ATRI's 10 critical trucking industry challenges from 2022
There is a myriad of exposures that can impact a motor carrier's drivers and bottom line. To ensure the safety of drivers as well as
the continued success of a fleet, it's critical to reflect on the most pressing issues affecting the trucking industry on a regular basis.
To aid in this process, the American Transportation Research Institute (ATRI) recently published a report, Critical Issues in the
Trucking Industry - 2022, highlighting the major challenges motor carriers across the country faced in 2022.
With the help of key stakeholder groups, ATRI compiled a comprehensive list cataloging 28 of today's most pressing trucking
challenges. This list was presented to over 25,000 industry contacts, and respondents were asked to select and rank the issues
impacting their fleet the most. Beginning with the most critical issues, this year's results were as follows:
- Fuel prices
- Driver shortage
- Truck parking
- Driver compensation
- Detention/delay at customer facilities
- Driver retention
- Compliance, safety, accountability
- Speed limiters
- Lawsuit abuse reform
As part of the report, ATRI also highlighted potential strategies to address these issues, and survey respondents were asked to rank them based on how effective they believed they would be. For example, in response to record-high fuel prices, a popular proposed action was to stabilize the nation's fuel supply through federal action.
ATRI's report can be particularly useful for organizations when it comes to identifying risks they may not have otherwise considered. Additionally, given that the report includes suggested solutions to industry challenges, motor carriers have a variety of potential policies they can implement to safeguard their fleet.
For more risk management guidance, contact Witkemper Insurance Group and Financial Services today.
Essential cybersecurity controls for organizations
Organizations continue to be at risk for cyber incidents. A comprehensive cybersecurity plan is critical to ensure your company data is protected by uncovering vulnerabilities and fixing potential risks. The infographic below outlines recommendations that could prevent cyber incidents.
Product Recalls on the Rise
The number of product recalls reached a 20-year high in the third quarter of 2022, according to the U.S. product recall index released by Sedgwick Claims Services Management Inc. Across the five industries tracked in the index, 1.22 billion product units have been involved in recalls, up from the previous record set in 2018 of 1.20 billion.
There are several reasons why regulators issued more recalls in 2022. For instance, the Food Safety Modernization Act of 2011 gave regulators more oversight of different food and products, and new technology, including artificial intelligence tools, allowed regulators to identify potential harms sooner. In addition, ongoing effects from the COVID-19 pandemic, such as increased employee turnover and staff shortages, increased the chance for human error.
Third Quarter Highlights
The driving factor behind the record-breaking number was the increases in the average recall size for the pharmaceutical and medical device industries, both of which saw their average recall size increase by more than 500%. While medical device recalls decreased in the third quarter of 2022, the number of units impacted increased by 411%. Similarly, pharmaceutical recalls fell 13.8% in the third quarter, but the industry saw 107.2 million units impacted.
Other highlights from the third quarter recall data include:
- Automotive recalls increased by 2.9%, but the number of impacted vehicles fell from 9.21 million in the second quarter to 5.23 million in the third quarter.
- The number of consumer product unit recalls decreased by 19.2%.
- S. Food and Drug Administration food and beverage recalls fell 18.3%, but the average number of units recalled rose by nearly 159%.
Mitigating Product Recalls
As manufacturers continue to face challenges relating to regulatory activity, ongoing geopolitical issues, supply chain disruptions, and an uncertain economic future, it’s important for organizations to take the following steps to reduce the threat of a product recall:
- Commit to quality. Commitment to turning out the highest quality products is the best countermeasure to the threat of a product recall crisis.
- Prepare a contingency plan. Research indicates that the first 48 hours of a major product incident are more crucial than the next 48 days. Every company should have a workable product recall and crisis management plan.
- Focus on training. Contingency plans aren’t of much use if they haven’t been tested and honed under simulated conditions to ensure the plan is effective.
- Respond with expertise and decisiveness. Even with a good team and plan, there is a place in a recall crisis for professional consultants.
- Transfer risk where possible. The last line of defense is a solid product recall insurance program—one that indemnifies the host of extra expenses and losses in revenue that come with product withdrawals.
As the number of products recalled continues to increase, organizations must be proactive in reducing their risk. Contact us today for more risk management guidance.
The dangers of presenteeism
Presenteeism in the workplace occurs when an employee comes to work despite feeling tired or unwell, considerably reducing their productivity. This problem is especially common among remote or hybrid employees, as they are more likely to not feel the need to take sick leave when they’re feeling unwell. It is also common among older workers, workers suffering from insomnia or mental health issues (e.g., anxiety and depression), and those with unhealthy lifestyles.
