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In the following Q&A with Construction Executive, Rick Keegan, president of construction at Travelers, and Bob Kreuzer, vice president of construction risk control at Travelers, offer insight on recruiting qualified commercial drivers and integrating them into a company’s safety culture, as well as the impact of telematics on construction fleets and the insurance products needed to limit financial liability.

Q: What steps should construction companies take to recruit qualified commercial drivers? Do the needs or skills required of drivers differ depending on the type of construction business?
KreuzerKreuzer: Commercial driving jobs in construction differ from those in other areas of commercial trucking. For example, load securement with construction equipment on a lowboy may be different than what many commercial drivers experience. As with any new hire, it’s important to fully understand the applicant’s background, including his or her driving history, prior experience and overall attitude toward safety. It’s helpful to road test all applicants in conditions they will actually face on the job. Driving might only be part of the job in some cases, so aim to be clear in job descriptions and interviews on the driving and non-driving expectations for a new hire.

Q: How should construction employers onboard new drivers and integrate them into their existing safety culture?
Kreuzer: The average motor vehicle accident-related workers’ compensation claim is almost twice the cost of the average claim for other types of accidents, according to the National Safety Council. Any employee who drives as part of their duties may be exposed to getting injured in an auto-related accident, even if they only drive on occasion. Contractors can have many workers that drive for company purposes sporadically; as a result, organizations may underestimate the number of people who drive as part of their workday. Claims can arise from a “non-identified” driver who was just given the keys for a single trip, sometimes not even leaving a worksite. Even those who rarely drive for the company should be included in driver training and subject to the same oversight.

A robust safety culture starts with senior management. A written program is a good start, but that alone won’t foster an atmosphere of safety. It really makes a difference when that culture is embraced by management and can be seen by employees, as they will likely follow the lead of their supervisors. It’s important for all safety programs to include specific expectations and enforce accountabilities consistently at all levels of the organization. If senior management takes a “do as I say, not as I do” attitude toward speeding and distraction, then they shouldn’t expect others to follow safety policies, particularly with regard to driving.

It’s also recommended to put a system in place for reviewing motor vehicle records annually for all identified drivers. Significant losses have occurred involving drivers with poor driving records that may have been identified with a simple motor vehicle record check.   

Q: How widespread is the adoption of telematics technology in the construction industry?
Kreuzer: Using vehicle telematics is slowly gaining traction in construction. There are potential operational and safety benefits to incorporating telematics systems into an overall fleet management program. Clearly defining a strategy for using the technology and information gathered from it will help contractors get the most out of their system. While some telematics programs are developed with fleet management as a priority, others emphasize safety.

Construction businesses that use telematics often pay greater attention to them for maintenance, routing and dispatching purposes, but do not always take advantage of the possible safety benefits. Having telematics devices that track driver behavior can be an excellent risk management tool when part of a holistic fleet management program. It can provide information that may help coach drivers on performance and improve safe driving behaviors. Contractors can improve their auto loss experience by integrating the use of telematics into an existing fleet management program.

KeeganKeegan: While there are potential benefits to using telematics, having data that identifies unsafe driving patterns may create an obligation for contractors to act and hold drivers accountable. While state laws vary, in some jurisdictions, having access to the information and failing to address unsafe driver behaviors may create corporate liability that may not have otherwise existed. Many jurisdictional provisions unique to the construction industry can add to the complexity of this situation.   

Q: What insurance products should construction businesses consider to limit their financial liability and that of their drivers?

Keegan: First and foremost, carrying excess limits above a contractor’s primary auto policy helps ensure there’s sufficient coverage to protect the company in the event of a serious loss. A significant amount of construction-related auto claims exhaust primary limits and extend well into a contractor’s excess layers. Contractors are often viewed as “deep pocket” defendants, so it is extremely important for them to carry limits that can protect their assets. As auto severity continues to worsen, some firms routinely underestimate the necessary amount of excess liability limits coverage needed. 

In addition, having the appropriate non-owned auto coverage will help protect contractors with employees who drive their own vehicles on company business in the event that employee is involved in an accident. This is a significant area of potential liability for contractors that is often overlooked because the lines between what is business and personal use can be blurred. 

Working closely with an agent or broker to review their insurance program at least annually helps contractors address and manage the business’s unique risks and financial responsibilities in the states in which they operate. Construction firms can be quite complex because the variety of vehicle types and mobile equipment commonly found in a contractor’s day-to-day operations have differing statutory requirements.

An agent or broker who has a broad understanding of the construction industry can help the owner effectively navigate these complexities with confidence. Carriers with a specialized focus on the construction industry can offer various fleet and equipment safety and training resources, as well as strong claims expertise to help control costs when an accident occurs.

Q: Do construction businesses mistakenly believe certain insurance products do not apply to their company or industry?
Keegan: An area contractors often overlook is their exposure to pollution liability claims. Construction site runoff, disposal, excavation, alleged seepage, accidental spills, utility strikes, accidental rupture and many others could cause pollution. While it may not be obvious, a vehicle or piece of equipment is often involved in a pollution-related issue. Having a broad pollution policy backed by a carrier with construction claims expertise can be a major advantage in the event of an incident that involves an allegation of pollution liability. In some cases, pollution coverage can be purchased on a combined policy that includes coverage for professional liability.  

Lauren Pinch is managing editor of Construction Executive. For more information, email pinch@abc.org or follow @ConstructionMag.

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