In 2013, 32,719 people died in motor-vehicle traffic crashes in the United States.1 Work-related motor vehicle crashes (MVCs) are a leading cause of work-related fatalities. The Bureau of Labor Statistics data reflects 1,740 transportation fatalities in 2013. Three of five (991) were roadway incidents while 284 cases involved pedestrians struck by a vehicle, often in a construction zone. 2

Costs associated with motor-vehicle accidents such as vehicle repair and medical treatment are widely recognized. In addition to recognized costs, there are also insurance fees as well as costs that may fall outside of the responsibility of the insurer. While most work-related injury costs for the employee may fall under Worker 's Compensation (as an exclusive remedy), punitive damages associated with failure to manage fleet risk effectively, do not.

Punitive Damage Issues

Punitive or exemplary damages, as they are sometimes called, are financial damages awarded to a victim for conduct that fell far below an accepted standard of care and rose to the level of being reckless or deliberately indifferent to the safety of others. These standards and their definitions vary by state. In some states these awards are covered by insurance but in others they are not. Punitive damages costs are often above and beyond what is normally covered by insurance. If they are not covered by insurance the impact of their being awarded against a company can have a devastating effect. If an organization is not properly insured or otherwise funded, these costs can result in the financial ruin of the organization. It is also true that the larger and more wellfunded an organization is the more they are exposed to higher awards simply because they have greater assets.

The most common source of these claims are:

  • Negligent entrustment-this means your firm hired someone who did not meet acceptable standards. This may be because of personal medical issues, a history of poor driving performance that has led to sub-optimal driving record, or licensing such as having an improper class of license, expired or revoked license or similar issues.

  • Negligent retention- is similar to negligent entrustment but goes somewhat further in that you hired someone not qualified to operate the vehicle in the required. In addition, for whatever reason, you knew the problem existed and kept the person on the road driving your vehicle.

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