Everything I know about commercial auto I learned from two women very early on while working excess lines. When I run into folks from that arena I like to dazzle them with stories of those girls. The problem is not many insurance professionals know the terms ‘bobtail’ and ‘deadhead’. Somehow most think I am making these terms up. Allow me to clarify.
A ‘bobtail’ refers to a tractor when not towing a trailer behind it. You may have seen them doing mock nine on the highway to another pickup.
A ‘dead head’ refers to a tractor towing an empty trailer behind it. They have dropped off one load and are traveling to another to another pickup or returning the trailer to the company.
In commercial auto, truckers are referred to as ‘owner-operators’ since they make a living off of various interstate or intrastate contracts with various distributors. It is cost saving for manufacturers and distributors to hire out owner operators than maintain their own fleet. That makes the owner operator responsible for maintenance and upkeep of the actual tractor – not the company.
The trucker owns his own tractor. When there is no ‘goods’ involved, the liability of any accident is all on the owner operator. That is when ‘dead head’ and ‘bob tail’ insurance comes in handy.
It used to be the ISO forms provided a ‘non-trucking’ policy but more recently we got the ‘motor carrier insurance’ form which makes it part of the commercial auto policy and a lot easier for us to write.
Understand this only covers liability, not physical damage. With liability coverage we run into most basic of the underwriting questions – motor vehicle activity, usage, geographic area, and drivers. Make sure you understand those before you submit over to the carrier.
That leaves physical damage coverage for the tractor itself. Since this is the owner-operators bread and butter, you want to make sure it’s covered as well. That is what makes the ISO change so nice, since the business auto policy offers physical damage.
It is funny how I was taught this business by two women. Currently, the largest liability risk running for trucking and truck driving are sexual harassment lawsuits. Trucking is the one of the last frontiers for women. Still, in 2016, you have a small chance of meeting a female truck driver.
The internet is overloaded with stories of women who were raped and/or sexually assaulted while paired with a male co-worker. There are numerous lawsuits pending now against one of the largest U.S. trucking companies CRST. You can follow here: http://www.dcvelocity.com/articles/20150529-unit-of-truckload-carrier-crst-sued-over-charges-of-condoning-harassment-of-women-drivers/ … https://newrepublic.com/article/135000/surviving-long-haul
It really shouldn’t be any surprise that terminology like ‘deadhead’ and ‘bobtail’ came out of an industry that made the name ‘rubber duck’ popular. In past year, the commercial business rates have been fluctuating and making easier to make those policies more cost effective.
Given current tensions, watch for the caution flag. Now that you have this terminology, you can knock the socks off of a couple new insureds.