Limit Your Liability — Before Accidents Happen

Accidents happen — always, of course, when you least expect them. And we’ve all heard about at least one liability lawsuit that ended with the jury awarding sky-high monetary damages to the plaintiff. In fact, fewer than one-third of liability claims end up in court, and less than 2 percent actually are decided by a judge or jury. Most liability lawsuits are settled out-of-court by the defendant’s insurance company. But school bus operators can’t only rely on the industry’s extraordinary safety record to carry the day. There are still plenty of crafty attorneys and accommodating juries willing to "send a message" at the first sign of complacency.

Identify your loss areas
It sounds a little crass — worrying about money, when children’s safety is at stake — but any safety-related effort, whatever the motivation, will necessarily result in greater passenger safety and a more favorable "loss experience." And that’s the bottom line — your fleet’s past history — when the insurance company calculates your liability insurance premiums. Loss experience also is a good place for transportation supervisors to begin looking for places to lower those premiums. For example, "Any training that a company has is reflected in their loss experience," says Michelle Silvestro, broker marketing manager at National Interstate Insurance in Cleveland. "I can look at it and tell because the accidents fall in certain categories, like backing or lane changes." Reflecting on your loss experience can uncover equipment problems as well. When the Columbus (Ohio) Public Schools noticed that 85 percent of its accidents involved fixed objects, Transportation Supervisor Dave Samuel tracked the problem to improperly adjusted mirrors. The district is now installing mirror stations to ensure proper adjustment. Mirrors are only one part of the Columbus district’s eight-year effort aimed at lowering the fleet’s insurance premiums. Two of Samuel’s driver-trainers have been trained in advanced accident investigation at the Ohio Police Academy, another is authorized to perform CDL training and certification and all compound supervisors are certified doppler radar operators who periodically monitor buses on the road. The result: Samuel says the fleet’s insurance premiums are now 80 percent lower than they were a decade ago.

Get ahead of the curve
Premiums and legal liability are intertwined. The same steps aimed at lowering your insurance premiums can also be persuasive evidence that an accident was just that — an unforeseeable event and not the result of negligence. "Negligence is an issue that is viewed by a comparison of peers," says John P. Cruden III, an insurance broker for Insurance Systems Unlimited in San Francisco. "If you’re the only one that does a procedure ‘A,’ and everybody in your local area of the same size operation does it ‘B,’ if that procedure causes injury you will be perceived as negligent because you don’t do it as your peers." Better, says Cruden, to adopt the industry’s "best practices." For example, there’s no law requiring school bus drivers to walk to the back of the bus and check for sleeping children. However, checking the bus is a widely accepted best practice. If drivers aren’t required to double-check for sleeping children, a jury is going to be justifiably skeptical of an operator who disregards the practice. So perception, in many instances, can be your friend, bolstering the perception that your operation takes safety seriously. But don’t expect a jury to take your word for it. Detailed, comprehensive and up-to-date records will carry much greater weight.

Create a clear paper trail
"‘Meticulous’ is the word that always comes to my mind," says Jim Ellis, transportation supervisor at Seneca Falls (N.Y.) Central School District. "Having a paper trail showing that you have made a reasonable effort to prevent accidents." Even with the most minor incidents, Ellis says, the documentation should be as thorough as possible. The driver should receive some retraining, and the retraining should be documented as well. Even a minor oversight can be made to look like a major catastrophe in court, says Ellis, who has testified as an expert witness at numerous trials. "My experience in court has been that the attorneys on the other side discover these minor incidents that were swept under the rug perhaps, and use that incident against the school district or bus company to show that this was a foreseeable event." Protecting yourself requires more than merely complying with the existing state regulations, he adds. You also need to be aware of what everyone else is doing. Ellis offered crossing gates as an example. If all the buses in your area are equipped with gates, you don’t necessarily need to install crossing gates on your buses. But it would be wise to investigate their advantages and disadvantages for your fleet. At a minimum, be able to offer proof that you had not ignored their use.

He said, she said
Unfortunately, vehicle safety is not the only consideration. School bus fleets must remain vigilant against other types of liability as well. Mike Tennery, a risk control consultant for the Coregis Insurance Group of Chicago, recalls "a couple of districts where the drivers are older women and they give a couple of the kids a good morning kiss. I keep telling them they are wide open liability-wise." Tennery, whose clients include school districts in the Northwest, says issues surrounding driver behavior, like child abuse and molestation, and employer/employee relations have received more attention from insurance companies in the past few years. "There’s a lot of educational effort in that area," he says. "It used to be, ‘This is how you get the bus down the road.’" National Interstate’s Silvestro also emphasizes the importance of tackling those issues proactively, noting that there are insurance policies covering abuse and molestation, "but I can tell you that all of the major school bus carriers are not willing to write it." Thorough background checks are essential, Silvestro says, though "they are often overlooked because of the expense. "But you need to remain vigilant. When you start relaxing on that end, you’re going to lose on the other end," she says. Some districts, she adds, are instituting "no-touch" policies toward student riders, as insurance against abuse or molestation claims. Tennery says onboard cameras are also valuable in that regard. "If there is an occasion where a driver has to discipline a student in some way, it’s a wise idea to move back into camera range," he advises. Other liabilities, unrelated to vehicle safety but which can (and have) gone to court include: