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Written by John McMahon, Vice President, Transportation Group Trucking company owners in the Chicago area face a number of challenges that impact their businesses, with multiple risk factors threatening operational stability and profitability.   Here's an in-depth analysis of the five most significant risks affecting local trucking operations. 1. Economic and Financial Pressures Chicago's trucking sector continues to experience a prolonged freight recession that first took hold in 2022. According to the American Transportation Research Institute, local operators are continuing to face a decrease in freight volumes falling below 2023 benchmarks while operating expenses continue to climb. Adding to these pressures, the average cost per mile has now increased from $2.251 in 2022 to $2.270 in 2023 . This combination of reduced demand and escalating costs has left many local trucking companies navigating increasingly narrow profit margins. 2. Increasing Total Cost of Risk The total cost of risk has become increasingly challenging for Chicago trucking companies. Insurance markets are experiencing significant strain due to: Escalating economic pressures Increased frequency of catastrophic weather events Rising litigation costs All 3 of these risks have led to further increased insurance rates. In response, carriers are exploring alternative risk insurance solutions to keep costs down, including higher deductibles and taking on more risk than in previous years. This shift in risk retention strategy could have long-term implications for company stability and profitability. 3. Regulatory Complexity and Legal Challenges The legal landscape has become increasingly challenging for trucking operations, characterized by: Expanded use of litigation funding Increased personal injury advertising Implementation of the Reptile Theory in courtroom proceedings, leading to lawsuit abuse that is plaguing the industry New state-level employment status tests, putting independent contractor status in jeopardy These factors have created a complex regulatory environment that requires additional resources to navigate effectively. 4. Industry Fraud and Cargo Theft Security challenges have intensified significantly in 2024: Fraudulent activities, including identity theft and double brokering, have increased by over 30% in Q1 2024 According to the FBI, annual cargo theft losses range between $15 million and $30 million These security breaches not only result in direct financial losses but also lead to increased insurance premiums and operational costs 5. Rising Operating Costs Operational expenses continue to increase, with several key factors contributing to the increase: The cost and availability of parts is leading to extended vehicle downtime and increased insurance costs Interest rates have risen making it more expensive and more difficult to get financing and help from banks. Conclusion Chicago trucking companies face a complex risk landscape that requires careful navigation and strategic planning. At Cottingham & Butler, we understand that each trucking company faces unique challenges. Our personalized approach ensures that you receive tailored solutions to address your specific risk profile. By partnering with us, you can effectively address these five key risk areas while maintaining operational efficiency and be well positioned to combat the current industry challenges.   Contact Cottingham & Butler today  to learn how we can help your trucking company navigate these risks and drive towards a secure and prosperous future.

If you're a business owner, HR professional, or CFO, you understand the complexity of today's workforce demands. From rising compensation expectations to evolving benefit needs, creating an effective total rewards strategy has never been more challenging - or more crucial for your success. In this session, we'll show you practical ways to enhance your total rewards program without breaking your budget. We'll cut through the complexity and share what's really working in today's competitive market. You'll learn about: The latest trends shaping employee expectations Methods to maximize your benefits offerings How to get to the root of what today's employees truly value   Ready to transform your total rewards program? Watch now!

In today's challenging economic climate, HR leaders face a critical balancing act: managing rising healthcare costs while maintaining competitive benefits that keep employees happy and engaged. If you're struggling with this dilemma, you're not alone. In this session, we share 10 proven strategies that can help you reduce healthcare expenses without driving away your top talent. Following overwhelming feedback on this topic from this year's seminar series, we're excited to share this practical framework that puts both your budget and your employees' wellbeing first. You'll discover innovative approaches like: Smart risk transfer strategies that can significantly reduce your healthcare burden Creative ways to improve employee health outcomes Methods to optimize healthcare utilization without compromising care quality Practical cost-sharing solutions that work for everyone   Watch below to unlock the ten strategies that could transform your benefits program.

