If there’s one thing trucking company executives and their insurance companies fear, it’s likely the “nuclear verdict.” A nuclear verdict is a massive judgment of $10 million or more, awarded to the victim or victims of a truck accident.
The problems with nuclear verdicts, as the trucking industry sees things, are that they’re expensive and rising fast. As the trucking site Freight Waves noted, the industry has seen a 300% increase in nuclear verdicts over the past seven years. That rise, in turn, has led to massive insurance premium increases. And most trucking companies are struggling to keep up. Many have had to shut down.
Why are nuclear verdicts on the rise?
To understand why we’re seeing so many more nuclear verdicts, it’s important to step back first for a look at the bigger picture. These verdicts represent a small fraction of all cases. Most truck accidents lead to settlements, but there are multiple parties involved, each with its own interests.
As Freight Waves noted elsewhere on its site, any of three parties could push a case to court:
- The attorneys representing the trucking company might think they can win a case. If so, they might refuse to settle for anything near what the plaintiff could find reasonable. In such cases, the nuclear verdicts may, in part, stem from the attorneys’ egotistical decisions.
- The insurance company may also refuse to meet the plaintiff on common ground.
- Victims may receive settlement offers that barely cover their medical expenses—or don’t cover them—and who don’t find their pain and suffering addressed at all. In these cases, they have little reason to settle, and their attorneys may advise them to push for trial.
Once a truck accident goes to trial, however, the trucking company and insurance company become vulnerable to the jury. And these juries have increasingly found that trucking companies and insurers have undervalued people’s lives. Accordingly, they’ve delivered a rush of these nuclear verdicts that has shocked the trucking industry.
Here’s how nuclear verdicts have helped improve the trucking industry
Nuclear verdicts are bad for the trucking industry’s bottom line. At least for now. They’ve prompted dramatic increases in the cost of insurance. But they have also spurred positive changes.
Trucking companies faced by the skyrocketing costs of insurance have found little choice but to work on improving their safety records. And insurance insiders have taken notice of these changes:
- Increased use of collision avoidance systems
- The installation of speed limiters
- Driver and dashboard cameras
- The adoption of tighter drug testing policies
- Greater focus on the hiring process
Of course, these changes all cost trucking companies more money, subtracting from their bottom line in the short term. However, increased safety is good for the industry in the long run, just as it’s better for society.
Are nuclear verdicts good for society?
The answer to the question of whether nuclear verdicts are good for society may lie outside the scope of this review. But it’s safe to say they’re forcing truck companies to take a second look at their safety policies and technology. That may only be one piece of the argument, but that piece is good. A trucking company that’s focused on safety is better than one that’s not.