Transportation insurance is undergoing a revolutionary period, particularly in the trucking and commercial car industries. Drew Easton, executive vice president and branch leader at Amwins National Transportation Underwriters (ANTU), told IB that the expansion into speciality areas is creating opportunities.
“Just look at those grey trucks running around your neighbourhood delivering packages,” Easton told me. “We are also seeing a shortening of the radius for traditional long-haul carriers.”
Amwins uses its specialisation in multiple areas – benefits, broking, programs, and underwriting – to develop speciality programs and capabilities even within larger categories. Easton runs an environmental transport program for carriers of hazardous and non-hazardous commodities, which is essentially a subset of ANTU’s overall transportation speciality.
ANTU, or as Easton jokingly calls it, “‘Ain’t U’. As in, ‘Why Ain’t you doing business with us?’” represents a strategic merger of Amwins’ capabilities and those of the former National Truck Underwriting Managers (NTUM). This amalgamation has only fortified its position with retail partners and the marketplace, consolidating their brand under the Amwins ANTU logo.
Focus on niche
Easton told IB that the industry’s focus on specialisation correlates with capacity. As markets become more niche-oriented, insurers are drawn to the uniform exposure created, which improves expertise recognition and allows for the acquisition of unique capacity.
“We’ve been really focused on finding proprietary relationships for products,” Easton explained, striving to provide partners with something unique, a strategy that competitors are rapidly imitating.
Technology improvements and data usage are also altering transportation insurance. The sector, which has typically been slow to accept new technologies, is suddenly embracing sophisticated data analytics.
“We have this massive amount of data. Yet, we were challenged to digest it,” Easton admitted. However, with modern tools and sophisticated data analysis, the industry is developing predictive patterns and shifting from retrospective loss assessment to forward-looking exposure identification and pricing models.
According to Easton, digital change in insurance is becoming more widespread. Motor carriers communicate operational data, including as location, speed, and hard braking, with insurers to assess risk quality. This data exchange promotes improved operational management and predicted insights.
“We’re securing a great deal of this (data) and recognise it can be very (highly) predictive,” Easton said, emphasising the industry’s trend towards real-time data use. The data can also help to create opportunities. For example, a fast search of their agency management system may uncover hundreds of unplaced submissions, indicating a need to increase capacity for certain new niches.
Importance of mentorship
Reflecting on the problems of underwriting, Easton told IB that concerns about growing rates, litigation, and claim severity continue to worry practitioners, emphasising the necessity of mentorship and development for newcomers to the business.
“We expect a lot more out of these new folks (claims,retail, and underwriting personnel) coming in,” he told me. “Team leaders, like myself, are tasked with mentoring.But I believe we may be missing out on chances.”
Previously, carriers provided sophisticated educational options, such as claims and underwriting schools. The formal education provided a complete understanding of the risk transfer procedure, as well as coverage and forms. Often, collaborating with a subject matter expert or niche player provides a specialised experience that, without ‘old school’ training, could take a career to develop.
There’s also an increased need for more thorough communication in broker-client relationships nowadays. As Easton pointed out, “answering the phone, responding to emails, and providing referrals are basic yet often overlooked aspects of good service.”
“I think we tend to take service for granted,” he told IB. “I can’t tell you how many times folks are surprised their call was answered by a person. That’s what we aim for. We’re definitely not a solution for all things, but we’re going to answer the phone and offer direction. We’re going to respond to that email and get you to where you need to be.” At ANTU, they stand-ready to assist.
Challenges in transportation insurance
Litigation frequency and claim severity are both significant problems. Easton noted that, while the number of serious claims has grown, the actual severity has not altered. Instead, the costs connected with these claims have risen. Litigation finance and rising medical bills are driving up costs. However, Easton remains optimistic, pointing to modest advances in tort reform and legal rules aimed at reversing these patterns.
“We are seeing some changes occur,” he told me. “We are witnessing around-the-edge changes with tort reform and laws attempting to place reasonable controls on liability and litigation. In some cases, individuals must disclose that a third party is supplying litigation funds. I believe that is where my optimism stems from: that we, as an industry, must lead the trend towards a more reasonable tort scenario in North America. [That implies] we may return to the essence of insurance: the many pay for the losses of the few. And right now, sadly, we need a lot more’many’ to compensate for these losses because their value has become overstated.”