In the ever-evolving world of transportation insurance, staying current with regulatory requirements is crucial for both brokers and their clients. While this regulatory requirement might not be a daily consideration for most transportation companies, its importance cannot be understated. As our transportation practice continues to grow, we're seeing an uptick in questions about MCS-90 endorsements and their applicability to various operations. See below for key takeaways from a recent training with our trucking safety expert at SMSC: Accessibility of information: There is a straightforward online portal where you can search by company name or DOT number to determine filing requirements – a process that takes seconds. To look up motor carrier number, click here: SAFER Web - Company Snapshot To check if a filing has been made: Licensing & Insurance Carrier Search Practical Application: Understanding when and how MCS-90 applies to different operations isn't just about compliance – it's about protecting your business. Our team is equipped to help clients navigate these requirements efficiently.   At Cottingham & Butler, we believe in making complex regulatory requirements more digestible for our clients. Whether you're dealing with MCS-90 endorsements or other transportation insurance needs, our team of specialists is here to help guide you through the process. Our team has access to detailed reference guides and expert resources to help answer your specific questions about MCS-90 requirements. We understand that while these requirements might not affect every operation, having the right information when you need it is crucial. Contact your Cottingham & Butler representative today to discuss your specific needs and ensure your operation is properly protected.

Undergoing compliance investigation is a source of apprehension for any motor carrier. The implementation of changes and safety measures has made an FMCSA compliance review investigation visits particularly daunting for trucking operations. Please join us as we delve into the intricacies of the FMCSA review process and present best practices for preparedness and compliance to ensure a successful investigation.   LEARNING OBJECTIVES Why Motor Carriers are selected for a compliance investigation? Understanding the various types of compliance investigations, such as roadside inspections, compliance reviews, and focused investigations. Explore the seven "BASIC" Behavior Analysis and Safety Improvement Categories, including unsafe driving, hours-of-service compliance, and vehicle maintenance.  Stay informed about upcoming changes with the Drug and Alcohol Clearinghouse, including regulations and reporting requirements.  Gain insight into the investigation process, including how violations are identified, documented, and addressed. Click here to download the presentation.

In the world of personal insurance, finding the right balance between comprehensive coverage and affordable premiums can be challenging. We recently had the opportunity to help a family overcome this exact dilemma. Our team worked diligently to restructure their insurance portfolio, resulting in increased protection and decreased overall costs.   The Situation Our clients, a family with significant assets, found themselves in a precarious position. Their existing insurance coverage was inadequate, particularly in terms of liability protection. Their coverage limits didn't align with their net worth, leaving them exposed to potential financial risks.   Our Approach After a thorough assessment of the family's situation, we identified several key areas for improvement: Liability Coverage : We recognized the need for a substantial increase in liability protection. Home Insurance : The existing home insurance policy required significant adjustments. Auto Insurance : We saw an opportunity to optimize the auto insurance strategy. Emerging Risks : In today's digital age, we identified a gap in protection against cyber threats.   The Results Our team implemented a comprehensive strategy that addressed all the family's insurance needs: Added Umbrella Policy : We introduced a robust umbrella policy providing $10,000,000 in personal liability coverage. This policy also included $2,000,000 of uninsured and underinsured motorist coverage, offering an extra layer of protection. Increased Home Insurance : We boosted the home insurance coverage by 150%. The new policy includes guaranteed, unlimited rebuild coverage, ensuring the family's home is fully protected regardless of future construction costs. Restructured Deductibles : We realigned the deductible strategy for both home and auto insurance to better match the family's risk tolerance. This adjustment played a crucial role in optimizing their overall insurance costs. Personal Cyber Crime Coverage : Recognizing the growing threat of cyber-crimes, we added coverage up to $100,000 to protect against digital risks.   The Outcome: Enhanced Protection at Lower Costs By strategically increasing the family's risk assumption at lower levels, we were able to significantly enhance their protection against catastrophic losses. The restructured portfolio now offers superior coverage across all areas, particularly for high-impact events that posed the greatest financial risk.   The most remarkable aspect of this case? We achieved all of these improvements while simultaneously lowering the family's overall insurance costs.   Our commitment at Cottingham & Butler to providing tailored, comprehensive insurance solutions that protect our clients' assets and peace of mind, all while optimizing their insurance spend.

