How Industry Changes are Making Insurance Options More Competitive

Choosing the right insurance for waste and recycling companies isn’t always an easy task. There are a lot of options to consider, and a lot of risks and exposures that come along with the industry. One national brokerage, however, is making the process simpler by lending a helping hand through the insurance selection process.

Risk Strategies, which was founded in 1997, specializes in insurance for a wide range of industries, including transportation, environmental and waste and recycling. It understands the exposures, liabilities and risks that companies face and helps customers identify the right insurance options for their needs.

Pam Caron, senior vice president and waste and recycling practice leader at Risk Strategies, recently spoke to Waste360 about Risk Strategies’ services and products, how safety technologies are making insurance more competitive and how the national brokerage is keeping up with industry changes.

Waste360: Tell us a little bit about Risk Strategies and some of its products and services for the waste and recycling sector.

Pam Caron: Risk Strategies is a national insurance broker with offices across the country. We are a full-service broker providing property and casualty, employee benefits and a variety of other products and services for many industries. I specialize in the property and casualty side of things and focus specifically on the waste and recycling industry, providing pollution liability, automobile, workers compensation, general liability and anything else that goes along with protecting waste and recycling companies from their inherent risks and exposures.

Waste360: The waste and recycling industry is in the top 10 list of most dangerous jobs in the U.S. Over the years, many have developed and implemented a range of safety solutions. What solutions have you seen work, and how have those solutions had an impact on the types of insurance companies are opting to use?

Pam Caron: Unfortunately, this industry is very dangerous, and while I have seen a big uptick in companies putting various technologies in place, the industry still remains the fifth most dangerous at this time.

I’ve seen telematics make a big difference with respects to safety in the waste and recycling industry.  Many companies have invested in telematics for their trucks and the results are paying off. These systems can be used to monitor driver performance and improve safe driving behavior. They can track certain behaviors such as hard braking, acceleration and speeding. Once these behaviors are identified, they can often be corrected or improved with training and coaching.    

Telematics can provide useful information if a truck is involved in an accident. While drivers might initially be apprehensive of these systems in their trucks, once they are exonerated in an accident, they grow to support them. Historically, if there was a big accident, it was deemed the truck’s fault. With the advancement of these technologies, insurance companies have a much better chance of fighting a large claim if the truck was not at fault. 

While the initial investment can be hefty, the tradeoff can be priceless if it can reduce accidents and save lives.

Waste360: Can you talk a little bit about the importance of these safety technologies and how they’re making insurance more competitive?

Pam Caron: From an insurance standpoint, for the first time ever, we are seeing some insurance companies require safety technologies such as dash cameras, fleet telematics and side guards. Simply put, if a company doesn’t have them then the insurance company won’t entertain quoting the company.  These safety practices used to separate the more attractive companies from the not-as-attractive companies, but now if they don’t have them in place, it’s limiting the insurance companies that will provide quotes. 

The insurance market for waste companies continues to harden, which results in higher premiums, especially for automobile liability and umbrella coverage. Waste companies that invest in safety technologies will ultimately see less claims, therefore making them a more attractive risk to the insurance companies.

Waste360: How can companies ensure that they are selecting the right insurance options for their business?

Pam Caron: The obvious and statutory insurance coverages are automobile liability for the trucks and workers’ compensation protecting injured employees. For companies that operate transfer stations, recycling centers, materials recovery facilities and landfills, general liability, property and business interruption coverages are critical as well. With the increase in attorneys focusing on the transportation industry, we are recommending higher excess liability (umbrella) limits to protect companies in the event of a serious accident. 

Right now, cyber insurance is a hot topic. It may seem like the industry doesn’t have too much exposure, but it does. Any company that has an employee’s personal information is at risk. 

An area of particular concern in the waste and recycling industry is the use of subcontracted haulers.  With the shortage of drivers and the need to keep product moving, more companies are hiring subcontractors. It is important to vet these haulers to ensure they have the proper insurance while hauling on your behalf. 

It’s also important to have an insurance broker that understands the waste and recycling industry and is familiar with the exposures and how to structure a program to ensure they are properly protected.

Waste360: Can you talk a little bit about SAFER scores and how they can impact a company that’s trying to get insurance?

Pam Caron: The Federal Motor Carrier Safety Administration develops SAFER scores for trucking and transportation companies. They use data from roadside inspections and crash reports from the last two years, and this data is used to identify motor carriers that pose the greatest risk to safety.

These scores are very important as most insurance companies are now reviewing them as part of their underwriting process. The insurance companies can not only review the scores but also detailed information broken down by unsafe driving, vehicle maintenance and driver fitness. 

We are seeing insurance companies decline to quote the insurance for a company based solely on this information. In addition, some insurance company’s reinsurance treaties preclude insuring any companies with poor scores or a conditional rating. This has been a big wakeup call because some companies are not aware that these SAFER scores are public and being used by insurance companies, attorneys, etc.

In some circumstances, the ratings can be improved by providing information as to what the waste company has done to improve their safety practices.

Waste360: As you know, this industry is always changing and evolving. How is Risk Strategies keeping up with those changes and ensuring that its offerings are in line with what the industry needs?

Pam Caron: It has been very exciting for me personally to watch this industry continue to evolve over the last 20 years. Waste and recycling companies have made significant investments in their technologies, processes and equipment through the years. I believe this will continue as the world has now embraced recycling and protecting our environment.       

Specializing in this industry has afforded me the ability to stay on top of this evolving industry. A large portion of our time is spent out in the field, where we are able to see the exposures firsthand and ensure that our offerings contemplate these risks. We have a strong commitment to helping with safety and training and have many resources available to do so. 

It is also important to stay abreast of the insurance companies that have an appetite for this industry, which is unfortunately not always the most sought after from an insurance perspective. It is critical to maintain relationships with the insurance companies and know their products.