Articles Posted in Trucking insurance

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This week in north Georgia there was a fatal crash between a tour bus en route to a North Carolina casino and a tractor trailer blocking traffic lanes while waiting to turn left. This happened on Georgia Highway 515 (also known as the Zell Miller Mountain Highway) at the intersection with Whitestone Road in Gilmer County.  The bus driver was killed and 43 passengers suffered a variety of injuries.

The preliminary investigation by the Georgia State Patrol  blamed the truck driver. Troopers reported that the truck driver was making a left turn onto Highway 515 southbound when he paused for traffic, leaving the trailer projecting across and blocking northbound lanes. The northbound bus driver was reportedly unable to avoid crashing into the truck’s trailer. However, first reports are not always conclusive.

This crash highlights issues with both tractor trailer operation and tour bus operation.

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I-16 truck crash May 19 2015

Truck crash on I-16 at I-95 on 5/19/2015 killed 5. Truck driver admitted falling asleep, is charged with 5 counts of vehicular homicide.

In the spring of 2015, there were two separate five-fatality truck crashes on I-16 in Georgia. The first one got most of the publicity because the victims were all beautiful young nursing students, but both were equally lethal and egregious. In both cases, there were at least indications that a truck driver fell asleep before running over a line of stopped traffic.

On April 22, 2015, in Bryan County, John Wayne Johnson, a truck driver from Louisiana driving for Total Trucking, a subsidiary of US Express, ran over vehicles stopped traffic. He killed five Georgia Southern University nursing students and injured two others. It appears he went to sleep as there was clear visibility on a long, straight stretch of road before he ran over the stopped vehicles. Johnson admitted he had been texting and exchanging sexually provocative message with a woman while driving but denied he was on the phone at the time of the crash.

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pinball different pathWhat do you do when insurance coverage is grossly inadequate for a catastrophic truck crash personal injury or wrongful death case?

Big truck wrecks can cause a lot of carnage. When a small passenger car is run over at highway speed by a 80,000 pound tractor trailer bigger than a Sherman tank, a tremendous amount of kinetic energy is unleashed. The results are often than catastrophic.

Unfortunately, the liability insurance required for big trucks has not been adjusted since President Reagan’s administration. Minimum insurance for general freight tractor trailers in interstate commerce was set at $750,000 in 1981. Minimum coverage for interstate hazmat trucks and passenger buses was set at $5,000,000 in 1985.

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The Georgia House of Representatives last week passed a bill which, if passed by the Senate and signed by Gov. Deal, would incrementally strengthen the leverage of automobile insurance policyholders who make claims under their “UM” (uninsured / underinsured motorist coverages.

The sponsors of this legislation, House Bill 303, are Rep. Dusty Hightower (from my old hometown of Douglasville), Rep. Alex Atwood (of St. Simons Island, but who I knew at Douglas County High School eons ago), and my other friends, Rep. Ronnie Mabra of Fayetteville, Rep. Tom Weldon of Ringgold, Rep. Trey Kelley of Cedartown (where I tried my first case as a young prosecutor before he was born) and Rep. Stacey Evans of Smyrna. Hats off to them for their efforts.

UM coverage protects a policyholder who is injured due to the negligence of a person who has no liability insurance, or less liability insurance than the injured person has in UM coverage. Unless rejected in writing, new auto insurance policies in Georgia include UM coverage equal to the amount of liability coverage.

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Truck driving is one of the most dangerous jobs around. Over the years I have represented individuals and families who were hurt when hit by a big truck. I have also successfully represented a number of truck drivers injured due to the carelessness of the driver of a smaller vehicle or other truckers.

One of the big concerns in suing the driver of an ordinary passenger car for serious injury to a truck driver is that the car may have inadequate insurance coverage to adequately compensate the seriously injured truck driver.

A recent decision by the Georgia Court of Appeals may change that.
In McGraw v. IDS Property & Cas. Ins. Co., — S.E.2d —-, 2013 WL 3215464 (Ga.App., decided June 27, 2013)( Reconsideration Denied July 5, 2013), the Court applied in the commercial vehicle context a statute passed in 2008 to require that automobile insurance policies must include Uninsured Motorist (UM) coverage equal to the amount of liability coverage unless the policyholder affirmatively elects UM coverage in a lesser amount.

