The Dangerous Impact of Smaller Truck Accident Settlements and Verdicts Under $1 Million
The Impact of Smaller Accident Settlements and Verdicts on the Trucking Industry
A lot of time is spent discussing the effect of nuclear verdicts, or verdicts over $10 million, but trucking accident settlements and verdicts under $1 million also have a negative effect on the trucking industry.
Between the danger of increased litigation with the smaller payouts, the rise of insurance rates, and the increased scrutiny on the trucking industry, these smaller verdicts put strain on trucking companies. You need to learn how to protect yourself and your drivers from all litigation issues.
Why are Settlements and Verdicts on the Rise?
The increase in accident settlements and verdicts under $1 million has a lot to do with negative public perception of the trucking industry and tighter restrictions against the industry. The public perception is that carriers are large corporations that don’t care about people.
Plaintiff attorneys have taken advantage of this belief to cooperate on an easy target for litigation. Law firms that focus on the trucking industry have set up structures to go after as many companies as they can. Many will go out of their way to solicit accident victims to file a claim with their firm.
With this structure, some firms can have 300 cases against trucking companies open at a time. These firms often seek for settlements rather than going to court as this gives them a quicker payout. These firms go after minor accidents, but the payout is usually five times the true cost of the accident to the victim.
Litigation financing has also played a part in the increase of settlements and verdicts. Third parties will provide the money needed to pursue a case and take a share of any payment received as payback for the financing. This can also involve a third party purchasing a plaintiff’s medical bills in exchange for part of the settlement.
This third-party financing has also contributed to an increase in fraudulent claims, which adds to the increase in litigation against the trucking industry. These issues trickle down into other areas and have led to increases in insurance costs on top of these other costs.
The American Transportation Research Institute (ATRI) recently did a study on the impact of accident settlements and verdicts under $1 million for the trucking industry, and found that certain issues lead to bigger payments for plaintiffs.
The research showed the top 5 causes of accidents that led to the highest average payouts under $1 million were:
- Poor driver history ($680,333)
- Phone use ($629,375)
- Hours of Service violations ($564, 531)
- Falling asleep at the wheel ($543,343)
- Equipment failure ($503,641)
Poor driver history is connected to poor hiring practices and inadequate training which leads to juries holding a carrier at fault for a driver’s mistakes on the road, which means bigger payouts. Driver history and reckless driving issues are a good indication of the average payment that can be expected.
The state where the accident occurs will also play a part in the payment size. California, Michigan, New Jersey, and North Carolina have the largest national averages.
Fatalities and severe injuries also increase payment sizes. In these cases, the payment was more likely to be over $600,000. This could have something to do with the fact that these cases are more likely to be settled out of court.
A carrier is likely to pay more if they settle rather than going to court. Settlements tend to be 37.7% larger than verdict sizes.
How Can You Protect Against Smaller Verdicts?
When it comes to these smaller accident settlements and verdicts, your best defense is a verifiable safety training record. A good place to start is with the top 5 issues that lead to increased payments (poor driver history, phone use, HOS violations, falling asleep at the wheel, and equipment failure).
When you look at poor driver history, you’re likely to find some common issues arising that you can focus training on. Deal with breaking these bad habits. If you can’t, it may be time to get rid of a driver before they cost you more in a lawsuit or settlement.
You also want to deal with any reckless driving issues. Reckless driving is any driving behaviors that disregard the safety of other people or property. This can include texting while driving, driving under the influence, failing to yield, etc.
The best thing you can do for your company is to set up a driver onboarding and ongoing training program to ensure safe driving behaviors. You can supplement these programs with corrective action training if an issue arrives to remind drivers of appropriate behaviors.
Many experts recommend at minimum developing a “Defensible Driver” program that covers entry-level maintenance, remedial driver training, corporate safety processes, safety technology plans, and consistent hiring and onboarding procedures. All these areas are discoverable during litigation, so you want to maintain proper documentation in each area.
Get the Tools You Need to Defend Yourself and Your Drivers
Don’t let truck accident settlements and verdicts under $1 million drown you in costs. Put the tools in place now that will help you defend your company and your drivers before you ever go to court. Infinit-I Workforce Solutions is an online training management system that will allow you to set up onboarding, ongoing, and corrective action training that will prove your safety record.
Would you like to see it in action? Contact us to set up a free demo. Learn how you can set, track, and document all your safety training efforts in one place.