Self insured Megas . How can they still survive

Dont no about the megas. But I worked for an agent with 60 owner ops and probably 100 or more company owned vehicles (cars, Van's, box trucks, tractors, yard dogs) They were self insured BUT only to 1mil. They had reinsurance from Lords of London who picked up anything larger than a million.

 

Thing is, go look at the safety score of say Swift. You'll be surprised at how safe they really are.
Most megas are just noticeable with wrecks because of the sheer number of trucks. On a mileage biases most are average, or some even better than average.

 

IF for example JB Hunt has 15000 Tractors, probably 12K of them on the road under a load. Just the Fuel burn in 24 hours is in the millions.

I took out a small pickup (Who was saved by a small ball on his antenna, allowing me to horse my cabover away at the very last minute. But NOT quite before touching him at the load bed in front of his rear wheel which for him was very fortunate.

3000 in damage as there was a totaled work computer behind that dent. JBH sent a agent not only to investigate me top to bottom with a inspection from hell (A internal suit) and had the ability to write 3000 dollars check and hand it to the pickup man. I was allowed to proceed with the Beer Load.

The thing the company did not understand but did now is that when they negotiated to hire me, I demanded a conventional only. Not Cabover. (North Little Rock had 50 parked conventionals in a remuda in one corner on their property by I-40) but they ignored me and issued me a 83 Eagle COE. Which I decided what the hell, it's only a experiment. But took out a vehicle with it just like I warned them about. Thats why I dont drive them anymore.

A billion dollar company noticing a 3000 dollar loss? Certainly. But it's not a problem they are such a cash flow. Its like maybe going to the store and buying say ... two days worth of produce for a stew for 20 bucks. I don't notice it TOO much in my overall budget.

Now if 100 drivers each week took cars out... well... HA.. thats going to get pricey. And increase in safety and other mechanisms to crack down on stuff like that. One time I witnessed first hand a JBH Truck in 1989 time period wreck and total his cabover and half his tractor under the overpass at the Chester Seaport-Boeing accessroad which was lavishly painted in pink all around NO TRUCKS LOW BRIDGE. Not just any pink and yellow, black but hot florescant large signs.

THUMP. No more JBH tractor (@70000 dollars, No more trailer, @30000 and god only knows the value of the ruined load in it. Driver? he was messed up.)

You can bet they noticed THAT.

 

Self insurance lets them set the 'rules' so they can hire drivers from a school and/or those without the 2 years of experience that most insurance companies demand.

When Matlack was owned by Rollins, they were self insured for the first $250,000.00 backed up by 'Rollins, Burdock, Hunter Insurance. When we had a claim we called the 'insurance department' and instead of an office on Matlack's 13th floor to the Rollins building, it was R,B,H's offices, not a Matlack employee.

I'm sure Rollins had a few reasons but we had the insurance response of a 100% insurance company while being self insured allowing us to take school grads, put them through another 30 days of school driving old tanks 1/2 full for a good slop and then 30 days with me or one of my trainers. Marginal candidates were allowed to sign away for another month before joining the union when the boss thought they could make it...

Usually I was right and he wasn't...we still had around 50% of the school kids after a year so it kinda worked and those 'kids' had no problem moving on after a year with Matlack.

sadly those days are long gone.

 

Yep, thats what I hear, the megas are self insured up to a certain amount, say maybe a million or so and then they purchase insurance to cover themselves above that number.

 

They save money on insurance because the cover the first 1 million themselves so most accidents they never call the insurance company. When I work for a MEGA company they said to cover all the accidents cost them $0.03 per mile. They would roll a truck almost every week was and it cost them like $50,000

 

In reality, self insured is a very wrong term. They just pay out of pocket for the day to day stuff and only put claims in for the big screwups.