In the complex world of personal risk management, families with multiple properties often face unique challenges. Recently, our team at Cottingham Butler had the opportunity to assist a family in this exact situation, dramatically improving their coverage while significantly reducing their premiums. This case study showcases how strategic adjustments can lead to superior protection at a lower cost.   The Situation Our clients, a family owning multiple homes, came to us with a common but critical issue. Their existing personal risk management plan was inadequate, characterized by: Low deductibles across their policies Insufficient liability limits Gaps in coverage for modern risks This combination left them vulnerable to both minor claims and catastrophic events, while also paying higher premiums than necessary.   Our Approach After a comprehensive review of the family's risk profile and existing policies, we identified several key areas for improvement: Deductible strategy Liability coverage Protection against emerging risks Overall cost efficiency The Results Our team implemented a multi-faceted strategy to address all aspects of the family's insurance needs: Restructured Home and Auto Deductibles : We adjusted the deductible strategy for both home and auto insurance policies. By aligning these with the family's true risk tolerance, we created a more efficient risk transfer mechanism. Enhanced Umbrella Policy : We significantly increased the uninsured and underinsured motorist coverage limits in their umbrella policy to $10,000,000. This substantial boost provides crucial protection against high-impact events involving uninsured or underinsured parties. Added Personal Cyber Crime Coverage : Recognizing the growing threat of digital crimes, we incorporated personal cyber-crime coverage up to $50,000. This addition protects the family against a range of modern risks that traditional policies often overlook. Optimized Overall Insurance Costs : By strategically increasing the family's risk assumption at lower levels (through higher deductibles), we were able to secure much higher coverage limits for catastrophic risks. This rebalancing not only improved protection but also resulted in significant cost savings.   The Outcome: Enhanced Protection at Lower Costs The most remarkable aspect of this case is the dual benefit we achieved: Increased Coverage : We substantially improved the family's protection, especially against high-impact events that posed the greatest financial risk. Decreased Premiums : Despite the enhanced coverage, we managed to lower the family's overall insurance costs by an impressive 33%.   Our approach of increasing risk assumption in areas where the client can comfortably self-insure allowed us to secure much more robust coverage for truly catastrophic events. This not only provides better protection but also often results in overall premium savings.

In the world of high-net-worth individuals, insurance needs can be complex and multifaceted. Recently, Cottingham & Butler had the opportunity to assist the founder of a prominent last-mile transportation service in optimizing their personal insurance portfolio. This case study demonstrates how a thorough review and tailored approach can lead to significantly improved coverage and risk management.   The Situation Our client, a successful entrepreneur in the transportation industry, approached us with a seemingly straightforward request: to remove their personal vehicles, some of which were high value, from their commercial insurance program. However, as our team delved deeper into their overall insurance picture, we uncovered several critical issues: Absence of Personal Umbrella Policy : The client lacked a crucial layer of protection against potential liabilities. Underinsurance on Multiple Properties : Several of the client's properties, including personal residences and rentals, were significantly underinsured. Non-Optimized Claims Reduction Strategy : The existing insurance approach hadn't been structured to minimize the risk of claims, leaving the client exposed to unnecessary financial risks. th minor claims and catastrophic events, while also paying higher premiums than necessary.   Our Approach Recognizing the complexity of the client's needs, our experts sprang into action. We leveraged our extensive market knowledge and network to craft a comprehensive solution. Our approach focused on: Consolidating coverage across multiple properties Introducing robust liability protection Implementing loss prevention strategies The Results Our team successfully negotiated a comprehensive package that addressed all of the client's needs and more: Comprehensive Property Coverage : We consolidated insurance for all personal and rental properties into a cohesive program. This not only simplified management but also unlocked previously untapped discounts. $5 Million Umbrella Policy : We introduced a substantial umbrella policy, providing an additional $5 million in liability coverage. This extra layer of protection is crucial for high-net-worth individuals who may be at greater risk of lawsuits. Loss Prevention Optimization : We identified and implemented various loss prevention measures. These not only reduced the likelihood of claims but also qualified the client for additional discounts. Customized Vehicle Coverage : We successfully transitioned the client's personal vehicles, including high-value cars, off the commercial program and onto a more appropriate personal auto policy. Action Plan for Claims Reduction : We provided the client with a detailed action plan designed to further reduce the chance of claims. This proactive approach not only offers greater peace of mind but also translates into additional premium savings.   The Outcome: Enhanced Protection at Lower Costs By taking a holistic view of the client's insurance needs, we were able to transform a simple request into a comprehensive risk management solution. The client now enjoys: Consolidated and optimized property coverage Robust liability protection with a $5 million umbrella policy Appropriate coverage for high-value personal vehicles A proactive claims reduction strategy Multiple sources of premium savings through consolidation and loss prevention   This case exemplifies Cottingham & Butler’s commitment to thorough analysis, tailored solutions, and ongoing risk management. By addressing not just the immediate need but the entire risk landscape, we provided our client with both enhanced protection and optimized insurance costs.

