Motor carrier underwriting can involve a lot of data.
The challenge isn't simply finding information. It's knowing what deserves attention and putting individual data points into the right context.
Multiple FMCSA websites provide motor carrier information, including identification, fleet size, commodity and safety information, including inspection, out-of-service and crash information. But no single field tells an underwriter everything needed to understand a motor carrier.
A structured review can help.
1. Confirm the carrier you're evaluating
Start with the basics. Review:
- USDOT number
- Legal and business names
- MOTUS status
- Operating authority status
- Other identifying information
MOTUS and SAFER distinguish among active, inactive and out-of-service USDOT statuses and provides operating-authority information where applicable.
The first step is making sure the information being reviewed belongs to the correct entity and understanding its current operating status.
2. Understand the operation
Next, establish what kind of motor carrier you're evaluating. Consider information such as:
- Power units
- Number of drivers
- Operation type
- Commodities or cargo
- Other relevant operating characteristics
- Safety performance
Fleet size alone isn't a judgment about risk. It provides context.
A small regional operation and a large multi-state fleet may generate very different amounts of exposure, inspection activity and safety data.
3. Review inspection activity
Roadside inspection information can help provide context around driver and vehicle compliance.
Don't stop at asking whether violations exist. Consider:
- How much inspection activity is available?
- What types of violations appear?
- Are issues concentrated in a particular area?
- Do similar violations appear repeatedly?
- How recent is the activity?
The amount of data matters too. A carrier with very little inspection history shouldn't necessarily be interpreted the same way as a carrier with substantial inspection activity.
4. Put out-of-service information in context
SAFER's Company Snapshot includes a roadside out-of-service inspection summary compared to "National Averages" based on more than 2 million motor carriers with a DOT number.
These national averages include a very broad range of operations, including:
- Long-haul trucking companies
- Local contractors
- Short-haul motor carriers
- Motor coaches
- Vans
- Limousines
- School buses
- Taxis
This creates a broad-brush perspective, which is why additional context is important when evaluating an individual motor carrier.
Vehicle and driver OOS information may deserve attention, but avoid treating one number as the underwriting decision. Ask instead:
- Is there enough inspection activity to provide useful context?
- Are OOS events concentrated in the vehicle or driver area?
- Has performance changed?
- Does anything warrant additional review?
The objective is not to apply a universal threshold. It is to understand what the information means within your organization's underwriting standards.
5. Review crash involvement carefully
Crash history is another important area, but it requires disciplined interpretation.
FMCSA's SMS uses State-reported crashes from the previous two years as part of its safety-prioritization process.
A crash record tells you that a carrier was involved in a qualifying event. It does not, by itself, tell you everything about cause, preventability or responsibility.
Review the timing, frequency and available context, then determine whether anything requires further investigation.
6. Look at direction, not just today's numbers
A current carrier record is a point-in-time view. Underwriting can become more informative when today's information is compared with earlier periods.
Ask:
- Has fleet size changed?
- Has inspection performance improved or deteriorated?
- Has crash activity changed?
- Are new patterns appearing?
- Has the carrier's operating profile changed?
FMCSA data is available through several sources, including the CSA/SMS website, DataHub and the SAFER Company Snapshot. Because these sources are updated at different intervals, historical context is valuable when determining whether the carrier is stable or changing.
7. Put performance into relevant context
Carrier data shouldn't always be interpreted in isolation.
FMCSA's SMS itself recognizes differences in carrier activity. It groups carriers with similar numbers of relevant safety events before assigning BASIC percentiles, and certain measures account for exposure.
That doesn't mean an underwriter should simply adopt FMCSA's methodology. It illustrates a useful principle:
Context matters when comparing carrier performance.
Peer benchmarking and cohort analyses can help an underwriter understand how a carrier compares with other operations that provide a more meaningful frame of reference.
8. Look for related entities when relevant
Sometimes the carrier being reviewed may share identifying information with other entities. That could include:
- Addresses
- Phone numbers
- Email information
- Representatives
- Vehicles
- Other shared identifiers
There may be perfectly legitimate explanations for those relationships. But when the information is relevant to the underwriting review, understanding related entities can provide additional context.
Carrier Software's Chameleon analysis can help surface these relationships.
A relationship is information to investigate. It is not evidence of wrongdoing.
9. Identify what actually requires follow-up
After reviewing the carrier, don't reduce the process to: "Is this a good carrier or a bad carrier?"
A better underwriting question is: "What, if anything, requires additional review before we make a decision?"
That might be:
- A changing inspection pattern
- A significant operational change
- Crash activity requiring context
- An unusual related-entity relationship
- Inconsistent information
- A data point that needs verification
The data should help focus the underwriter's attention, not replace underwriting judgment.
Motor Carrier Underwriting Quick Check
- Carrier identity verified
- DOT and operating status checked
- Fleet size and driver count cross-checked with submission data
- Operation type and commodities verified
- Inspection history reviewed
- Driver and vehicle OOS information compared via custom cohort metrics
- Crash analysis
- Historical safety trends
- Key Performance Indicator (KPI) analyses
- Check Chameleon Type I & II related entities
- Changes or inconsistencies identified
- Follow-up questions documented
Don't let one number become the underwriting decision
FMCSA's Inspection Selection System (ISS) is designed to help FMCSA identify and prioritize carriers for intervention. FMCSA distinguishes ISS scores from formal safety ratings.
FMCSA also provides the Safety Measurement System and the FMCSA Portal to enable people to assess motor carrier risk.
That distinction is useful for underwriting. Carrier Software's data can identify patterns, provide context and surface questions. It should not eliminate professional judgment.
Carrier Software's Underwriting Analysis and Carrier Risk Analysis bring carrier information together so transportation insurance professionals can easily and quickly evaluate the operation from multiple perspectives rather than relying on one isolated data point.
The takeaway
A strong motor carrier review isn't about finding one score that provides the answer.
Underwriting success depends on knowing all facets of a motor carrier's operations, including reviewing inspections and OOS information and studying crashes, loss runs, IFTAs and MVRs.
Carrier Software's automated Carrier Risk Analysis brings this information together in seconds, giving underwriters the option to use automated analysis or dig deeper with manual analysis when needed.
The checklist organizes the information. The underwriter still makes the decision.
Sources
This guide incorporates MOTUS and DOT data, cohort analyses, KPIs, and other calculated risk parameters developed by Carrier Software.
This guide is provided for general informational purposes only and does not constitute legal, regulatory, underwriting, safety, or insurance advice. Individual organizations should establish underwriting criteria and review procedures appropriate to their own appetite, standards, authority, and professional judgment.
Related Carrier Software Solutions