Transportation Risk Management in Modern Times

1. Transportation Risk Management in Modern Times Michael Nischan, CDS, CCSPRisk Control & Safety Consultant

2. Those Crazy Drivers… • Travel in the left lane when driving slower than everyone else. • Travel in the HOV lane – without any passengers. • When approaching a red traffic signal, speed up to go through it so the four cars behind can also make it. • To save time, eat breakfast, shave, or apply make up while driving. • Turn signals are options not installed on most vehicles… so why bother using them? • Glad you got here safely!

3. Agenda • How to Manage the Risk • Hot Topics - Fatigue, Maintenance, Distractions • Post Crash Response

4. Motor Vehicle Crashes • Leading cause of accidental death • Primary causes • Distractions • Violations • Lack of training • Poor management oversight!

5. Cost of Crashes • Loss of life • Business interruption • Potential loss of business • Equipment replacement costs • Increased insurance premiums • Bad safety ratings • Costs of litigation • Costs are passed onto consumers. July 11, 2012 Double-fatality Thornton Road @ I-20 Witnesses said truck driver ran red light

6. Legal Perspective • Penalties, increased insurance costs, criminal liability, and civil liability. • Motor vehicle operators must exercise “reasonable care under the circumstances.” • Failure to exercise reasonable care is called “negligence.” • Negligence results in punitive damages that may not be covered by insurance. • Even if you do not cause a crash, because you are driving a business vehicle, people think the company has deep pockets, so they’ll sue. • This affects your bottom line!

7. How to Manage the Risk • Accountable person for transportation compliance and safety. • Utilize a written management program. • Communicate policies to drivers. • Utilize a training program (new-hire and ongoing) • Management • Drivers Transportation Policies Driver Handbook Training Manual

8. Transportation Management Program • Table Of Contents (highlights): • General operations • Driver hiring, training, annual review • Alcohol and drugs • Distracted driving policy • Weather precautions • Night driving • Post-incident procedures • Maintenance driver vehicle inspections, annual vehicle inspections • Fatigue hours of service • Vehicle idling policy • Load securement • Security – cargo and equipment theft is a big problem! • Compliance reviews Transportation Policies

9. Hiring Requirements • A solid transportation safety program begins with driver selection. • Your profitability is in the hands of people who drive on behalf of your business, regardless of who owns, leases, or rents vehicles (employer vs. employee). • Includes: • Sales personnel • Maintenance technician • Anyone getting reimbursed for mileage • Drivers of CMV’s (commercial motor vehicles) • Avoid negligent hiring, entrustment, retention!

10. Driver History • Employers need standards in place: • Pre-Employment • Background check • Physical / drug test • MVR (Motor Vehicle Record) • Pre Screening Program CMV drivers • Annually • MVR (Motor Vehicle Record) • Background check if position warrants • Random drug test if policy • What does loss history indicate?

11. What is a CMV? • §390.5 Definition • A commercial motor vehicle (CMV) is any self-propelled or towed motor vehicle used on a highway in interstate commerce to transport passengers or property when the vehicle: • Has a gross vehicle weight rating (GVWR), gross combination weight rating (GCWR), or gross vehicle weight or gross combination weight of 10,001 pounds (4,536 kg) or more, whichever is greater; or • Is designed or used to transport more than 8 passengers (including driver) for compensation • Is designed or used to transport more than 15 passengers (including driver) without compensation • Is transporting hazardous materials in quantities requiring the vehicle to be placarded. • A pickup truck towing a trailer may be a CMV.

