How high U.S. speed limits affect cross-border truck fleet coverage

A proposal to enforce speed limiters on heavy trucks operating within the U.S. has been dropped, creating some truck fleet insurance implications for cross-border operators.

The U.S. Federal Motor Carrier Safety Administration has twice proposed to restrict truck speeds to between 60-68 mph (96-109 km/h), once in 2016 and again in 2022. Posted speed limits reach 70 mph in several U.S. states and are higher in some areas.

“Among other factors, speed is considered part of the risk calculus for insurers, and assessing various drivers’ abstracts for speeding infractions informs how the risk is underwritten/insurance risk,” says Eddie Staines, vice president, Transportation & Specialty Auto, Canada, Intact Insurance.

“We know that higher speeds lead to reduced reaction times. This is a risk, as these larger and heavier vehicles require longer stopping distances.

“By operating at higher speeds, drivers may not have enough time to avoid debris on the road, sudden slowdowns of other drivers, or collisions. This results in high-severity losses, including significant property damage to automobiles and third-party property, as well as injuries and possible fatalities.”

Staines adds the use of telematics gives both insurers and fleet owners and operators detailed, real-time data on fleet and driver behaviour, which helps manage the effects of various driving factors.

“Although a fleet operator may be following the law and not convicted for any speeding events, they may still exhibit risky behaviour that could lead to potential losses,” he tells Canadian Underwriter. “In addition to identifying the occurrence of risky behaviours, telematics allows insurers to capture the context or environment in which these behaviours are taking place and respond accordingly in the risk calculus through pricing or client feedback.”

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Related: Protecting Canadian truckers from a tough U.S. claims environment

Withdrawal of the U.S. proposal on speed limiters doesn’t exempt drivers and fleet owner-operators from driving at appropriate speeds, Staines adds.

“Insurance premiums are based on several rating factors that vary for each account’s risk profile, including frequency and severity of claims,” he tells CU.

Aside from damage due to collisions, operating heavy trucks at higher speeds adds wear and tear to the vehicle, thereby increasing maintenance needs.

“Increased friction and heat from the higher speeds on tires can cause them to wear down faster; more forceful braking at higher speeds will lead to increased wear on brake pads and rotors; the engine generates more heat at higher speeds which could lead to overheating and component failure,” he says.

“Poorly maintained vehicles can be a contributing factor to a loss.”

Further, higher speeds may cause cargo in trailers to become unstable, leading to a rollover or a collision. And when high speeds are combined with bad weather, accidents become more likely. What’s more, speeding and aggressive driving, including weaving and tailgating, can sometimes be related.

Night driving creates additional safety risks for truck fleets.

“While overnight travel may sometimes be necessary, limiting it can lead to healthier drivers and fewer catastrophic or tragic losses,” Staines says.

“Some risks associated with nighttime driving include: reduced visibility, driver fatigue, higher number of impaired drivers, and higher wildlife activity.”

Phil Porado

Phil, an award-winning journalist with over 30 years of experience in financial topics, has been managing editor of Canadian Underwriter for more than three years.