If you're a Canadian operator who makes trips into the U.S., there's good news on the insurance front. As of August 2, the insurance you need to cross the border and operate in the U.S. no longer must be sold or fronted by a U.S. provider, thanks to a recent Federal Motor Carrier Safety Administration ruling.
Previously, Canadian operators needing to travel into the U.S. could only get the insurance from Canadian insurance providers that had entered into a "fronting agreement" with a U.S. insurer or directly from U.S. insurers (necessitating two policies: one for the U.S., and one for Canada). Now, Canadian insurers can provide the coverage directly.
The minimum liability requirements have not changed, but the new FMCSA ruling could save operators money as administrative costs decrease. Regulatory Impact Analysis (RIA) estimates that Canadian-domiciled coach operators and freight forwarders will save a total of $273 million will over 10 years, or approximately $30,000 per carrier over the same period.
One of the commentors to the FMCSA proposal had expressed concerns that Canadian buses could escape responsibility for damages in the U.S. The FMCSA responded that the "Canadian government and the insurance companies it regulates have demonstrated that they have the ability and willingness to honor their financial obligations without the need for any additional oversight."
For more information, visit http://www.fmcsa.dot.gov, and consult your Canadian insurance carrier.
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