Underwriters Review/Scrutiny of FMCSA Out-of-Service Violations

Underwriters scrutinize FMCSA out-of-service (OOS) violations to assess the risk of insuring a transportation company. The FMCSA enforces regulations to ensure the safety of commercial motor vehicles (CMVs) and their drivers. When conducting inspections, they use the North American Standard Out-of-Service Criteria to identify critical violations. These violations can render the driver, vehicle, and/or cargo out of service until the issues are corrected or fixed.  Underwriters typically pay close attention to these violations because they indicate potential safety issues or non-compliance with regulations, which could lead to accidents, fines, or legal liabilities.

Here’s how underwriters may review and scrutinize FMCSA OOS violations:

1.      Severity of Violations: Underwriters assess the severity of the OOS violations. Some violations, such as those related to brake systems, tires, or driver qualifications, may pose significant safety risks and thus be viewed more critically.

2.      Frequency of Violations: Underwriters consider the frequency of OOS violations within a certain timeframe. A pattern of repeated violations suggests systemic issues with maintenance, operations, or compliance procedures.

3.      Impact on Safety Rating: Underwriters may review how OOS violations affect a carrier’s safety rating. A poor safety rating can indicate a higher likelihood of accidents or incidents, influencing the insurance risk.

4.      Corrective Actions: Underwriters investigate whether the carrier has taken appropriate corrective actions to address OOS violations. This includes documenting repairs, training programs for drivers or maintenance personnel, and changes in operational procedures to prevent recurrence.

5.      Overall Compliance Record: Underwriters evaluate the carrier’s overall compliance record with FMCSA regulations. A compliance history demonstrates a commitment to safety and regulatory adherence, which can mitigate insurance risk.

In summary, underwriters carefully review OOS violations as part of their underwriting process now more than ever before and continue to adjust insurance premiums based on the severity and frequency of OOS violations. Higher risk profiles may result in higher premiums or additional coverage requirements.  These violations provide valuable insights into safety, compliance, and operational practices, helping underwriters determine appropriate insurance coverage and pricing.  Remember that safety is paramount, and compliance with regulations helps prevent accidents and ensures the well-being of everyone on the road.

Article Submission: Mike Egan, The Selzer Co.


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