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Assessing the Security of Your Substance and Hazmat Carriers

 

Carrier choice is frequently one of the hardest jobs for a logistics supervisor. There's a continuous conflict not only between price and quality, but also, security. The goal of this post would be to give guidance and some advice on the best way to assess the security of your Compound and Hazmat Carriers.

 

Why should you assess the security of your compound and hazmat carriers?

 

1.It Is the right thing to do. The great majority of businesses I Have worked with in the chemical industry are outstanding corporate citizens. They realize they can determine the impact of their business on society, the surroundings, and the security of general people. The right thing to do would be to make sure each trucking company that transfers a substance cargo has the same security ethos and has capable individuals to manage substances and dangerous goods correctly.

 

2.Due diligence. It is astonishing the risk of suits should be a reason behind moving folks to do the right thing. Yet, in The World Today, it's an important concern. There have been some major suits filed in the U.S. Where the shipper and the logistics business got dragged into court for the selection of carrier on their shipping. It just so happened the truck driver got into a major injury instead of surprisingly, had a poor safety record. The shipper and the logistics firm could not show due diligence in their selection of carrier. This special case was settled out of court, but the danger is real.

 

3.Risk Decrease. Insurance these days appears to be becoming more expensive by the minute. If you're able to reveal your insurance adjustor a system of reducing risk and assessing the security of your insurance companies, it may bring about lower premiums.

 

4.Price Decrease. Even a small spill or leak can cost thousands of dollars to clean up, as well as the lousy press and PR. In this light, saving $50 dollars on a dispatch in the rate looks like a lousy choice. Long term price reductions can be seen in decreased episodes, spills and clean-up if properly trained, handled and seasoned carriers are accustomed to transfer your chemical cargoes.

 

What should you be looking for in a Substance and Hazmat Carrier?

 

1.Safersys Evaluation. safersys.org will have an inspection and violation history for your insurance company (assuming they're licensed for the US). This is an excellent site with lots of exceptional data on insurance companies including: insurance, years of operation, Out of Service Reviews, violations, injuries and any security audits which were done. Soon, (hopefully before the end of 2010) CSA 2010 data and security advice should be made public. This is a brand new system to score and monitor the security of carriers.

 

2.Insurance. Most folks aren't conscious that there are statutory minimums for insurance coverage in order to get/maintain your Motor Carrier permit.

 





$750,000 for General Commodities (nonhazardous)

$1 Million for dangerous except type A & B explosives

$5 Million Class A & B explosives, Hazardous materials transported in given capacities in tanks or hoppers (usually bulk cargoes) and/or any amount of hazardous materials as specified in 49 CFR 173.403 of the Federal Motor Carrier Regulations.

$300,000 for general commodities except any substances listed below

$5 Million Any amount of Class An or B explosives, for any amount of Poison Gas (Toxin A) or highway route controlled quantity of radioactive materials.

Common Carriers: Must take minimum liability as listed above plus $10,000 freight insurance.

Agent Authority: Agents must maintain a surety bond or trust fund in the sum of $10,000.

Furthermore, you should check on freight accountability. How much coverage do they have and what's the deductible?

 

 You should have a regular practice of appraising an insurance company's policies and procedures around security. For example:

 

Does the insurance company have a written security policy?

Can they supply WSIB Clearance Certificates (if based in Ontario)?

Do they run background checks on drivers at the time of hire?

Does their driver training program contain security and safety training?

Do they have an injury investigation process set up?

Do they have a preventative maintenance program in position?

Are they FAST, CTPAT or PIP approved?

Do they've corporate security policy?

How do they monitor and manage breaches for their drivers?

Are their motorists TDG trained?

Are their motorists WHMIS trained?

Do they've a policy that is texting?

As a closing idea, your carrier review procedure should be risk based. As an example, you may select to review a carrier's safety fitness more frequently for carrier who transfers your Class 6.1 cargoes and less frequently for non hazardous carriers. Bear in mind though that danger increases both with the substance transported and the frequency. For instance, a drum of Class 6.1 - Toxic that sends once per year would be less of a threat (ie: less demand for a regular security review) than a day-to-day truckload cargo of a Class 3 -Flammable Liquid. Even though a Class 6.1 is a more dangerous stuff.

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