Why NEMT Insurance Keeps Rising, and What Operators Can Control: Marc Crawford of Swan Insurance

Marc Crawford is Director of Transportation at Swan Insurance, with 18 years in commercial auto insurance. Swan, which he says stands for “sleep well at night”, is a brokerage that works only with companies whose vehicles move people or cargo, including fleet, NEMT and EMS operators. In this episode he talks with Jeff from Naveera about what NEMT providers need from their insurance, and what they can do about its cost.

Start with how you will get rides

Before Swan talks about placing a policy for a newer operator, Marc says, it holds a discovery meeting to understand the business: its goals, and above all where its rides will come from. A ride broker, private pay, managed care organizations or facilities each lead somewhere different. He wants operators to see their broker the way they see their accountant or their law firm, as a long-term partner rather than someone selling a policy.

Coverage that matches your contracts

There are two levels of compliance, Marc explains: what the state requires, and what your contracts require. In his California example, the state minimum for private pay falls well short of the $1 million a ride broker contract asks for, so the state limits will not be enough to work that contract. Facilities may require more still. At a basic level he lists four policies a provider needs to work with a ride broker:

• Commercial auto: auto liability if you hit someone, and physical damage to your own vehicle.
• General liability.
• Professional liability, which covers loading and unloading and the level of care for the passenger.
• Sexual abuse and molestation (SAM) coverage.

His advice is to work with a brokerage that specializes in transportation and understands NEMT, broker requirements and facility transfers. A generalist, he says, is a huge headache for operators.

Why rates keep rising

Marc says commercial auto as a whole runs at a loss: by his figures, carriers pay out about $1.37 for every dollar of premium. To keep writing NEMT they have to raise rates, and some have left. Where operators once had eight or nine carriers to choose from, he says, there are now three or four. Carrier profitability is out of an operator’s hands, but what happens in the operation is not. In his experience, the best operators see their rates flatten or fall as their fleets grow, while the rest keep absorbing increases of 10 to 15 percent a year.

A culture of safety

Cameras and spot audits help, but Marc argues they are not enough without a belief in safety that starts with the owner and reaches every driver: the passenger is the most important asset, drivers are on time and courteous, and driving is a career rather than a shift. He prefers spotlighting good driving over calling out bad, for example by using clips of drivers doing everything right in training, and having top performers mentor the rest. Drivers who do not improve have to be trained up or trained out.

What carriers see: loss runs

Carriers judge an operator mainly by its loss runs, a report of the past three years of claims, and that history weighs heavily on renewal pricing. When Swan did a deep-dive analysis, Marc says, a small group of drivers, around five to eight percent, accounted for about 85 percent of claims activity, and those drivers had stayed on too long. Frequent small claims, a fender bender in a parking lot or a curb clipped on a discharge, are driver-controlled, and on a long enough timeline they lead to severe ones.

Technology and the carriers

Swan builds what it calls a Swan Drive scorecard for its carriers, covering maintenance schedules, claims reporting, driver certifications and the last 90 days of telematics data, to show that an operator understands its own risk and is taking corrective action. Marc says cameras have gone from optional to effectively required in two or three years, and most carriers discount for at least a forward-facing camera, more for 360-degree coverage with stored footage.

Asked whether carriers credit onboard AI driver analysis or OBD-II vehicle data, Marc is candid: insurers move slowly, and most are well behind. Some program-specific carriers do welcome real-time data, and he expects the rest to get there in time.

Before you buy your first van

Marc’s last piece of advice is not about insurance. Decide whether you are building a lifestyle business you drive yourself, or a fleet you will manage, working on the business rather than in it. Then work out exactly how you will get rides: a direct relationship with a dialysis clinic, stretcher work for a facility, private-pay clients who want a concierge service, or ride brokers, and how many. Buying vans and getting insurance matters less, he says, than knowing where the rides come from.

And remember what the work is. A missed dialysis appointment can be life or death, so this is an extension of healthcare, not just getting someone from point A to point B.