As we continue to navigate the ever-changing environment of the trucking industry, growing influence of nuclear verdicts on traditional insurance markets is not going unnoticed. These high-stakes legal outcomes are reshaping the way carriers and fleet operators approach risk management. To help your business stay ahead of the curve, the following key insights can guide your operation in making informed strategic decisions about your insurance solutions moving forward: Soaring Nuclear Verdict Severity and Frequency: Recent studies have found that there are 3 times the number of verdicts than there were a decade ago, and verdicts have increased by 867%. In recent years, we have seen a surge in "mega" verdicts exceeding $100 million, while the median nuclear verdict has climbed to $21 million. Product liability cases, have experienced a staggering 50% increase over the past decade, peaking at $36 million in 2022. This trend reassures the need for tailored insurance coverage options to prepare your business for the growing risk of extreme nuclear verdicts. Post-Pandemic Rebound of High-Stakes Verdicts:  While the COVID-19 pandemic temporarily suppressed the frequency of nuclear verdicts, a quick return of high-stakes verdicts has returned, reflecting pre-pandemic levels by the third quarter of 2021. These rapid rebounds highlight the importance of flexible insurance strategies that can quickly adapt to shifting legal environments. Insurers are now encouraged to reevaluate their underwriting approaches and pricing structures to account for fluctuations in verdict trends. Decade-Long Trend of Increasing Verdicts : Looking beyond the pandemic years, an upward trend in nuclear verdicts has occurred at all levels over the 10-year study period. This persistent climb emphasizes the growing necessity to protect businesses against the rising tide of substantial legal verdicts. Choosing the right insurance partner is crucial, given the increasing frequency of nuclear verdicts that could be a threat towards your business. Our team at CBCS, Cottingham & Butler’s in-house third-party claims administrator, is using 4 innovative strategies to combat this trend: First Call Settlement Programs : Rapidly resolving potential claims, often within hours, significantly reducing costs. Nurse Case Management:  Ensuring appropriate medical care while protecting clients from inflated costs. Internet Mining & Surveillance:  Uncovering crucial evidence to support fair outcomes and challenge fraudulent claims. Commercial Auto-Focused Predictive Analytics:  Our model has reduced settlements by an average of 40% on flagged claims. These strategies are helping our clients navigate this challenging landscape, often resulting in substantial savings and fairer outcomes for all parties involved.   By working with Cottingham & Butler, you'll benefit from our industry expertise, supporting you in potentially reducing expenses and minimizing operational disruptions. This approach not only provides stability for your insurance needs, but also provides valuable insights to boost fleet safety and efficiency. Turn your insurance program into a strategic advantage, supporting your business’s sustained growth and stability in an ever-changing landscape. Contact Cottingham & Butler today  to learn how we can help your trucking company navigate nuclear verdicts and stay ahead of the curve.

