Hopson: Motor truck cargo insurance is designed to cover goods in transit and not necessarily fraud, which results from organized theft, insider collusion, or even fictitious pickups where bad actors pose as legitimate carriers. Coverage can depend on how the loss is classified and what the policy covers. For example, fraud and deceit may have limited coverage under policy extensions if the insured party acted in good faith and was not complicit. However, if classified as theft, most policy language treats that as a specified peril that is covered. Coverage may also extend to goods that are resting at a terminal but most likely wouldn't extend to goods in long-term warehousing over 30 days. 

While some policies may include limited fraud coverage, full fraud protection usually requires separate crime insurance. For example, fraud involving employee collusion with drivers, dispatchers, or terminal staff can fall outside motor truck cargo (MTC) coverage and is more in line with crime policies. Mysterious disappearances or unproven losses often are not covered unless a specific endorsement is in place. Due to the nuances in crime, theft, fraud, and collusion, fleets should carefully review their policies, understand what is covered, and determine where additional coverage is needed.

Pryke: There's no question that technology, if used properly, can help manage risk. Advanced driver-assistance systems (ADAS), including warnings, alerts, and semi-autonomous technologies, can reduce the frequency and severity of losses. Dashcams provide transparency into driver behavior and fault, which can be beneficial since the motoring public is often at fault. We do not currently offer a published credit for ADAS or dashcams, but they can improve safety, impacting long-term effects on premiums. Telematics and GPS tracking help optimize routes, monitor driver behavior, and increase visibility, all of which reduce exposure.

While technology can be impactful, it isn’t the only solution, and there are two things that fleets can control: the drivers they hire and vehicle maintenance. We like to see that they have a driver's handbook that outlines training, compensation, and hiring and firing procedures because it helps us better understand their risk. Comprehensive maintenance is crucial for keeping vehicles operating properly and preventing minor issues from escalating into major over-the-road failures. If a cargo carrier scores within the FMCSA’s Safety Measurement System show repetitive issues, such as worn tires, it can reveal opportunities to improve a maintenance program. There are metrics online that cargo carriers can use to benchmark themselves. 

Pryke: Get to know your insurance agent, make sure they know you, and make sure they understand transportation. Having a partner who knows your operations and the industry ensures that your coverage evolves with your needs and the market.

This article was produced by Fleet Owner, in collaboration with Munich Re Specialty.