12. Federal Motor Carrier Safety Regulations • Common regulatory parts are listed below (not all-inclusive) • Preservation of Records 49§CFR 379 • Special Training Requirements 49§CFR 380 • Controlled Substances & Alcohol Use & Testing 49§CFR 382 • CDL Standards; Requirements and Penalties 49§CFR 383 • Safety Fitness Procedures 49§CFR 385 • Minimum Levels of Financial Responsibility 49§CFR 387 • Federal Motor Carrier Safety Regulations, General 49§CFR 390 • Qualifications of Drivers 49§CFR 391 • Driving of Motor Vehicles 49§CFR 392 • Parts & Accessories Necessary for Safe Operation 49§CFR 393 • Hours of Service of Drivers 49§CFR 395 • Inspection, Repair, and Maintenance 49§CFR 396 • Hazardous Materials; Driving and Parking Rules 49§CFR 397 • Employee Safety and Health Standards 49§CFR 399 • Federal Motor Vehicle Safety Standards 49§CFR 571

13. CMV Drivers - Hiring Requirements • A necessary evil – paperwork and more paperwork • This helps to ensure that you hire a qualified driver. • Your profitability is in the hands of people who drive your vehicles… they hold the keys to your company. • The only way to ensure that you hire the RIGHT driver is to complete this paperwork. • §391 Qualifications of Drivers • §382 Controlled Substance & Alcohol Use & Testing

14. Best Practices - Training • Provide new drivers with a handbook to clarify your expectations and company policies. • Provide new driver training – don’t expect that they know it all... even if they think they do! • Provide frequent training as a proactive measure and to address incidents. • Utilize evaluations to grade drivers and provide feedback. • Constantly work towards improvements. • Remember that location managers need training too. Training is an investment, not an expense!

15. Driver Training Program • Online, interactive, instructor-led: • Distractions • Cargo Securement • Warm Weather Driving • Fatigue • Hours Of Service • Maintenance • Adverse Driving Conditions • Alcohol and Drugs • Following Too Closely • City Driving • Driver Vehicle Inspections • Night Driving • Security • Have regular driver training sessions! Driver Training Manual

16. Hot Topics: Fatigue, Maintenance, Distractions

17. Drowsy Driving Crashes • 100,000 crashes reported annually, ~1 million crashes linked to inattention due to fatigue. • 28% professional drivers suffer from sleep apnea (wellness issue). • In three seconds of micro sleep at 60mph a vehicle has traveled 265 feet without anyone at the wheel. • Most crashes occur midnight – 6:00 & in the midafternoon (circadian dip). • Vehicle drifts off road and hits stationary object; rear-end or head-on collisions, no evidence of braking or evasive maneuvers. • National Sleep Foundation

18. Hours Of Service Of Drivers §395 • Property-carrying CMV drivers using the sleeper berth provision must take at least 8 consecutive hours in the sleeper berth, plus 2 consecutive hours either in the sleeper berth, off duty, or any combination of the two. • Passenger-carrying CMV drivers using the sleeper berth provision must take at least 8 hours in the sleeper berth, and may split the sleeper-berth time into two periods provided neither is less than 2 hours. • Recordkeeping required (RODS, timecards, supporting documents)

19. Fatigue Management • Comply with Hours Of Service regulations / best practices. • Be sure drivers are not fatigued. • Do drivers have a second job – whether driving or not? • Do you interact with them enough daily to determine their state of alertness? • Any complaints about near-crashes, inattention, or fatigue? • Manage this process before it results in a serious crash!

20. Benefits of a good maintenance program: Prevent vehicle breakdowns. Prevent hazardous conditions that may result in crashes. Deliver goods in timely fashion without delay. Attain optimum vehicle component life. Predict operating costs more effectively. Inspection, Repair, and Maintenance §396

21. Inspection Elements Service brakes Parking brake Steering mechanism Lighting devices and reflectors Tires Horn Windshield wipers Rearview mirrors Coupling devices Wheels and rims Emergency equipment Retain for Three Months Pre-Trip Inspections Required Annual Inspections Driver’s Vehicle Inspection Report

22. Annual Roadside Inspection Events • Road Check • June (first Tuesday – Thursday) • 70,000 inspections by 8,500 inspectors • Brake Safety Week • September (second week) • 20,000 inspections, educational outreach • Operation Safe Driver • October (third week) • CMV and non-CMV traffic enforcement • Target aggressive CMV and non-CMV drivers • Increase awareness to public about safe operations around CMV’s

23. Are Distractions Really a Problem? Yes! Slower reaction times caused by cell phone use are comparable to that of a .08 BAC driver! 80% of all crashes and 65% of near-collisions occur within three seconds of a driver distraction.

