H.R. 2577, the Fiscal Year 2016 Transportation, Housing, and Urban Development Appropriations Bill (THUD) was introduced last month.  The bill includes language that TRALA had lobbied Congress to support which would prohibit the Department of Transportation (DOT) from using any monies to support an increase in the minimum insurance requirements of for-hire carriers or to force these insurance increases upon private carriers.

 

To recap, in April 2014, the Federal Motor Carrier Safety Administration (FMCSA) announced that it would be moving forward quickly with a rulemaking to increase the amount of federally-required liability insurance coverage for motor carriers, brokers and freight forwarders.  This came despite findings by the DOT that less than 0.2% of truck-involved accidents have property and injury damages that exceed current minimum liability coverage requirements.  An initial rulemaking was released in November, 2014 that did not specify a specific number that the DOT had hoped to raise the minimum to, but it did build its case for an increase and asked for comments and within that rule stated another private carrier rulemaking would be forthcoming.

 

Current proposals under discussion at the DOT could lead to for-hire motor carrier minimum mandated insurance requirements rising from current levels of $750,000 to as much as $5,000,000.  What is particularly harmful to TRALA members is the stated plan of FMCSA to release the next rulemaking that includes private carriers.

 

This comes after the FMCSA eliminated the registrant-only classification, thus forcing nearly all renting and leasing companies to register as private motor carriers. The new regulations would result in a mandate that TRALA members meet the new higher minimum insurance levels even if they are not operating their vehicles and even though their motor carrier customers are also insuring to the federal minimum.   

 

TRALA met with senior staff at the FMCSA before their rulemaking was released to express our displeasure with renting or leasing vehicles being potentially included in any rule.  Following that meeting, TRALA, along with several other organizations, wrote a letter on April 27, 2015 to the Chairman and Ranking Member of the House Appropriations Committee's asking that the committee halt any funding that would increase insurance minimums or expand the requirements to private carriers during their mark-up of the THUD appropriations bill.  Ultimately, industry's request was agreed to and passed out of committee several weeks ago.

 

TRALA will now focus its energy on the U.S. Senate to educate and ask for support of the House version of the appropriations language regarding the insurance issue.

 

If you have any questions, please contact Jake Jacoby at jjacoby@trala.org or at 703-299-9120.