May 8, 2013 by Daryl Angier
After they retired, my parents bought a small place right on the lake in Brighton, Ont. To kill time on the 90-minute drive from Toronto, my mother would occasionally count the number of tractor trailers they would pass on Highway 401 on the way there. She’d usually stop when she got over 300, losing interest but nevertheless marveling at the amount of commercial traffic on Canada’s busiest highway.
Indeed, despite our country’s creation myth of dependence on railways, commerce in Canada relies heavily on an effective trucking sector. According to the Canadian Trucking Alliance, trucks move 90% of the foodstuffs and consumer products within Canada and over two thirds, by value, of Canadian trade with the US. Trucking is a $40 billion industry (compared to roughly $10 billion for rail) and around three quarters of that revenue comes from moving goods within Canada, according to Statistics Canada. Trucking is actually a little like insurance in that it will always be necessary. As Sherry Orr, BFL’s national practice leader for transportation, once reminded me, “you will never replace a truck. Technology will change but the fact of the matter is we’ll still need someone to drive that truck to get goods from point A to point B.”
Orr also pointed out to me that after fuel, insurance is the number one expense for trucking companies. Trucking, therefore, provides brokers a unique opportunity. In so many other industries, clients view insurance as a “necessary evil” that is not critical to business operations and treat it as a once-a-year transaction. By contrast, in the trucking industry the insurance broker is necessarily positioned to be a critical partner in the success of the client’s company, both from an operational and financial standpoint.
These days especially, trucking operators are looking for much more from their brokers than just the best price on insurance. They need expertise in risk control, regulatory compliance and what the right insurance markets are based on what and where they are hauling. In short, trucking operators need insight into what can make them a good risk and get to that best price.
As some of the people we spoke to for this issue also pointed out, the trucking sector is also becoming crowded with brokers chasing big premiums without bringing much to the table. The articles in this issue should help trucking brokers stock their toolbox.
This story was originally published by Canadian Insurance Top Broker.