OCGA § 33–7–11(a)(1) “requires insurance policies issued in Georgia to contain provisions for UM coverage which at the option of the insured shall be (i) not less than $25,000 per person, or (ii) equal to the policy’s bodily injury liability insurance coverage, if higher than $25,000 per person.” Infinity Gen. Ins. Co. v. Litton, 308 Ga.App. 497, 499(2), 707 S.E.2d 885 (2011). This Code section further provides that “[i]n any event, the insured may affirmatively choose [UM] limits in an amount less than the limits of liability [for bodily injury].” OCGA § 33–7–11(a)(1)(B). “This Code section was intended to make a policy’s liability limits the default provision for UM coverage, unless an insured affirmatively elects UM coverage in a lesser amount.” Infinity Gen. Ins. Co., 308 Ga.App. at 499(2), 707 S.E.2d 885 (citation omitted).

Therefore, when a vehicle insurance policy limits UM coverage to an amount less than the policy’s bodily liability limits without the insured having affirmatively chosen that lesser amount, the policy is not in compliance with OCGA § 33–7–11(a)(1). When that happens, the requirements of the statute take control over the terms of the policy. See OCGA § 33–24–12(a) provides that an otherwise valid insurance policy that contains a condition or provision not in compliance with the requirements of Title 33 “shall be construed and applied in accordance with such conditions and provisions as would have applied had the policy … been in full compliance with this title.”

In Dees v. Logan, 282 Ga. 815, 816, 653 S.E.2d 735 (2007), the court held, “When an uninsured motorist policy provision is in conflict with the clear intent of OCGA § 33–7–11, the policy provision is unenforceable and the statute controls.” When an insurer issues a policy with provisions not in compliance with the law the contract will not be rendered void but the provisions of the statute will be grafted into the policy”. Flewellen v. Atlanta Cas. Co., 250 Ga. 709, 714(3), 300 S.E.2d 673 (1983).

In the McGraw case, the policy application included no signed election of UM coverage than the liability coverage. While the declarations page specifies UM coverage limits at the lesser amount, this cannot support an inference that the policyholder made an affirmative choice among the various UM coverage options available under OCGA § 33–7–11(a)(1), because it raised merely a conjecture or possibility of that fact.

Because an earlier policy, by default, provided this higher amount of UM coverage, the insurance company could not “renew” that policy with a lesser amount of coverage because, under OCGA § 33–24–45(b)(2), a policy renewal must provide “no less than the coverage contained in the superseded policy”). The superseding policies, therefore, would also provide the higher default amount of UM coverage unless the policyholder affirmatively chose the lesser amount.

So if a company vehicle has $100,000 liability coverage, there is no affirmative written rejection of equal UM coverage in the files, and an employee is injured in a collision caused by a motorist with $25,000 coverage or even no coverage, then the uninsured motorist coverage on the company vehicle automatically increases to $100,000.

Now consider the potential importance of this to a seriously injured truck driver. The minimum liability coverage for interstate motor carriers is $750,000, but most we see carry $1,000,000 and many strong trucking companies carry several million dollars of coverage in several layers. Even intrastate trucking companies, who are only required to carry $100,000 liability coverage, often carry $1 million or more in coverage.

If a truck driver has a catastrophic injury or is killed in a crash caused by a minimally insured driver, and the trucking company’s insurance policy was “issued or delivered” in Georgia without an affirmative election of UM coverage less than the liability coverage, this may provide a means to collect on a judgment against the uninsured or underinsured motorist who caused the crash.

This will not help the trucker for a company whose insurer did not “issue or deliver” the policy in Georgia. When I saw this decision I immediately went through my cases where I am representing truck drivers, and all of their policies were issued and delivered is other states.

I do not expect insurers for trucking companies to voluntarily open the records or the checkbook on such claims. We can in Georgia request coverage information from insurers before suit under O.C.G.A § 33-3-28, which provides in part:

“Every insurer providing liability or casualty insurance coverage in this state and which is or may be liable to pay all or a part of any claim shall provide, within 60 days of receiving a written request from the claimant, a statement, under oath, of a corporate officer or the insurer’s claims manager stating with regard to each known policy of insurance issued by it, including excess or umbrella insurance, the name of the insurer, the name of each insured, and the limits of coverage. Such insurer may provide a copy of the declaration page of each such policy in lieu of providing such information. The claimant’s request shall set forth under oath the specific nature of the claim asserted and shall be mailed to the insurer by certified mail or statutory overnight delivery.”

