Cost of Truckers Workers Comp
Workers compensation insurance for interstate trucking companies can be hard to obtain because the insurance company underwriter has difficulty accessing the risk.
- Often, a trucking company is located in one state, the truck drivers live in other states, and the workers comp injury occurs in a third state.
- Normally in this scenario, the truck driver elects to be covered by workers compensation in the state paying the highest indemnity benefits.
There are interstate payroll classification codes available from the National Council on Compensation Insurance (NCCI) for use in most NCCI states. But the problem the underwriter has using NCCI ratings for trucking companies is the rates are not applicable in three big states – California, New York, and Texas.
- If the trucking company is domiciled in a state with high workers comp premium rates, the underwriter may choose to simplify and just use the higher state rate.
- However, when the trucking company is domiciled in a state with overall low workers comp premium rates, but most of the accidents happen in other states, the underwriter often uses a premium debit to increase the workers comp premium to a rate (hopefully) profitable to the insurance company (subject to the judgment of the underwriter.)
- Although the insured never sees the underwriter’s judgment as an additional charge, it’s always included.
Types of Workers Comp Injuries
Truck drivers have a disproportionate number of musculoskeletal injuries compared to workers in other workforces.
- Due to the nature of their work, involving many hours of seating, followed by brief periods of strenuous labor loading/unloading the truck, drivers are more prone to injury than those in other occupations.
- Unfortunately, many truck drivers fit the stereotype of overweight men who get little physical exercise and are in poor overall physical condition.
- Most drivers are paid by the mile; therefore, their working hours vary, resulting in constantly changing schedules and irregular sleep habits.
- These poor lifestyle habits directly impact the period of time the employee remains off work following an on-the-job injury.
The most common situations where injuries occur include:
- Vehicle accidents
- Slips and falls climbing in or out of the cab or trailer
- Strains and backs injuries from lifting and/or moving items
- Accidents while loading or unloading the trailer
- Slips and falls on loading docks
- Carpal tunnel injury
- Crush injuries where a part of the load falls on the driver
Most truck drivers also say kidney stones and hemorrhoids are occupational hazards, but very few drivers attempt to claim either condition as an occupational injury / disease.
Employee or Independent Contractor
Due to the cost of workers compensation for trucking companies, some companies try to limit their cost of workers comp by classifying all their drivers as independent contractors.
- If you use them, independent owner-operators who also drive for other companies on a regular basis can be classified as independent contractors and allow them to be responsible for their own workers compensation or disability insurance policy.
- However, both the IRS and the state board of workers compensation is going to tell you your drivers are employees, not independent contractors, if they drive only for your company, and you designate when and where the load is picked up and where it is delivered.
- If drivers working only for your company are classified as an independent contractors, it is quite likely the workers comp insurer will deny your claims and the "independent contractor" will then sue your company for the medical bills, all of lost wages (not the typical two-thirds paid under workers comp), plus pain and suffering, which is not paid under workers comp.
- Additionally, there will be penalties and fines for not having workers comp insurance, easily putting small and medium size trucking companies out of business.
Controlling Your Workers Comp Cost
The trucking company, like every other type of employer, should have a complete safety program in place, and:
- Should provide every truck driver with a copy of its safety policy and driver specific safety guidelines to eliminate injuries.
- Each driver must be required to attend at least one annual safety briefing to reinforce the company’s safety guidelines.
A drug testing program has a positive impact on the cost of workers compensation (and liability insurance) even if it becomes more difficult to find truck drivers. Better a sober driver and fewer injuries and claims!
- A successful drug testing program should include new hire testing, random drug testing, and mandatory drug testing after any accident causing damage to property, other people, or the driver.
- If drug testing is done only if the employee reports an injury, the truck driver will state he is not injured, but then in a few days will report he is now experiencing pain or other medical problems.
Health and wellness programs reduce the cost of workers compensation as well as the cost of health insurance benefits.
- Medical conditions interfering with the employee’s recovery can be prevented or reduced through health and wellness programs.
- The workers comp cost savings from the reduction of obesity alone more than pays for the cost of a health and wellness program.
State laws pertaining to this subject matter change frequently, so you must check with your legal counsel or a knowledgeable professional.