Intermodal Safety Briefing:
How CSA Works, Its Effect on Insurance Rates and How to Mitigate Risk
This intermodal safety briefing explores how CSA works, the effect it has on insurance rates, and how stakeholders can mitigate risk.
CSA is the Federal Motor Carrier Safety Administration’s data-driven safety compliance and enforcement program designed to improve safety and prevent commercial motor vehicle crashes, injuries, and fatalities. CSA consists of three core components: the Safety Measurement System, interventions, and a Safety Fitness Determination rating system to determine the safety fitness of motor carriers.
CSA affects motor carriers, including owner-operators, by identifying those with safety problems and prioritizes them for interventions such as warning letters and investigations. It affects a driver’s safety record based on their safety performance and compliance, which in turn impacts the safety record of the motor carrier they are working for.
The motor carrier’s safety data appears in the SMS, which is updated once a month with data from roadside inspections, including driver and vehicle violations, crash reports from the last two years, and investigation results. The SMS assigns "scores" and considers the number of safety violations and inspections; the severity of safety violations or crashes; when the safety violations occurred, with recent events weighted more heavily; the number of trucks a carrier operates and the number of vehicle miles traveled; and Acute and Critical Violations found during investigations. FMCSA organizes the SMS data into seven Behavior Analysis and Safety Improvement Categories and groups carriers with other carriers that have a similar number of safety events and then ranks carriers and assigns a percentile from 0 to 100 (the higher the percentile, the worse the performance) to prioritize them for interventions.
Drivers and motor carriers incurring "new" violations see the corresponding points weighted times three in their CSA scores for the first six months," USI Transportation Group Risk Control Consultant Kevin Mullen explained. "It is impossible for scores to improve as long as new violations are being incurred. That's important because insurance companies are using CSA scores, much like lenders use credit scores, to justify increased premiums. Motor carriers with lower scores can expect better quotes. Motor carriers with higher scores or "alerts" can even find it difficult to obtain insurance at any cost. They can be relegated to the assigned risk pool as their only option."
"CSA scores consist of violations a motor carrier should pay close attention to," added Cindy Verrecchia, an account executive with Bondar Insurance Group. "With every violation found to make up CSA scores, there is an increased risk that an accident could occur."
"Once a crash occurs, the consequences are out of the motor carriers’ hands," Mullen said. "Most crashes, certainly any crash involving personal injury, can be expected to be litigated. Claim settlements and jury awards are the number one factor affecting insurance pricing. Determining causation and implementing countermeasure policies and procedures to reduce or eliminate future crashes is paramount to a good risk management program."
"The impact of crash causation is important in the intermodal industry as well as the motor carrier industry," Verrecchia added. "With the various means of transporting goods, the odds of crash causation are increased. When the cost of transporting goods increases [due to higher insurance premiums] this cost is handed down to the consumer."
"As an insurance agent, it is important to help educate our motor carriers on ways to improve their operations from a safety standpoint for many reasons," Verrecchia said. "With rates rising and the amount of trucks transporting goods daily, safety on our roads can be implemented through many avenues," she said, including having a clear safety policy in place with frequent training to educate drivers, dispatchers and others.
Are there examples of incidents of CSA affecting insurance rates, and if so, what were the lessons learned?
"Incidents are impacting insurance rates tremendously in the current market," Verrecchia said. "For instance, if you do not maintain your vehicle, at some point the equipment will fail. When the equipment fails and a claim occurs, losses have to be paid and rates will increase year over year. With the cost of everyday operations increasing for one reason or another, there are certain areas that a motor carrier must put emphasis on."
"If CSA scores are not maintained properly, the DOT will issue a conditional safety rating which minimizes your ability to obtain insurance," she added. "If you are able to obtain insurance, the rate will be much higher due to the risk to the insurance carrier."
Mullen said he has seen insurance companies cite CSA scores as a reason in their non-renewal notices to motor carriers. "Similarly, we have seen insurance companies cite scores, including simply the lack of improvement over time, as a reason to not offer a quote to prospective clients," he said.
Mullen further noted that insurance companies are focused on severe violations, such as speeding 15-plus MPH over the posted limit, speeding in construction zones, texting, handheld cell phone use, and reckless driving.
"Many insurers expect their insureds to have zero tolerance with respect to these," he said.
A Few Tips
Ways to educate motor carriers about how to improve safety in their operations, Verrecchia said, include introducing workplace videos and media, conducting live training sessions with compliance manuals that engage employees, and hiring a safety consultant group to ensure that safety protocols are implemented efficiently and timely with ever-changing regulations.
Mullen added that well-written, comprehensive policies and procedures that are consistently enforced is the only proven way to reduce violations and resulting scores.
"It is possible to ‘engineer’ some violations away, such as governing truck speeds, but this approach often provides a false sense of security," he said. "Governing top-end speed, for instance, will do nothing to prevent speeding violations off highways or expressways which is where we see most occurring. There are no short cuts, no golden bullets. Policies need to be written, implemented, their effectiveness monitored, and the policies tweaked as needed on an ongoing basis. If violations aren't eliminated or greatly reduced it will be impossible to improve scores and obtain better insurance pricing.
For additional information on CSA, you can visit csa.fmcsa.dot.gov. In April 2019, IANA hosted a webinar exploring this topic. You can view it and download the presentation at www.intermodal.org/past-webinars.