Business interruption insurance can offer much-needed financial protection when an organization’s usual business activities are disrupted by covered perils (e.g., fires, theft, vandalism, heavy wind and hailstorms). Sometimes called business income insurance, this form of coverage can be purchased as a supplement to commercial property insurance or secured through a business owner’s policy—a bundled insurance package featuring property and liability coverage.  The amount of business interruption insurance an organization needs varies based on its industry, operations and risks. To ensure ample coverage, an organization should work with trusted insurance professionals to calculate its business income exposure. An important consideration for determining this exposure is the estimated maximum loss of business income (EML). This value refers to a projection of the largest possible loss an organization may incur from a covered peril under a specific policy. By calculating an accurate EML, an organization can secure a business interruption policy tailored to its unique risks and minimize out-of-pocket costs when disaster strikes.  Several factors must be considered during EML calculations. This article outlines key components an organization should keep in mind when determining this value.  Business Income Worksheet  Calculating an organization’s EML starts with completing a business income worksheet. This form, which is typically provided by the organization’s insurer or available through Insurance Services Offices Inc., helps estimate annual business income for the upcoming 12-month policy period, thus providing the information needed to select an appropriate coverage limit (the maximum amount that the insurer will pay toward a claim). Utilizing this worksheet requires an organization first to determine its business income for the last 12 months with historical data compiled from the past year’s financial records. Relevant data includes the organization’s total revenue for the year, annual expenses and operating costs, and taxes. With this data, an organization can leverage the following equation for business income:  Subtract annual expenses and operating costs from total revenue to calculate the year’s earnings before taxes. Deduct taxes from the previous amount to determine annual net income. This number is equivalent to the year’s business income.  Upon calculating its business income for the last year, an organization can use this number as a baseline to estimate its business income for the next 12 months. This value could be similar to the prior year’s business income, with some adjustments to reflect possible changes in the coming year (e.g., a projected increase in sales).  Non-continuing Expenses  Some of an organization’s expenses are fixed in nature, meaning they will remain constant even when business operations cease. Common examples of fixed costs are rent, interest payments and insurance premiums. Other expenses, however, may pause in conjunction with business disruptions. These costs, known as non-continuing expenses, may include various raw materials, certain utilities and specific components of payroll (e.g., salaries for hourly employees). By identifying non-continuing expenses, an organization can detect areas where it could experience reduced costs during business disruptions, paving the way for more accurate EML calculations and potential savings. Period of Restoration  One key factor in determining the overall value of any business interruption-related loss is the period of restoration, which refers to the total length of an operational disruption. In most cases, the period of restoration is measured from the start date of a loss (e.g., when property damage occurs) until the affected organization fully recovers (e.g., when property repairs are completed). As it pertains to EML calculations, an organization needs to consider the maximum anticipated period of restoration for a covered peril. This period can be determined based on a range of elements, such as the type and scope of property damage that could be inflicted and the average rebuilding time for such damage. Because the recovery process for a business disruption can vary, it’s also important for an organization to add some extra time to its maximum anticipated period of restoration, establishing a safety net in the face of unanticipated delays. Peak Periods  An organization will likely experience fluctuations in revenue and profits throughout a given year based on consumer trends and seasonal patterns. For example, a retail company that primarily sells beachwear and swimming apparel probably makes more sales in the spring and summer months than in the latter half of the year. These high-performing months, often referred to as peak periods, must be considered during EML calculations. After all, a business disruption that occurs during a peak period carries more severe consequences and ultimately generates a larger loss than a disruption that takes place in the off-season. As such, an organization should be sure to take peak periods into account when conducting EML calculations and consider the additional impacts of business disruptions during these critical times.  Extended Business Income Loss   Even after the period of restoration ends and property damage from a covered peril has been fully repaired, an organization may need more time to resume its normal operations and start generating its usual business income. In other words, there could be a brief adjustment period between an organization’s property being restored, operations reaching their expected volume and customers returning to the business. During this time, the organization may continue to experience negative impacts on its revenue and profits; this is called extended business income loss. With this in mind, it’s imperative for an organization to factor extended business income loss into its EML calculations by carefully estimating the amount of time it will take to resume typical operations and regain support from its original customer base. Above all, this estimate should allow for gradual revenue and profit recovery rather than an immediate shift to business as usual.  Anticipated Changes in Costs and Profits   In some cases, a business disruption may occur in between policy periods. For example, a covered peril could take place days before an organization’s business interruption policy renews, with the period of restoration extending into the following policy period. These scenarios can pose challenges for EML calculations, as an organization’s business income can easily fluctuate between policy periods and, subsequently, generate different EMLs. This issue is especially prevalent if an organization is currently undergoing or planning to make significant changes to its operations. In light of these scenarios, it’s best for an organization to consider the possibility of a business disruption spanning policy periods when conducting EML calculations, therefore anticipating any changes in operating costs and profits throughout the period of restoration and ensuring its coverage accounts for these potential variations.  Extra Expenses   Depending on the nature of a business disruption, an organization may be able to continue some or all of its normal operations during the recovery process by utilizing an alternative location and renting essential tools and equipment. Although doing so can help the organization minimize the overall impact of the disruption and expedite its recovery, this also comes with extra expenses, such as temporary lease payments, utilities for the alternative property and marketing efforts to encourage customers to visit the new business location. If an organization plans on continuing its operations in this manner after a covered peril, any anticipated extra expenses stemming from such plans should be reflected in its EML calculations.  Potential Errors   Business disruptions are often hard to predict and can range in severity. As a result, errors are always a possibility in EML calculations. If these errors cause an organization to underestimate its EML, they could prompt underinsurance concerns and lead to substantial out-of-pocket expenses following a covered peril. That’s why it can be valuable for an organization to consider a variety of contingency factors (e.g., construction setbacks, broken supply chains, adverse weather and incomplete recovery plans) during EML calculations and regularly review and update these calculations. Additionally, it might make sense for an organization to increase its EML by a set percentage to compensate for any remaining errors and further mitigate the risk of underestimates.  Coinsurance Requirements   A coinsurance clause, which is included in many commercial insurance policies, requires a policyholder to maintain a minimum amount of coverage. If the policyholder submits a claim and an inspection reveals that their coverage doesn’t meet the minimum amount, the insurer will penalize the policy holder by paying a reduced percentage of the claim. When purchasing business interruption insurance, an organization should make it a priority to secure a policy limit that matches either its EML or the minimum amount of coverage required by the coinsurance clause—whichever value is higher. If an organization neglects to address this clause, it could be more vulnerable to coinsurance penalties and face considerable financial challenges amid business disruptions.  Conclusion  Business interruption insurance is an essential form of coverage that can make all the difference in helping an organization successfully navigate disruptions and minimize the fallout from these events. Understanding the primary factors involved in EML calculations and coordinating with trusted insurance professionals to ensure accurate projections can equip an organization with the knowledge and resources needed to purchase sufficient business interruption coverage, create a more personalized policy and avoid potential underinsurance complications. Contact your Cottingham & Butler Representative today.