I expect insurers to take the position that this only requires disclosure of the coverage shown on a declarations page and that it does not require disclosure before suit of the underwriting file with policy application and renewal documents.

More likely, the way to pursue unknown excess UM coverage for a truck driver is to file suit against the inadequately insured motorist who caused the crash, serve the trucking company’s insurer with the suit as a UM carrier, and then conduct discovery of the underwriting files. At minimum, there must be requests for production of documents to the trucking company’s insurer seeking the policy application and renewal papers. A lawyer handling these cases for truck drivers must be prepared to compel records custodian of the insurance company, and possibly subpoena records and records custodians of insurance agents and brokers. Occasionally, this may result in increasing the available coverage for a truck driver or his family from $25,000 to $1,000,000 or more.
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While Georgia is a long way from the Mexican border, as a tractor trailer and big rig accident trial lawyer based in Atlanta, I have for several years followed the controversy over allowing Mexican trucking companies to operate in the United States. Concerns about safety rules and practices in Mexican trucking have simmered since 1995.

Today the U.S. and Mexico signed an agreement to allow Mexican tractor trailers and big rigs to operate in the U.S. and suspend retaliatory Mexican tariffs that added 5 to 25 percent to the cost of U.S. exports sold in Mexico.

This is the latest development in the long-running controversy to concerns about the safety standards of Mexican trucking, which long blocked North American Free Trade Agreement (NAFTA) rules permitting Mexican trucks to cross beyond a 25- mile border zone.

The USDOT justifies today’s action by saying that Mexican trucks must comply with all Federal Motor Vehicle Safety Standards, and will have electronic monitoring systems to track hours on the road, and that Mexican tractor trailer truck drivers must take drug tests that are analyzed in the U.S., hand over complete driving records and prove their English-language skills.

A previous cross-border pilot program for trucking certification program in 2009 included only 157 Mexican trucks.

Reactions from interest groups has varied widely:

• The US Chamber of Commerce supports the agreement as “a vital step toward a more efficient U.S.-Mexico border,” according to a statement from COC president Thomas Donohue. Truckers drop trailers at the border before crossing. Older rigs, often called transfers, pick them up to cross and leave them for a long-haul truck waiting on the other side.

Regarding safety concerns, the Conservative Daily News blog points out that while USDOT will pay for electronic on-board recorder (EOBR) to monitor hours of service of Mexican tractor trailers, an “EOBR cannot determine if the driver of the commercial vehicle is working other than driving, or if this driver is asleep or awake. It will not ‘automatically’ do anything as the driver still must manually enter whether a change of duty status has occurred or not.” It quotes a report issued from the Congressional Research Service in February of 2010 which stated:

“The rationale of eliminating the truck drayage segment at the border, and of NAFTA in general, is to reduce the cost of trade between the two countries, thus raising each nation’s economic welfare. However the cost to federal taxpayers of ensuring Mexican truck safety, estimated by the U.S. DOT to be over $500 million as of March 2008, appears to be disproportionate to the amount of dollars saved thus far by U.S. importers or exporters that have been able to utilize long-haul trucking authority. . . . Any accumulated savings in trucking costs enjoyed by shippers therefore should be weighed against the public cost of funding the safety inspection regime for Mexican long-haul carriers.”