Presenteeism is often caused by poor workplace culture. Employees who fear losing their job or missing out on career opportunities are more likely to come to work or refuse to take paid time off when they feel unwell. This is particularly true when employees feel their work can’t be easily transferred or covered without consequences to quality, completion times, or interpersonal relationships.
According to the Institution of Occupational Safety and Health, presenteeism can lead to the following issues in workers:
- Increased stress and fatigue
- Worsened mental health
- Lowered morale and cognitive function
- Increased recovery time after injuries and illnesses
Furthermore, presenteeism can increase the risk of near-misses and accidents on the job—thus posing significant workplace safety concerns. To avoid presenteeism, consider the following tips:
- Don’t come to work if you feel unwell.
- Take paid time off as needed.
- Consider modifying your work schedule to better fit your needs.
- Eat a well-balanced, low-fat diet and exercise regularly to keep your body healthy and boost your mood.
- Improve your sleep schedule by establishing a consistent bedtime routine, passing on coffee after midday, and avoiding electronics before bedtime.
- Practice self-care by taking time to do activities that you enjoy.
Consult your supervisor for more information on the dangers of presenteeism.
Electric vehicles present new insurance challenges
Electric vehicles (EVs) continue to gain traction in the U.S. auto market. Last year, Americans bought nearly 450,000 EVs—an 83% jump over 2020. With many federal and state governments pushing for lower CO2 roadway emissions, EV demand is expected to soar during the next decade.
This has commercial fleet owners wondering what a world without gas- and diesel-powered vehicles might look like, particularly when it comes to the potential exposures EVs could create.
Unique EV Risks
Because EVs tend to cost more than standard automobiles, their insurance rates are usually higher. However, other factors unique to EVs could also make insuring them costlier. Such factors include:
- Cyberthreats—Like most new cars and trucks, EVs offer connected car technologies such as Wi-Fi, data sharing and semi-autonomous systems that leave them vulnerable to cyberthreats. However, the public charging stations EVs rely on to recharge their batteries add another layer of risk. Charging stations may serve as an entry point for malware attacks, data theft, system outages, bugs and glitches. What’s more, once a data breach occurs in a single vehicle, it may be easier for a malicious party to access the rest of the fleet. This is partly because four key elements essential to battery technology—cobalt, graphite, nickel and lithium—are currently in short supply. Even if supplies can eventually catch up with surging demand, EV auto shops will remain at risk for supply-chain delays, as these rare elements are sourced from distant regions all over the globe.
- Costlier repairs—Most EV parts cost significantly more than parts for gas-powered vehicles. Batteries are especially high-priced and vulnerable to harm. An accident that might be a fender-bender on a standard car could result in an EV’s total loss if the battery takes serious damage. Adding to costs, EV repairs usually require more labor hours. This is in part due to EV technology’s increased complexity as well as auto mechanics dealing with the learning curve of working on unfamiliar machinery. As a new generation of technicians gains experience, repair times should shorten.
- Extreme weather concerns—It’s unclear how much of a role extreme weather will play in EV battery performance. Under severely hot temperatures, batteries, on rare occasions, have been known to ignite or explode. Under cold temperatures, batteries hold their charges for a shorter period of time. However, it’s unknown whether these drawbacks are significant enough to make EVs impractical in certain weather conditions or climates.
- High voltage hazard—A number of high-voltage electric cables run throughout the body of EVs. When an accident occurs, exposed cables could cause serious injury to passengers or first responders trying to free crash victims from damaged vehicles.
- Battery problems—There are several risks associated with EV batteries that can potentially impact commercial fleets. For example, battery manufacturing defects can lead to large-scale vehicle recalls, putting fleet owners at an increased risk of business delays. Additionally, under certain conditions, lithium-ion batteries that power EVs can ignite or explode. Notably, battery fires burn longer and hotter, release more toxic fumes and liquids, and spread faster over a larger area than traditional fires. Such an incident would create a whole new set of insurance challenges.
- Pedestrian accidents—One selling point of EVs is they run quieter than gasoline-powered vehicles. Unfortunately, this lack of audible engine noise may also put pedestrians at greater risk of being hit if they fail to hear an approaching EV.
While uncertainty about new EV technologies will likely drive up insurance premiums initially, expectations are that prices will stabilize over the long term. Meanwhile, several other concerns will need to be addressed before EVs become scalable. These include the following:
Scarcity of repair shops and parts—Very few auto shops can handle EV repairs, so it may be difficult to find timely service. Further, shops that do fix EVs often have trouble locating parts.
Although it probably won’t happen overnight, EVs seem positioned to dominate roadways sometime in the near future. Commercial fleet owners who start thinking about EV insurance challenges today will be better positioned to thrive in a post-fossil-fuel landscape.