Risky Roads

A business that depends on a fleet of vehicles to deliver its products or services to customers usually recognizes the risk that comes with driving from one place to another. To an organization that does not see movement as part of its main mission, however, the need to consider transportation liability may be less obvious. In today's litigious environment, ignoring or underestimating the level of risk involved with transportation can be a costly mistake.

Schools and universities, in particular, have multiple exposures that should not be overlooked by risk managers. These may include a football team with dozens of players and coaches that travels by bus to games, a simple excursion in which a teacher drives a student to a local event, or transportation outside the country for overseas programs.

By working closely with their risk-control experts, education institutions can take steps to make sure they are covered adequately whenever students or staff members are on the move.

Areas of risk

A few examples are useful in illustrating the wide range of transportation risks associated with schools and universities:

In March 2007, Bluffton University in Ohio sent its baseball team on the road to a tournament in Florida. The bus driver missed a stop at the top of an off-ramp in Georgia, turned too fast on the overpass, and flipped the vehicle onto the freeway below. The crash killed the bus driver and his wife, and five players; 28 teammates were injured.
The same year, two U.S. students attending an overseas program in Panama were injured seriously when the car they were riding in plunged off a winding mountain road.
In April 2008, a journalism student at Southern Illinois University was on his way to a photo assignment for the student newspaper when his car was rear-ended by a truck. He died in the resulting four-vehicle pileup.
In June 2008, five middle school students were injured when the bus in which they were riding home was rammed by a truck that did not stop at an intersection. Just five weeks before, the same bus — driving the same route with the same children — was hit by a vehicle whose driver died in the crash.

In cases like these, a school or university needs to be concerned about the legal aftermath. Liability for these and other types of accidents usually is sorted out long after the actual incident. But as institutions with relatively “deep pockets,” schools and universities can find themselves at the center of claims and lawsuits even when they take precautions and follow careful risk-minimizing steps.

Typically, a case for liability can be made from several perspectives. For example, if the school or university owns a vehicle involved in an incident, it is likely to be responsible, regardless of who is driving. Similarly, in terms of connection to the institution, if a student or an employee of the education institution — such as a coach, faculty member or administrator — is the driver, then regardless of who owns the vehicle, there could be some level of responsibility on the part of the institution.

In addition, when a non-education-affiliated driver, such as a parent, uses a private vehicle, there is still a case for liability if the destination is a school-sanctioned event. Even when a school contracts with a company, such as a shuttle service for on-campus or campus-to-town trips, the school still can be held accountable for the arrangements it has made in trusting the vendor to be responsible and safe.

Limiting risk

A 2006 insurance industry study identified motor-vehicle lawsuits as one of the top reasons that casualty costs are soaring for those found liable. Thirteen out of the top 100 lawsuit awards across the country in 2005 were attributed to decisions in vehicle crash cases.

On moral grounds alone, education institutions want to avoid having students and employees injured. Throw in the rising costs of liability, and it becomes imperative that schools and universities adopt practices to reduce risk from transportation. Some steps to consider:

Safe drivers. It is the institution's responsibility to examine the qualifications of those who will be driving on its behalf. Drivers should have appropriate licenses for the vehicles they are assigned; they should have a good driving record; and they should complete a safety-training course either as designated by or provided by the institution. In addition, universities should avoid having students as drivers. Because of the lack of experience and the statistically high rate of accidents for this age group, young drivers cannot be depended upon to react correctly in unsafe or challenging driving conditions. By having a careful vetting process in place, a school or university can demonstrate that it has taken appropriate care in handling its transportation driver responsibilities.
Safe vehicles. Properly maintained vehicles are much safer than those with worn tires and poor mechanical functioning, so it is important for any vehicles owned by institutions to be kept in good working condition. In addition, schools and universities should adhere to all federal safety guidelines, including recommendations for avoiding overloaded conditions, tire inflation standards and other safety factors. For those vehicles equipped with seatbelts, the institutions should require passengers to be buckled up before the vehicle is put into motion.
Qualified contractors. A school or university may choose to contract transportation services as one way of transferring liability. However, the institution needs to review the contractor's practices in terms of driver and vehicle safety to ensure its standards are met. The institution also should require proof that the vendor carries adequate liability insurance and names the school as an additional insured party.
Risk releases. In addition to ensuring that vendors are covered for risk, institutions also should communicate clearly about potential dangers and, when feasible, obtain informed-consent releases. Releases do not absolve institutions of responsibility, but they are an important documentation of the institution's good-faith effort to provide adequate warning about possible problems.
Appropriate insurance coverage. Because of the increasing cost of claims, schools and universities will want to confer with their insurer about policy limits. Although normal commercial auto coverage typically carries a million-dollar limit, excess casualty coverage can be obtained with limits of up to $25 million or more.

Student and employee transportation can be a serious liability risk for education institutions — but traveling beyond school grounds often is one of the most enriching aspects of school and university life.

Institutions need not avoid transportation. Instead, they should create a management approach that sets standards, documents compliance and communicates clearly with all of those involved. By taking these steps and obtaining appropriate insurance coverage, they can manage the risk and still offer the opportunities that travel provides their students and employees.

Federal warning on 15-passenger vans

Over the past six years, the National Highway Transportation Safety Administration (NHTSA) repeatedly has issued safety advisories about 15-passenger vans, recommending extra caution when they are used to move large numbers of people at once. Federal studies have shown 15-passenger vans have a tendency to roll over at three times the rate of lightly loaded vehicles when fully loaded. In fact, NHTSA data shows that 1,111 people died in crashes involving 1,576 of these types of vans between 1990 and 2002.

In its 2008 advisory, the NHTSA urged those who use the vans to:

Keep the passenger load light.
Check the van's tire pressure frequently, because improperly inflated tires can increase the chance of a rollover crash.
Require all occupants to wear seatbelts (80 percent of those who died in 15-passenger van crashes were not buckled up).
Avoid placing any loads on the roof and, if possible, seat passengers and place cargo forward of the rear axle.
Pay attention to speed limits and road conditions.
Use only qualified drivers.

The NHTSA said that the number of deaths has declined steadily since the federal agency's first warnings in 2002. Van owners have become more aware of the dangers. Nonetheless, crashes involving 15-passenger vans claimed the lives of 58 people in 2006.

Stevenson is Second Vice President, Commercial Accounts Product, with Travelers Insurance, Hartford, Conn.