Congress established a $750,000 insurance minimum for motor carriers back when it deregulated trucking in 1980 — and that number has not been raised since. A new bill in the House of Representatives would increase that minimum to $5 million.

Representatives Jesús “Chuy” García from Illinois and Derek Tran from California introduced the Fair Compensation for Truck Crash Victims Act, which increases insurance requirements for interstate motor carriers.

The Fair Compensation for Truck Crash Victims Act proposes two key changes: 

• Increasing the minimum insurance requirement for interstate motor carriers from $750,000 to $5 million. This new minimum accounts for inflation and the current cost of medical care and other expenses, according to the bill’s sponsors.
• Indexing the new minimum insurance requirement to inflation. This provision ensures that financial protection for crash victims does not erode over time, keeping pace with rising health care costs and other expenses.

According to a news release from Garcia’s office, not only has the cost of medical care risen dramatically since the minimum was set in 1980, but increases in the weight and size of trucks have also increased both the number and the fatality rate of crashes.

As Congress continues to consider further road safety legislation, motor carriers should at a minimum be required to carry insurance that adequately covers victims in the event of a crash, according to the bill’s sponsors.

The bill is co-sponsored by Reps. Steve Cohen from Tennessee, John Garamendi and Jared Huffman from California and Hank Johnson from Georgia.

Support for Raising Insurance Minimums

Kate Brown is a board member for the Institute for Safer Trucking (IST), a non-profit committed to helping truck crash victims and survivors throughout the country. Her son Graham was severely injured in a truck crash in 2005. The trucking company only had a $750,000 policy. 

“After my son Graham was seriously injured in a truck crash, my family saw firsthand how devastating the financial aftermath can be,” Brown said in a news release. “Even with support and resources, the medical costs were overwhelming. …. It’s time our laws reflect the true impact of these crashes and ensure victims receive fair, just compensation.”

Other groups supporting the bill include:

• Citizens for Reliable and Safe Highways (CRASH)
• Truck Safety Coalition
• Institute for Safer Trucking
• American Association for Justice
• Parents Against Tired Truckers
• Road Safe America

What Does the Research Say?

It's not the first time a bill has been introduced or a regulation has been proposed to raise the insurance minimum.

In the Moving Ahead for Progress in the 21st Century Act, signed into law in 2012, Congress required the Department of Transportation to give it reports every four years on the issue.

Earlier this year, the Federal Motor Carrier Safety Administration sent the latest report to Congress.

That report said since the existing minimum financial responsibility requirements for motor carriers were established in the 1980s, "the landscape of crash costs in excess of the current minimum insurance levels, particularly medical expenses, has evolved, leading to a disparity between current minimums and the actual costs incurred in some fatal and severe/critical injury incidents."

In fatal and severe/critical injury crashes, the resulting damages can significantly exceed the mandated minimum levels of financial responsibility, it noted.

However, it said, it doesn't have the data it truly needs.

"FMCSA faces persistent challenges in comprehensively evaluating the adequacy of these requirements. Most of the published reports and publicly available data sources on the adequacy of current minimum insurance levels are not subject to frequent revisions. This means that there is limited new information or analysis for FMCSA to consider."

In addition, it said, the agency doesn't have access to a great deal of relevant information. For instance, many lawsuits are settled confidentially under non-disclosure agreements. And a significant amount of insurance company data is proprietary.

"Consequently, FMCSA’s ability to provide a thorough assessment of motor carrier financial responsibility requirements is limited."