The transportation industry is an industry unlike any other. According to the U.S. Department of Labor, Bureau of Labor Statistics, truck and delivery service drivers accounted for more than 70,000 workplace injuries and illnesses in a single year. Truck drivers have been working remotely before working remotely was a thing. This is why carriers must provide the utmost focus and training in ensuring that their drivers are safe beyond just when the wheels are turning. There are multiple key areas where a driver is at risk of injury when moving inside and outside the cab of the tractor.   This webinar dives into key areas and provide best practice measures that a carrier can consider in keeping their drivers safe while out there on the road.   LEARNING OBJECTIVES: Inside Cab Safety Entering/Exiting Fifth Wheel Release Landing Gear Tandem Release Opening/Closing Trailer Doors Click here to download the presentation.

Construction contracts are fraught with risk. Contract Sums are high, and potential liability for each and every project is higher still. Finding a way to reduce your risk by making changes acceptable to the other side often seems like an impossible task.   In this webinar, Eliot Wagonheim, construction attorney and founder of First Rule Contract Training , will guide you through 5 small changes with big, bottom-line impact.   Why small? Because drowning the other side in a sea of red ink won’t get you where you need to be.   Why these changes? Because your company doesn’t benefit from legal nit-picking. What your company needs is maximum protection and optimized profit.   LEARNING OBJECTIVES: How to Revise the Change Order provision to eliminate your risk of non-payment (even for unsigned change orders) What that indemnification language really means and how to reduce your risk by making small, but significant changes Why “boilerplate” Lien Releases can hurt your bottom line, and what you can (and should) do about it. How to close the huge, but often unseen, warranty gap that could cost your company thousands of dollars…or more The one change that will enable you to sign off on a contract that ties you to a Project Schedule…even when the schedule is out of date or not attached at all. Click here to download the presentation.