Question
I write a fair amount of transportation insurance in MI and have had a recent battle with several insurers over a motor carrier with common/contract authority who also has brokerage authority under the same name and filing number.
Can any of the learned individuals out there show me any case law or give me a good argument as to the means a brokerage could be providing primary liability to another motor carrier if the authorities are done as described above?
Your replies are appreciated.
Patrick Green
Vice President
Acordia
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Answer
You might also ask your question in the Trucking 101 forum. I know Mel does authority issues also.
Good luck on finding the answer, cause I sure don't know!
Monty
Answer
Pat,
I was told that when we get the brokerage authority, that we have to have a completely separate company, including different MC numbers, or we couldn't afford insurance, even if we could find it somewhere.
Check with Connie, she knows the details.
HJ
[This message has been edited by Honestt John (edited April 19, 2000).]
Answer
Pat,
Many of the truck insurance companies do not want the exposure of the brokerage under the motor carrier as they are not getting premium for it and could easily be brought into a lawsuit. Keep in mind the brokerage operation has little if any control on the motor carrier and many brokers never verify the proof of insurance provided by motor carriers.
For a number of years now, I've recommend to my clients to have two separate corporations. For their benefit as well. The assets are then separate and distinct.
In the case of a lawsuit it is not 100% foolproof, but it sure does make the insurance companies happy.
Connie
Answer
I posted a reply on the law forum