In this video, Hunter Nelson of Nelson Insurance walks trucking companies with ten or more trucks through the nuances of renewing and shopping fleet insurance. He explains why mid‑term shopping is rare for fleets and only occurs when coverage changes or a carrier cancels. He outlines the optimal renewal‑shopping window (roughly 120‑75 days before expiration) and stresses that agents should strategically target markets that are likely to be competitive rather than blasting every carrier. Nelson demystifies insurer profitability, describing loss ratios, expense ratios, and the fact that most trucking insurers only achieve underwriting profit once every 13 years, relying heavily on investment income. He highlights the key risk drivers that underwriters scrutinize—driver turnover, unqualified drivers, high claim frequency, and the potential for large (“nuclear”) verdicts— and how the narrative behind each claim matters. He advocates for leveraging telematics, dash‑cams, and high‑quality ELDs to provide data that can lower premiums, citing a case where detailed driver‑behavior data secured a significantly cheaper quote. Finally, he discusses the role of loyalty and relationship‑based negotiation, the impact of insurer capacity constraints, and how agents who provide timely, accurate information can secure better renewal terms. He invites viewers to contact his Sioux Falls‑based agency for further assistance.
Chapters
Hey guys, I'm Hunter with Nelson Insurance. I'm just going to go over here what, what to expect on your renewal on shopping your insurance as a fleet. This is going to apply to trucking companies at least 10 trucks here, because when you have a fleet versus 3 trucks, it's completely different. So I'm going to show you guys what to, what you gotta expect there. So our agency has multiple fleets we're quoting right now, we're working on renewals for right now, all sorts of different things. One thing that's different about fleets is, for one, the, the midterm shopping is almost never going to be a thing. I don't hardly ever see any midterm shopping with fleets, but it is, it is almost never going to be a thing. The guys that typically are going to be shopping the midterm is going to be Progressive, Geico, maybe Canal might get mixed in there. The only time you're really going to be shopping midterm is if there's a reason other than price. My current insurance company, uh, is no longer offering the coverage I need, they are going to be canceling me midterm, anything on those lines. So we have one or no. Started 9 trucks and is now up to 12 trucks, and it's on a non-fleet program, and so they won't let them add any more trucks. Hey guys, we're capped out. We now have a good reason to go to fleet. So that's exactly what we're doing. When it comes to fleet renewals and everything on those lines, your agent really should be shopping out, uh, your renewal thing every year. Now I'm not saying going and blasting the market. You guys have got 10, 20, 50, 100 trucks. Really, the shopping kind of lowers down the higher you guys have for truck count, and it becomes more so maybe negotiation, loyalty, and relationship-based there. So that's what you're going to see a little bit. You're not going to be going and blasting every, every single insurance market, because after a certain point, if you get 50 trucks, for example, an insurance company sees you for the 9th year in a row— hey, I got the 9th year, these guys have been with X insurance company for the last 7 We've been quoted this thing, we haven't won it. Here's the current price. They're going to really skim over it. Is there anything different this year? Is it worth quoting? Have rates changed? Has anything changed? If not, they're going to be— I'm not even going to bother wasting my time. These underwriters, these brokers, all these guys, it's crazy. They have so much— there's such a shortage of them, which I know there's a shortage of them. And so they get like 30 submissions a day. And so they have to work on what they think has the highest chance of actually closing that year. And because that's what it is, they are here to close new business. And it might, as weird as that sounds, it might sound like they don't want your business, but they're, they're just being calculated with how it is. And so if you've got 20 trucks, for example, you might have your agent going there and negotiating your renewal. You should be shopping out, but the agent should be strategically shopping you guys out because they shouldn't be going to a market that they know is not going to be competitive. They have certain insurance companies that are going to be in certain price ranges, some higher risk, some like lower risk, some are, you know, whatever, right? So if you're a high risk, they're not going to go into a low risk because they know they're going to decline. An agent should be doing that ahead of time. And so that way, when you do maybe get that lowest pool, then they can go to it and it's not the 7th year in a row and they go, I've seen this thing 10 times, I've never bound, I'm not, I'm not working on it again. And, uh, vice versa, right? If you got somebody who's paying $10,000 a truck and you go to somebody whose average truck price is $20,000, $25,000, because it's high risk, they'll be like, I'm never competitive on this thing. Why would I go here? And then when you do have losses, they're probably gonna price you for it because, you know, it's the 10th year they've been there. The other thing too is getting information to the insurer, your insurance agent on time, and ahead of time. And then good insurance agents really be shopping out maybe between 120 to 75 days out. Depends on the size of your fleet. But if the agent's not doing that, for one, you need to go find a new agent. If they are calling you that month or a couple weeks beforehand, hey, yeah, you're going to be taking an X amount of dollar increase, or your loss form is going to take 2 weeks to get to you, they're, they're at that point, they're just trying to be strategic in the sense of, if I give this guy the news late enough and give the information late enough, he's not going to have a choice but to renew. So you don't ever want to play that game either. Now, with getting information and having a good agent, there's going to be a lot of underwriting. It is mind-blowing to me that somebody's loss ratio— so loss ratio can be if you have $1 million in insurance yearly premium and you pay out $300,000 in claims, you have a 30% loss ratio. You would think the insurance companies be making $700,000. That's not quite the case. They're a business. They're going to have their expenses just like any other business. Their typical expense ratios are about 35%. So if you turn in 30% for claims, they have 35% in operating expenses, maybe 30% if they run a