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Operational Efficiencies and Professional Due Diligence Saves Millions
By Lina Demedieros
What is the success of any transport company? Operational Efficiencies, Cost Model Mangement, Quality Human Resources, Compliance, proper administration of benefits.
When talking operation efficiencies and cost model management insurance is a biggy. However, many times the surface of these complexities are merely scratched. To date many transport carriers understand the very systems in play today may create the largest liability . The largest risk takers are the general insurers, secondary is group disability for employees and individual plans for contractors, lastly WSIB. Proper administration and profressional due diligence protects all parties irrespective of the relationship.
SELF INSURED WATCH OUT
Many self-insured fleets who mandate clearance certificates later learn that their Owner Opeators are NOT properly protected but will a association plan eliminate any potential liability? The answer NO. Aggregate limits, Contracts that are biased hurt the transport carrier cost carriers millions irrespective or the relationship. Association plans were an excellent idea for many years ago before Canada started to follow suit and sue, sue, sue in the face of advertisity. The key professional due diligence.
Last year and this year I heard many carriers complaining and comtemplating alternatives to WSIB, currently being sued by an Owner Operator for a association plan mandated or simply suing the carrier as a result of NOT having any benefits in place. Many times they choose to provide cost effective, simple solutions that later turned around and cost them hundreds of thousands by simply overlooking the very elements of their contract that could later come back. The argument is always that a lawyer stated that the contract was fool proof. However, in a market that fuel costs are on the rise, the burden resting with the Owner Operator as price wars on the cost of hauling goods. It is NOT surprising management focused staying their current belief system and prolonging the one very thing that could haunt them “THEIR CONTRACT and ADMINISTRATION OF BENEFITS”.
What surprised me each time I heard these complaints that nobody ever thought of where liability rested each time that this happened. “Professional Due Diligence”.
The reason why the transportation industry has had problems every since an independent owner operator could maintain this status representing one carrier; no professional due diligence was exercised by the person providing the alternative.
What is due diligence. Insurance advisors who are brokers representing several carriers, specialized in this field know what it means, provide the client with options in the market, sign off, sign off and presto. All parties to contract are protected in the event of litigation. However, the operational hurricane preceded due diligence, later costing many transport companies thousands and all it took was just a few more minutes for the advisor and client to decide on making a difference. This difference, creates a harmonious work environment and no re-course to the transport carrier. Now this is operational efficiency.
For more information contact Lina at www.lmdfinancial.com
Lina M. Demedeiros
President
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