Online Service Tracks Motor Carrier Insurance, Certificates

Insurance agents and brokers frustrated with issuing certificates of insurance for transportation risks may have a friend in an Oregon company that specializes in monitoring insurance data on motor carriers for freight brokers.

The company, TransCore Freight Solutions, wants to spread the word about how it can help the insurance industry through its CarrierWatch Insurance Monitoring Center. This service, which is free to insurance agents, promises to helps them reduce the time they spend sending out insurance certificates, which is supposed to happen every time a freight carrier puts freight on a motor carrier's truck.

Insurance information is needed before a shipper or freight carrier can move freight. CarrierWatch Insurance Monitoring Center helps move the process forward.

"What it [CarrierWatch] does is reach out to insurance agents to ask for certificates of insurance for motor carrier companies," said Kevin Scullin, product manager for CarrierWatch. "Broker customers who buy CarrierWatch are interested to know what levels of insurance [freight haulers] may hold and they look to us to provide the data and transmit the data via our Web site so they can use motor carriers with only a certain amount of coverage."

TransCore does not ask to be added as an additional insured or have a waiver of subrogation, so there is no liability for insurance agents since the certificate is informational only and does not confer any rights upon the certificate holder, the company said. Insurance agents also are not subscribers of the TransCore services or products, and cannot use TransCore products to get lists of motor carriers insured by other agents for the purpose of soliciting. TransCore said it has procedures in place to ensure that subscribers are legitimate transportation companies.

Since 2004, CarrierWatch has been monitoring freight and trucking carriers for freight brokers, as well as matching the brokers and carriers with each other to help them increase their business.

"The space we live in with our services is the spot or exception market," said David Schrader, senior vice president of operations for TransCore, which is in Beaverton, Ore. "What is unique is both parties don't know each other – the broker or shipper posts freight and waits for a carrier to contact them. They don't know who they are so we developed a number of tools to help freight brokers and shippers better qualify that motor carrier.

"If I'm a motor carrier who actively participates in the spot market, I am going to generate dozens of calls to my insurance agent every year because a freight broker will request a [insurance] certificate every time."

The company works as a service bureau to collect and update the insurance certificates on a real time basis, so freight brokers can access the information online, reducing traffic and work for insurance agents. The company also updates the insurance certificates annually when they renew.

"That is is huge if you have a lot of truckers, and for a lot of insurance agents that is what their specialty is. What we are hoping is they will really realize the benefit," said Kathi E. Marth, insurance specialist for TransCore.

A recent change from the Federal Motor Carrier Safety Administration (FMCSA) could increase demand for the monitoring service. As of March 2011, regulated motor carriers (except household goods movers and freight forwarders) are no longer required to file proof of cargo insurance with the FMSCA. Because of this, the public and freight brokers are no longer able to obtain information about a trucking company's coverage status from the FMCSA Web site.

"Since that has gone away, interest in services like ours has spiked," said Scullin. "Freight brokers used to use that as a minimum check and they now have to replace that. They have a choice to get the certificates themselves or use a service like ours to help them. Interest in knowledege of all things insurance related has really spiked in the last year."

Also the ACORD 25 Certificate of Insurance was revised to remove language stating an insurance company would need to send prior written notice to the certificate-holder of any policy cancellation. This could also make the monitoring center more popular, according to Scullin.

Eileen Hart, assistant vice president of marketing and product management for TransCore, said the firm has been working to educate agents and brokers about the service.

"[Insurance agents] are not sure why we are calling them and asking for a certificate because they have never worked with us," said Hart. "We are trying to teach the insurance industry about the value we are adding to their business."

The company said insurance agents and brokers who do understand their service have been very willing to work with TransCore and see the value in supplying the certificates themselves and helping their clients get business. TransCore said part of the appeal is it is a neutral party that does not sell any insurance products.

Hart said it is a tremendous job to reach out to insurance companies to explain who they are and what they are doing, and that it is absolutely free to them, but that this process is essential to keeping CarrierWatch efficient.

"Insurance is a very confusing subject for our customers," said Hart. "Freight brokers are very frustrated at having to become insurance experts because they have enough things to worry about. They are thrilled that we are helping them figure this whole thing out…We want and need [insurance agents] cooperation to better inform our customers."

The company said insurance agents should also find CarrierWatch useful for helping their clients get more loads and familiarizing themselves with more of the motor carriers in the industry.

"CarrierWatch has a lot of content beyond insurance but insurance is a critical piece," said Schrader. "We are monitoring 70,000 motor carriers and brokers who represent millions of loads every year. CarrierWatch is a repository for all of this content. At the end of the day, it is a productivity save for all parties involved – that's the message we want to send."

TransCore recently moved its CarrierWatch center in-house. It was previously monitored by a third party. TransCore executives said this move was made because the contract with the third party company was up and TransCore thought it could be more useful to clients and more accurately relay the information if the center was in-house.

"Since we have people who know insurance here, we know how to interpret the data and post certain info, rather than make [freight] brokers go through and decipher the information," said Marth.

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