• The American Association for Justice Interstate Trucking Litigation Group, of which I am a board member, urged USDOT to bring up to date liability insurance coverage requirements, which have been unchanged since 1980, prior to implementing the cross-border program. The $750,000 minimum liability coverage for interstate motor carriers adopted in 1980 would be nearly $2,000,000 today if simply adjusted for inflation. USDOT responded:

“Mexico-domiciled motor carriers must establish financial responsibility, as required by 49 CFR part 387, through an insurance carrier licensed in a State in the United States. Based on the terms provided in the required endorsement, FMCSA Form MCS-90, if there is a final judgment against the motor carrier for loss and damages associated with a crash in the United States, the insurer must pay the claim. The financial responsibility claims would involve legal proceedings in the United States and an insurer based here. There is no reason that a Mexico-domiciled motor carrier, insured by a U.S.-based company, should be required to have a greater level of insurance coverage than a U.S.-based motor carrier. Increasing the minimum levels of financial responsibility for all motor carriers is beyond the scope of this notice and would require a rulemaking. In accordance with section 350(a)(1)(B)(iv), FMCSA must verify participating motor carriers’ proof of insurance through a U.S., State-licensed insurer. As a result, participating motor carriers may not self-insure.”

The Owner-Operator Independent Drivers Association (OOIDA) is bitterly critical of the action, and is challenging it in court in Washington. OOIDA asserts that Mexico has failed to institute regulations and enforcement programs that are even remotely similar to those in the United States, and there would be no relevant corresponding reciprocity for U.S. truckers. According to OOIDA, “This program will jeopardize the livelihoods of tens of thousands of U.S.-based small business truckers and professional truck drivers and undermine the standard of living for the rest of the driver community.”

Teamsters Union president Jim Hoffa also questioned legality of the program because it grants permanent operating authority to Mexican trucks after 18 months in the “pilot program” without Congressional authorization, and because DOT would use money from the Highway Trust Fund to pay for electronic on-board recorders for Mexican trucks. He said, “opening the border to dangerous trucks at a time of high unemployment and rampant drug violence is a shameful abandonment of the DOT’s duty to protect American citizens from harm and to spend American tax dollars responsibly.”

Industry groups that export to Mexico, and are impacted by retaliatory Mexican tariffs, support the decision. They include the National Cattlemen’s Beef Association (NCBA) , California grape growers , and Washington State apple growers.

This Georgia truck wreck lawyer may run down to the mall to buy a Rosetta Stone home study course on Spanish.
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In my truck and bus accident law practice in Atlanta, one of the more newsworthy cases in which I have participated arose from the crash of the Bluffton Univeristy tour buss in Atlanta in 2007. In predawn darkness, a bus took a confusingly marked exit ramp and crashed off a bridge, killing the bus driver, Jerome Niemeyer, his wife, and five Bluffton University baseball team members and injuring other passengers. I have been local counsel for ten of the team members.

After the Georgia DOT and the bus company’s insurer paid their coverage limits, litigation was initiated in Ohio seeking to have the university’s liability insurance apply to the bus company and driver.

Recently, teh Ohio Supreme Court ruled that a driver of a rented bus is covered under a university’s auto insurance policy.

The representative parties for our team in Ohio argued that Niemeyer was an insured because he drove a bus, with Bluffton’s permission, that Bluffton hired. The university’s insurers each filed a declaratory judgment action, arguing that the university did not hire but rather contracted for transportation services, making Niemeyer an independent contractor and unforeseen third party they did not intend to cover.

In a 5-2 decision, the Ohio Supreme Court sided with the plaintiffs, reversing the lower court’s ruling. Considering the plain meaning of “hire” and “permission,” the court held that Niemeyer was an insured.

Justice Paul Pfeifer wrote for the majority, “We are not persuaded by the contention that the driver of a bus that Bluffton rented from a company in the business of renting buses is an unforeseen third party, when a clause in the insurance policy covers ‘anyone else’ driving a hired auto.” He added, “Whether the insurance company intended the clause to apply is immaterial because the language of the policy supports a conclusion that Niemeyer is an insured.”

Justice Evelyn Lundberg Stratton dissented, writing that,. “Today’s opinion unreasonably extends coverage to a third party and effectively opens the door for similar claims under other scenarios because the omnibus clause is standard in many insurance policies.”

This opens the door for additional compensation for injured members of the baseball team.
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When you or a loved one have been badly hurt in a catastrophic trucking accident, you may expect someone from the trucking company or its insurer to try to lull you into complacency. The objective is to avoid paying the value of the case, which they recognize is substantial. The tactics may remind you of the old joke, “I’m from the government and I’m here to help you.” They are from the insurance company and are “here to help you.”

