California Bus Crash Draws Attention to Insufficient Minimum Insurance Requirements

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While the media has focused on trucking and bus insurance issues frequently over the past few months, far too much of the coverage has been premised on trucking companies as the victim. In reality and as set forth in one of our previous blog posts, systemic safety failures in the trucking industry are chiefly to blame for increased premiums and insurers exiting the market. Systemic safety oversights like failing to perform required maintenance, violating hours of service rules, and utilization cell phones and electronic devices frequently play a role in causing the types of accidents and incidents that can cause insurance premiums to soar.  

However, the aspect of these accidents and insurance regime that never seems to get the attention it deserves is how the current federal insurance mandates can often fail to provide for adequate coverage when an accident does occur. Thus, at least in part due to the “nuclear verdicts” caused by industry-wide, systemic safety problems, it now appears that federal minimum mandatory insurance requirements are no longer sufficient to cover the injuries caused in bus or truck accidents.

Bus Driver Did Not Brake prior to Slamming into the Back of a Tractor-Trailer

The recent passenger-carrying bus crash in California that killed 13 people and injured at least 30 more illustrates both how systemic industry failures contribute to causing accidents and how minimum required insurance coverage often fails to provide adequate compensation for accident victims and their family.

In this particular incident, the events that transpired seem to closely replicate those in the Walmart truck accident on the New Jersey Turnpike that severely injured comedian and actor Tracy Morgan and killed comedian Steve McNair. Here, the lead vehicle, a truck, was creeping along the highway at roughly 5mph due to traffic caused by roadwork. Like in the previous accident, the speeding trailing vehicle, a passenger bus traveling at up to 65 mph in this case, slammed into the rear of the truck. The driver did not appear to see the stopped traffic ahead in this instance because he did not brake prior to the collision.

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While the exact factors that led to the driver’s lack of attentiveness or even loss of consciousness have not yet been determined, there are typically a few reasons that are frequently behind incidents of this type. First, hours of service violations can frequently lead to fatigued drivers. In this case, a hours of service violation is a possibility. Although, leaving Los Angeles at 8 p.m. and returning less than 12 hours later would have kept the driver in compliance, it is unknown whether he had engaged in any on duty time that would have pushed him beyond limits prior to the accident.

Two other factors that frequently play a role in apparent loss of driver attentiveness or consciousness scenarios include the presence of medical conditions like sleep apnea and the use of cell phones and electronic devices. Commercial motor vehicle operators may be less than forthcoming during medical exams that can lead to their disqualification from their livelihood. Furthermore, at least some drivers may use handheld electronic devices to stay in touch with dispatchers or to distract from the typically monotony of late night highway driving despite federal rules prohibiting this practice.

Reports Also Indicate that Bus Tires were Worn and Vehicle Should Have Been Taken Out of Service

Other safety concerns regarding the sufficiency of maintenance on the vehicle also has investigators seeking answers. At a news conference, Earl Weener, an NTSB board member, stated that “Based on tire conditions, the vehicle was out of compliance with Commercial Vehicle Safety Alliance inspection criteria, and it could have been placed out of service.”

The data provided by FMCSA’s SAFER database does not reveal any obvious safety problems or a history of safety issues by the company USA Travel. However, the report does show that the only bus owned by the company was only inspected once in the two years prior to 10/26/2016. Although it seems that the company was in good standing with government regulators, an NBC News report shows that the company had likely experienced some issues previously. An NBC News investigation determined that the company owner had been sued following at least three separate highway collisions involving his bus company. While the company owner, Teodulo Vides was not the driver in these previous incidents, he was the driver in the recent fatal bus crash. Mr. Vides was one of the 13 individuals killed in the crash.

Apparently, at some point between his last inspection and the date of the accident, the tires on this bus became worn and deficient. According to an accident reconstruction expert interviewed by the Los Angeles Times one possible explanation in many possible deficient maintenance cases is the fact that,

In the commercial vehicle industry, there isn’t a lot of profit, and to make money you have to do something different than everybody else. You do your own maintenance or drive more hours than you should, or use your tires long[er]. If you can haul everybody to a casino for $5 a head and everybody else is charging $6, you’ll get all the business.”

While it is not yet known whether the worn tires player a role, or even if the driver attempted to apply the brakes, worn tires can significantly increase stopping distances and make a loss of vehicle control significantly more likely. The worn tires appear to be one additional factor that suggests that all required safety requirements and obligations

Why Are Federal Minimum Insurance Coverage Levels Insufficient to Cover Catastrophic Bus Accidents?

While the bus company obtained insurance coverage that met the $5 million federal minimum for bus companies, these level of coverage is increasingly insufficient. The reason that minimum insurance levels are set so low has much to do with Congress’s failure to adjust insurance levels set in the 1980s for inflation and changes in the industry. A 2014 FMCSA study determined that if insurance minimums had kept pace with the inflation rate and increased medical costs, the federal minimum would be set at about $21 million.

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Federal regulators have attempted to raise the minimums in the past, but insurance and trucking industry lobbying efforts have stymied these attempts. In 2014, FMCSA proposed an increase, but lobbying efforts have stalled these attempts despite the fact that FMCSA reports have found that the costs for severe and critical injuries can “easily” exceed $1 million. FMCSA’s attempts to address this gap in the trucking and busing industry safety regimes has now been moved to the inauspicious-sounding “long-term action” status.

This brings us back to the current accident in which 13 people were killed and 31 people were injured. Drawing from FMCSA’s determination that a severe or critical injury can “easily” exceed $1 million, let’s assume that each passenger’s injuries, lost wages, and other damages totaled to a mere $750,000 – 25% less than the level FMCSA found that can be “easily” exceeded. Thus a total of 44 injured bus riders compensated at $750,000 each would total to about $33 million.

If You Were Hurt in a Bus or Othr Vehicle Accident, Call a Philadelphia Personal Injury Lawyer

It is clear that the insurance policy held by the company will be insufficient. Furthermore, due to the bus company’s small size and the death of its owner, it is highly likely that many of the accident victims are their families will never be compensated adequately for their injuries or the death of a loved one. While Congress must account for the viability of small trucking and busing firms, creating a situation where paying customers who are injured in an accident are left with little to no recourse is clearly an unacceptable state of affairs.  When industry lobbying has resulted in an entire industry being underinsured, there comes a time when Congress and federal regulators must stand-up for the rights of people injured through no fault of their own.

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