
Roberts said the number of claims above $1 million jumped 867% from 2010 to 2018. J.B. Hunt’s premiums resetting in 2024 have been 50% to 60% higher despite the company’s numerous safety and risk-mitigation initiatives.
The point to hone in on here is the comment that large carriers are bearing a disproportionate share of the escalating insurance cost. Small carriers with little equity can simply hand over the keys if hit with a nuclear verdict. Larger carriers with substantial assets, many with deep family history, are in a different position. They are buying excess and reinsurance to better protect those assets. In today’s market, that’s an expensive proposition.
Look to Bluewire’s analytics platform to uncover the severity risk exposure of your fleet or your insureds. J.B Hunt’s increases in claims and premiums are fueled by severity risk–a risk only Bluewire monitors. It’s time to gain visibility into where you are vulnerable to large settlements and jury verdicts before they happen.