JUNE 10. The U.S. House of Representatives today approved by a thoroughly partisan 214-to-212 vote a measure that would prevent the Federal Motor Carrier Safety Administration (FMCSA) from increasing the minimum level of financial responsibility for motor carriers.
All but 18 Republicans voting supported and all by four Democrats voting opposed the amendment sponsored by Rep. Steve Daines (R-MT) to block funding for a planned rulemaking being considered as part of the Dept. of Transportation (DOT) appropriations bill (H.R. 4742).
A nearly empty House chamber initially approved the Daines amendment by a voice vote last night, but an opponent insisted on a recorded vote, which was postponed until today.
In an April 2014 report to Congress, FMCSA said it would develop a rule that would increase the minimum liability insurance level above the current $750,000 for property carriers and might impose a financial responsibility requirement on private motor carriers for the first time. The Motor Carrier Safety Advisory Committee devoted its May meeting to the issue. According to the latest monthly DOT rulemaking report, FMCSA plans to draft an advance notice of proposed rulemaking by the end of June and for it to be published for comment by November.
“The legislative history of the federal minimum insurance requirements strongly suggests that Congress recognized that crash costs would change and that DOT would regularly examine the levels and make adjustments as necessary,” FMCSA said in the report to Congress. “In conclusion, FMCSA has determined that the current financial responsibility minimums are inadequate to fully cover the costs of some crashes in light of increased medical costs and revised value of statistical life estimates.”
In introducing his amendment Monday night, Daines argued that FMCSA’s plan for higher liability coverage comes despite DOT’s finding that less than 0.2% of truck-involved accidents have property and injury damages that exceed the current minimum liability coverage requirements. “Current proposals regarding the insurance increase call for minimum levels to go up by more than 500%, and this would lead to a significant reduction in insurance availability for motor carriers, especially small businesses. The bottom line is this: the trial lawyers win, the small businesses lose.”
Daines said estimates suggest premiums could increase by more than four times the current levels, up to $20,000 per truck, and that more than 40% of currently operating motor carriers could go out of business due to these new requirements.
“There is no evidence supporting higher insurance requirements or that coverage levels result in the improved safety performance of a motor carrier,” Daines said. “DOT’s own report argued that increasing minimum insurance levels is not the best way to meet the needs of catastrophic accident victims.”
Rep. Matt Cartwright (D-PA) led the opposition to the Daines amendment and was the lawmaker who demanded a recorded vote. Cartwright last year introduced legislation (H.R. 2730) that would increase the minimum level of financial responsibility from $750,000 to $4.422 million – representing an inflation adjustment for the 34 years the minimum has been in place – and to adjust the amount annually for inflation related to medical care.
In floor debate, Cartwright called the Daines amendment “a threat to the safety of Americans on the roadway. It is counter to the goal that we all share, of protecting and preserving Social Security and Medicare, two vital safety net programs in this country; and, above all, it destroys accountability in the safety rules in the trucking industry.”
Cartwright cited the New Jersey tractor-trailer crash that killed comedian James McNair and seriously injured actor/comedian Tracy Morgan. “To suggest that $750,000, with today’s health care costs, is adequate to cover this kind of tragedy is ridiculous,” Cartwright said.
“In fact, the truth is that, since 1980, more than 100,000 people have died in tractor-trailer-related collisions,” Cartwright continued. “We are not talking about cases where there was a genuine dispute about who was at fault for the accident. We are talking about cases where it was clear that the tractor-trailer was at fault for the accident and people died, more than 100,000 over the past 34 years.”
Cartwright contradicted Daines’ figures, citing a recent study by the Trucking Alliance finding that 42% of the value of settlements paid by trucking companies between 2005 and 2011 exceeded the minimum insurance requirement of $750,000.
“When you don’t adjust for inflation, you are not doing the simple math that is required, and to suggest that adjustment for inflation is wrong somehow seems quite silly,” Cartwright said. When a truck is underinsured and the owner can’t pay the medical bills, the U.S. taxpayer picks up the difference, he argued.
“And what ends up happening is we get a form of corporate welfare, where trucking companies at fault for accidents that kill, maim, and disable people, all of a sudden, don’t have to pick up the difference," Cartwright added.