24. Four Types of Distractions • Manual - involves touching something - dialing phone, changing radio stations, grooming. • Visual - involves looking at something. • Auditory - involves listening to something – conversation or music. • Cognitive - involves thinking about something. • No difference in interference from a hands-free or handheld • conversation.

25. Cell Phone Use While Driving • Use of hand-held cellular phone by CMV drivers prohibited; hands-free use permitted but not encouraged. • Texting while driving is never safe! • Variations of laws for auto drivers among states, with varying penalties. • Penalties for texting or violation of hands-free rule: CMV Drivers subject to civil or criminal penalties up to $2,750 and companies may be fined up to $11,000. All states must adopt this rule by 01/03/2015 for intrastate purposes.

26. Post Crash Response

27. Post-Crash Reporting • Drivers must be trained to report ALL crashes / incidents to management IMMEDIATELY. • Utilize Glove Box Accident Kits with cameras. • Know who to call before the crash - reconstruction expert and knowledgeable attorney. • Investigate all incidents for root cause and contributing factors. Global Positioning System (GPS)

28. Documentation • Who/What/Where/When/How • Who was involved? • What happened? • Where and when did it happen? • How did it happen? • Environmental / weather conditions? • Road conditions? • License plate numbers? • Other important details?

29. Photographs as Evidence • Disposable or digital cameras – great tool. • Shoot all available pictures at crash scene. • Photograph all damaged areas and undamaged areas of all vehicles. • Photograph the license plate of all vehicles close enough to read the plate and identify which vehicle it was on. • Photograph interior of the vehicles including the dash area and driving compartment, all safety equipment such as seat belts, steering wheel, pedals, and air bags.

30. Spoliation of Evidence • When involved in a serious injury or fatality, ensure that documentation and evidence is not altered or destroyed (including ECM data). • Contact your insurance carrier and attorney to discuss evidence preservation so that you do not find yourself accused of spoliation of evidence… which includes not having equipment repaired. • Maintain excellent recordkeeping, limit access and involvement to those who have a need to know, and secure all information accordingly. • Although the regulations permit you to discard DVIR's after 3 months and RODS & supporting documents (including GPS) after 6 months, you must keep crash-related documents.

31. Annual Trucking Litigation Seminar • The McCart Group, the law firm of Freeman Mathis & Gary, and Impact Collision Analysis present a one-day seminar about investigating and defending the Commercial Motor Vehicle accident case. • Present compliance elements, investigation protocol, and defense details. • Mock truck crash investigation with Georgia State Patrol Specialized Collision Reconstruction Team and Georgia Motor Carrier Compliance Division. • Followed by mock trial and Q & A. • Only seminar of its kind in Georgia.

32. The only thing that is for certain is change… • Enforcement initiative. • Signed into law July 6, 2012 – 31 provisions • highway & motor carrier safety. • Cargo & equipment theft - costliest crime in • America; costs exceeding all burglaries, robberies, • cyber thefts, and identity thefts combined. • Georgia #5 in nation.

33. What’s the Risk? The world’s most solitary tree stood for nearly 50 years in the Sahara Desert. There was no other standing tree within 250 miles. It was knocked down by a drunk truck driver in 1973.

34. What You Learned Today • How to Manage the Risk • Hot Topics - Fatigue, Maintenance, Distractions • Post Crash Response

35. The rewards for excellence are too great to • waste time doing anything "half-right." Michael Nischan, CDS, CCSP NATMI Instructor E-mail: michael.nischan@mccart.com Phone: 678.938.2012 Connect with me on LinkedIn! http://www.linkedin.com