little leaner. They might be taking home anywhere between 40% and 35%. You might think that's an automatic win, and really it should be in my eyes. It blows my mind that it's not. If they're making 40%, I mean, good God, what, what market are you guys making 40% profit margins? The thing is on it though is that insurance companies, when it all is averaged out, they might— they typically, they're actually losing money. Insurance, trucking insurance companies make money once every 13 years, uh, for an underwriting profit. The other years that they're making money— the reason I keep insuring trucks is because of Invest That Money, the investment premium dollars, and then they get their investment on it. So that's usually a couple percent there. So really, it's not like insurance companies are making crazy money. Now, to get back to my point here, when it comes down to that stuff, there's a lot of different factors in there because where insurance companies really losing money on stuff, even if your law search has been phenomenal, is what are the risks that are applied here to lead to a nuclear— what are the chances that if you've had $0 in claim payouts, but you've got a lot of factors that lead to a higher chance of a nuclear verdict, if there's a $10 million payout, a multimillion dollar payout, whatever, you got a lot of years to try to make that up and try to make your money back. And that just kills all the profit on all the other guys. So that's why even though the insurance company is making tons of money off you guys, they're getting the rates jacked up. So what are these factors that need to be explained to the insurance agent so they can go tell the underwriter, make them comfortable that these verdicts are going to be very low? It is going to be driver turnover. If they got new drivers who are constantly being turned over, that means there's something probably wrong in the, in the underwriter's eyes. It's having unqualified drivers. It's having lots of frequency. Frequency can almost be worse than the actual claim payouts. If you go through 5 years, for example, 20 trucks, and you turn in 3 claims, and one's a million-dollar payout, that's really not going to be that bad because your claim frequency is incredibly low. Now, obviously, you're not gonna— you're gonna have more than 3 claims than, than that in 5 years. But if you go through and you're turning in 15 claims a year, And I don't care if the payout's $20,000 a year and you're paying $700,000 insurance. The thing is the risk there of having a very large loss is what the insurance companies are really looking at. That's almost, that's pretty much gonna be worse than having one large loss. And the explanation behind everything is a main key factor too. If you go through as a non-at-fault accident, someone got roped in, the insurance company just paid it to get out of the deal. That's gonna be a lot better than my driver was pissed drunk and swerved and hit a family, right? And, uh, don't have a drug and alcohol policy. Okay, it just kind of happens, right? That's what they're looking for. What's the reason that happened? What's gonna be done to prevent this next time? And the story behind everything. And so insurance agents, they're asking you a lot of questions. That's probably a good sign. The more questions, the better. Having the technology to show these insurance companies data that's going to make them comfortable too is going to be a huge factor as well. Going in there and having dual-facing, facing Samsara dash cams, Motiv dash cams, Verizon, whatever, is great stuff. Having a good ELD, not some off-brand cheap garbage. Having a good ELD because then they can look at your telematics data. And I know what you guys are thinking, I don't want the insurance company spying on me, whatever. But the thing is, it could save you guys a ton of money. I'm not talking like, oh, they give a 5% discount. What they're gonna look at is lost ones are just a reflection of accidents. That's what they are. They're an accident, right? They wanna see the data on what's gonna lead to an accident. If you got a bunch of data in there, that's, uh, speeding, hard brakes, swerving, like you can name, that's gonna lead to an accident. Probably don't share that data. If you got data that's good, obviously I'd recommend just sharing pretty much for like everybody, right? I'm just, I'm just saying, but like, I would recommend it for everybody because there is a lot more insurance companies that will take you. One of the— I'm gonna back up here real quick. One of the fleets I was just talking about was with an insurance company to acquire that data. And because his loss runs were really bad, having data that made them actually look very good got him a way cheaper quote. And see, the guy like $60,000 a year, huge help on that. And it's not because of some like 10% discount, it's because they looked at the data. Here's the actual stuff of it. Looks like this guy just had some really bad luck with the claims. He's actually got data that shows he's a pretty dang well-run trucking company. So we want to insure him and we're going to offer a better price because everybody else is using old school stuff with just pure loss runs and what your SAFER and CABS say, right? So having the technology, having the safety resources in place, everything on those lines is going to be a huge help. Sometimes having some loyalty to the insurance company, the insurance agent, can help with, uh, insurance agent negotiating down a little bit lower renewal. Hey guys, this guy's been with you for 3 years. You guys have made a ton of money off of him. I know the market's tough and you're taking a loss and everywhere else, but this guy is going to be profitable, right? Let's try to keep them on the books. Can we lower the— can we adjust this premium a little bit? What are you guys— what are your guys' concerns where you gotta bump up this rate? So there's some things going into you guys' renewal to shopping insurance to kind of arm is a bad thing. Looking at more data is not always a bad thing. Underwriters are scared of their own shadow. Anything that's unknown, they're going to assume the absolute worst. I know it sucks. It's none of their business. But with how much these guys actually do lose when— and lawyers going out there and suing for anything possible, they want to make sure that obviously they're a business, they're making money, and that you guys protected here. And so that's the behind the scenes on how this stuff looks. So If you guys got any questions, feel free to reach out to me. Again, I'm Hunter Nelson Insurance Agency. We're based out of Sioux Falls, South Dakota. All we do is trucking, transportation. We work with a lot of fleets. My father's a trucker, so I love about it and going through it. Appreciate you guys watching.
