Assessing Commercial Truck Downtime: Labor Hours vs. Total Days Out of Service
I am an attorney in Ohio representing a commercial truck owner whose parked vehicle was struck, with the other party being 100% at fault. Since I have limited experience with commercial truck claims, I’m seeking insights on industry standards for calculating downtime.
Case Details:
- The truck was in an authorized repair shop from September 5 to September 30 (total: 25 days).
- A discontinued chassis fairing part caused a delay until September 23.
- The insurance company only covered 8 days of downtime, calculating payment based on labor hours (divided by 4 hours per day).
- They argue that parts should have been procured before the vehicle’s drop-off, thus they won’t cover the waiting period.
Inquiry: Is the industry standard for assessing commercial vehicle downtime based on labor hours or the actual days out of service? Should my client receive compensation for the complete 25 days the truck was inoperable? He mentions that he has previously been compensated for the entire duration the truck was in the shop, rather than just the labor hours recorded.
I would greatly appreciate input from commercial adjusters and insurance professionals who specialize in these claims. Thank you!
It’s great that you’re looking for industry input on this matter, as truck downtime can involve nuanced calculations based on various factors. Generally speaking, the industry standard for calculating downtime can vary by policy and adjuster, but here are some thoughts to consider:
Downtime Calculation: Many in the industry advocate for calculating downtime based on actual days out of service rather than solely on labor hours. This approach generally accounts for the entire time a vehicle is unavailable for operational use, which can include waiting for parts and other delays. Your client’s claim for the full 25 days the truck was unavailable seems reasonable, especially if the truck was parked and not generating income during that time.
Insurance Policies: The terms outlined in the insurance policy can significantly impact how downtime is calculated. Some policies do include provisions for payment based on days out of service, while others may focus on labor hours. Scrutinizing the policy language may provide further clarity and support for your case.
Documentation and Precedent: If your client has historically been compensated based on the actual days out of service, documenting this precedent can be beneficial. Providing evidence of prior claims that were settled in a similar manner may strengthen your position in negotiations with the insurance company.
Industry Practice: It’s not uncommon for claims to be disputed on this basis, particularly when it comes to interpretation of policy language regarding repairs and downtime. In practice, many commercial adjusters do consider the overall impact of downtime on a truck owner’s ability to generate revenue, which encompasses more than just labor hours.
Negotiation with Adjusters: If you’re communicating with the insurance adjuster, emphasize the importance of the downtime for the business’s operational capacity as well as the industry norms. It may help to clarify that the delays in sourcing parts (which were outside of your client’s control) should be considered in the overall assessment of downtime.
Overall, pushing to have your client’s downtime calculated based on actual days out of service aligns with industry standards, especially given that waiting on parts and other non-labor-related delays contributed to the extended downtime. Good luck with your case!