The standard tactics, which my friend Morgan Adams in Chattanooga discussed in a recent blog post, include some variation of the following:

1. Pretending to be your friend. At trucking defense seminars, claims adjusters talk about how they try to become friends with a family by apologizing and offering to buy them a car and a house in exchange for giving up their claims. The adjusters take every opportunity to demonize any lawyers that the family might hire to represent them. At all costs they want to prevent the family from talking to an experienced trucking lawyer who would know how to investigate the case, demand that the company preserve paper and electronic records, and discovery trucking company’s violations of laws that contributed to causing the crash. In one recent case we handled, the adjuster started out talking to the family about paying their deductibles and copays on medical expense, and replacing their car, while at the same time trying to dispose of the physical evidence. But when the family hired me, and I deployed a rapid response to preserve evidence and make appropriate demands, the company soon paid its million dollar policy limit. Insurance adjusters know that revealing the truth could increase the value of the case significantly, and will do whatever they can to prevent that.

2. The misuse of annuities. Structured settlement annuities are a useful tool in settling cases because all the lifetime payments are tax-free and the burden of managing investments is lifted. However, in considering structured settlements, it is essential to focus first on what the defendant or its insurer is paying. Insurance companies will often show an unrepresented plaintiff that they will pay your family a million dollars over the next thirty years, while failing to mention that the annuity only costs $100,000 (or whatever) while the case has a present fair value in excess of a million dollars. In addition, they will use one of their own affiliated companies and brokers to issue the annuity, just switching the money from one hand to another. Thus, they play a shell game and get by with paying only a fraction of what the case is worth.

3. Inflation. No one knows exactly what future inflation will be, but we know that historically there is likely to be inflation. The adjusters will not seriously discuss with you how inflation will affect the value of funds paid.

4. Future medical expense. They exclude consideration of future medical expenses that eat into money paid to the family.They often fail to inform you of the impact of reimbursement claims by your health insurer, and do not protect your interests against such claims.

5. Future income loss. They exclude consideration of the full loss of income of the victim. People who have had major injuries often can’t work as much or as long as they would have, even if they initially return to work at the same job and at the same rate of pay.

6. Non-economic loss. They treat the non-economic losses of the family as having little or no value. The loss of quality of life, or the loss of a parent, is a matter of immense value which must be accounted for in a fair settlement of a case.

Remember the insurance adjuster’s job is to try to minimize payments on claims. No matter how friendly they may act, they are not there to help you.
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Trucking is among the more dangerous occupations. A significant percentage of my work as a trucking safety trial attorney in Atlanta is representation of injured truck drivers and their survivors when a crash is caused not by the trucker, but by another motorist.

Many lawyers in such situations may overlook the fact that many trucking insurance policies include uninsured motorist (UM) insurance coverage equal to the liability coverage. It’s not always there, but it’s definitely worth checking.

So if a truck driver is hurt or killed due to negligence of a motorist who has only $25,000 coverage, the truck’s UM coverage is available for damages above $25,000 up to the UM limits of the policy on the truck.

This morning I received an insurance policy in a case where I represent the folks who were hit by an 18 wheeler. The policy includes $1,000,000 for both liability and UM coverage. If the trucker had been killed due to negligence of the other driver, rather than the other way around, the truck driver’s family could collected on the $1,000,000 UM coverage.
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Handling truck accident injury and death cases in Georgia, I have often seen how inadequate the levels of insurance coverage can be for the havoc created by large truck crashes. Now there are efforts to catch up the levels of coverage for 29 years of inflation.

The current levels of insurance coverage required for interstate motor carriers were set in 1980.

The Motor Carrier Act of 1980 set minimum insurance standards for interstate trucks at $750,000 for trucks hauling general freight up to $5 million for trucks carrying hazardous materials.

Adjusted to inflation according to the Consumer Price Index:

• $750,000 in 1980 equals $1,921,811in 2009, and is worth only $292,693 today.

• $1 million in 1980 equals $2,562,415 in 2009, and is worth only $390,257 today.

• $5 million in 1980 equals $12,812,075 in 2009, and is worth only $2,491,933 today.

My friend Steve Gursten in Michigan has done a good job summarizing some horror stories of the inadequacy of the 1980 levels of coverage required for trucking companies on michiganautolaw.com.
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