#United States #Marlton #National Limousine Association #Limousine Insurance #UTRC Report

Addressing the Insurance Crisis in the Ground Transportation Industry

The National Limousine Association (NLA) has raised a crucial alarm concerning a burgeoning insurance crisis that jeopardizes the livelihoods of countless small and mid-sized ground transportation companies within the United States. This warning follows a comprehensive report from the University Transportation Research Center (UTRC) titled 'Curbing the Limousine Insurance Crisis,' which lays bare the unsustainable increases in insurance premiums affecting even those operators with excellent safety records and minimal claims.

Understanding the Crisis

Brett Barenholtz, the president of the NLA, emphasized that the report corroborates the distressing experiences of NLA members, revealing a dysfunctional insurance system that penalizes responsible operators. "Immediate reforms are necessary to safeguard small businesses, ensure equitable pricing, and restore equilibrium in the market," Barenholtz remarked.

Eighty-seven percent of limousine operators reported substantive increases in insurance premiums over the last three years, with a quarter experiencing hikes greater than 25%. Despite these alarming trends, close to fifty percent of respondents had no claims at all, and an impressive 93% reported no claims that exceeded their policy limits. Furthermore, 79% of operators have established formal safety programs, which tend to be overlooked by insurers altogether.

Root Causes of the Crisis

The UTRC report painstakingly identifies several driving forces behind this affordability crisis, suggesting that the costs endured by operators are ultimately passed on to business travelers. It highlights multiple factors contributing to the rising premiums, such as insurance fraud, inflated legal settlements, and regulatory delays that complicate affairs within the industry. The report also provides a detailed examination of the various states involved, laying out tangible solutions appropriate for industry stakeholders, as well as regulators and lawmakers.

Proposed Solutions

The UTRC’s findings reveal a three-tiered plan to mitigate this rising crisis:
1. Operator Strategies: Encouraging the adoption of telematics and alternative insurance models could help mitigate risks and manage costs more efficiently.
2. Regulatory Reforms: Streamlining rate approval processes and formally recognizing established safety programs can help stabilize insurance premiums.
3. Legal Reforms: Addressing excessive litigation and curbing third-party lawsuit funding is vital to keep legal costs manageable for operators.

Matt Daus, Esq., who chairs Transportation Technology at UTRC, expressed his hope that this blueprint for change will reinforce the industry's vitality. He urged all related parties to act on the report's recommendations promptly, stating, "The continued existence of the limousine industry hangs in the balance. This report cannot simply gather dust on a shelf."

The Role of Stakeholders

The NLA implores policymakers, insurance companies, and industry stakeholders to engage in constructive dialogue aimed at implementing the recommendations of the UTRC report as a means of ensuring a sustainable future for small and mid-sized operators. As this crisis continues to evolve, the NLA remains committed to advocating for the interests of its members, striving to uphold the integrity and viability of the chauffeur-driven transportation sector.

For a deeper insight into the report and its recommendations, interested parties are encouraged to visit the UTRC’s official website at www.utrc2.org/publications/curbing-limousine-insurance-crisis-hire-vehicle-insurance-reform.

Conclusion

As we navigate through this challenging landscape, the urgency of reforming the insurance framework for the limousine sector cannot be overstated. The NLA’s persistent advocacy coupled with collaborative efforts from various stakeholders will be essential in fostering a healthy operational environment for limousine services moving forward.