For this sector of the motorcoach industry, whose preferred mode of operation has always been face-to-face, one-on-one, your-place-or-ours, the coronavirus pandemic has left the major insurance carriers scrambling to adjust and adapt to new paradigms to continue serving and helping their client operators through this time of crisis.
Bus and Motorcoach News called on three prominent transportation insurance executives for their company’s experiences and perspectives on the developments and consequences over the past four months.
This panel included Bob Crescenzo, Vice President, Lancer Insurance, Long Beach, New York; Michelle A. Wiltgen, Assistant Vice President, National Marketing Manager, National Interstate, Richfield, Ohio; and Michael Haswell, Vice President, Business Development and Retention, RLI Transportation, Atlanta.
What has your company observed to be specific effects and consequences of the COVID-19 pandemic in terms of operations and responsibilities to your motorcoach customers?
Bob Crescenzo — Lancer Insurance took a proactive approach in the early going of COVID-19. We were the first insurer in this industry to extend to policyholders the option to temporarily suspend insurance coverage on their vehicles. We were careful to take into account their need to maintain minimal coverage in order to avoid defaulting on bus leasing and financing while keeping all Department of Transportation regulations intact.
We accomplished this by sending emails to our insureds and insurance brokers in conjunction with an extensive outreach campaign from our regional managers to more than 1,000 policyholders. We listened to learn their needs and have worked with their brokers to provide the necessary support. This unexpected opportunity to speak directly with so many insureds during this challenging time turned into an incredibly positive experience.
Michelle A. Wiltgen — At the onset of the pandemic, I do not think anyone, our company included, thought the coronavirus would have lasted this long and become so devastating. We implemented a short-term, 45-day relief program in mid-March for our passenger transportation customers. We realized then they would not be back in service within that time frame and would need additional help.
We insure many types of commercial vehicles, including non-emergency medical transportation, ambulances, trucks and cranes. Though the events of coronavirus significantly impacted our business, we were thankful the pandemic has not affected all the businesses we insure to the degree of the passenger industries. As a result, we were able to turn our attention to this group.
Our team has maintained constant communication with our customers and brokers, encouraging them to continue to keep us updated on their businesses. We are continuing to monitor the situation for as long as it lasts and will work with our customers, if needed.
Michael Haswell — The immediate and significant impact of the pandemic on the public auto transportation industry was an almost total shutdown. Amid it all, RLI Transportation wanted to develop a solution so that our customers could survive these challenging events. Our goal is to combine the best financial solution with the least amount of complexity.
What policies, procedures, programs has your company implemented in direct response to COVID-19?
Crescenzo — Lancer created a separate section of its website to collect and present pertinent information on COVID-19, while tracking critical federal and state financial assistance, loan and grant programs.
We have kept our policyholders informed through a continuous series of eblasts announcing regulatory changes and available financial relief programs. We produced a YouTube video, Coronavirus Crisis: Applying for the Paycheck Protection Program, a brief, easy-to-understand overview of the federal loan program to help our policyholders through the loan application process.
Lancer also created a toll-free COVID-19 Hotline for our regional managers to help our bus and coach operators with their questions and pressing issues. Our claims division has worked diligently during these times to resolve and close existing open claims, allowing our customers to remain focused on their businesses. Most recently, we released our “Reopening After Coronavirus” online guide, which provides essential information to help operators successfully get back to business.
Wiltgen — National Interstate extended its original relief program for the remainder of our customers’ policy terms and beyond for accounts that have recently renewed or are soon to renew. This allows our customers to place their vehicles in an out-of-service status at a 75% decrease in the liability rate.
We also allow them to suspend their collision coverage while still maintaining comprehensive coverage. This is important as many of the vehicles sit idle in a specific location, where they are more than usually susceptible to this kind of loss.
For our workers’ compensation policy holders, we have allowed them to decrease their payroll figures, thus their premiums. Understanding the need to get vehicles running and put back into service, our program allows such moves for maintenance reasons. We maintain close contact so, if our customers start moving vehicles, our policy will respond immediately.
Haswell — As an alternative to deleting vehicles and coverages or canceling policies, RLI Transportation offered our Public Auto insureds the opportunity to temporarily suspend their insurance coverage without charge, which they can apply to all or a portion of the fleet. If need be, an operator can maintain physical-damage-only coverage on specified vehicles. RLI will not charge a premium for suspended coverage during the time of the suspension, as though operators deleted these vehicles from their policies.
Suspending coverage with no premium charged allows our customers to keep their vehicles tagged and registered during the policy suspension, and resume operations as soon as demand for service returns.
What do you see as “lessons learned” from this experience for your company and employees?
Crescenzo — None of us have ever experienced this type of business interruption on such a large scale. However, COVID-19 has taught us that consistent crisis management planning and testing pays off. We also learned the importance of a team that can move quickly to implement solutions that meet the needs of our operators. As I believe our policyholders will attest, our decades of experience dealing with nearly every type of catastrophe and disaster left Lancer very well-prepared.
Wiltgen — National Interstate has always been a lean, hands-on organization. That has worked well for us during this time. We have learned, while not ideal, we are still strong and have figured out a way to work as a team while working remotely. I do not think remote work will ever take the place of face-to-face interaction — the human contact is so, so important! I do think that our team has the “get it done” attitude that has helped us to manage our business for these past three months and to be there for our customers.
Haswell — With motor carriers hurting so much from business evaporating so quickly, we are expecting to see lasting changes to the industry. RLI Transportation has always viewed our partnership with our agents and insureds as a long-term relationship. We have learned how our coordinated response to our customers has helped to strengthen our business partnerships with them and our agency partners, and the continued importance of staying in close communication with our customers.
