Legal risk is outpacing coverage in the waste hauling sector, turning routine accidents into business-ending events as insurers retreat and multimillion-dollar verdicts become the norm.
Social inflation and aggressive legal strategies like third-party litigation funding have made high-dollar verdicts more common. What once settled for six figures now routinely escalates into multimillion-dollar payouts. Sometimes operating with bare minimum insurance, waste haulers are particularly vulnerable. Some still carry only those limits required by law or contract holder, even as fatality claims now stretch into the $7 million range.
Matt Andrews (pictured), senior managing director at Amwins Program Underwriting, has seen this volatility intensify. “A compassionate plaintiff and a sympathetic jury can mean an award far, far greater than the actual worth of a claim – regardless of the circumstances,” he said.
While waste hauling shares basic risks with commercial auto, the stakes are rising faster. Weak hiring practices, poor vehicle maintenance, and legal environments primed for big payouts have made the sector a target. In markets like Dallas, Andrews also pointed to a growing “billboard culture” where personal injury attorneys advertise services and dollar figures.
For brokers and clients alike, it’s a reality check. Without high-quality drivers, rigorous safety standards, and adequate coverage, one crash can take down an entire company.
Yet many waste haulers operate without adequate coverage to withstand these escalating risks. Despite the rising severity of claims, insurance limits have not kept pace.
"It comes down to a question of cost and we’ve seen companies opt to limit coverage, choosing policies that won’t adequately cover a potential severe claim," Andrews said. "For example, a fatality that may have cost a million dollars 10 years ago – now, the sky’s the limit."
This gap becomes even more critical as insurance carriers retreat from the sector. Capacity is shrinking, premiums are rising, and many brokers struggle to place excess coverage.
"They're reducing their capacity, dropping or cutting limits, or getting out of the space entirely," Andrews said. "Some [insureds] are making a difficult choice to simply meet the state requirement."
That choice may feel viable in the short term, but it's dangerous for larger operators with more to lose. "Without the limits to cover a potential severe claim, a company’s assets are vulnerable," Andrews said.
Operational pitfalls compound the legal and insurance headwinds. Poor driver hiring, inadequate training, and a lack of ongoing oversight have become recurring themes. For Andrews, the quality of a company's drivers is the most critical factor in loss prevention.
Vehicle maintenance can be another red flag. Claims involving faulty equipment like missing wheel components, failed load securement, or disabled backup sirens are rarely isolated incidents. They're signs of a broader cultural breakdown.
"The quality of a company’s drivers matters more now than ever before," he said. Those operators who focus on vehicle maintenance and driver safety via training programs and telematic solutions will have better risk profiles, better loss histories, and therefore more and better insurance options available to them.
"It’s important to have frank conversations with clients about uncomfortable possibilities if they choose to cut corners in any facet of their operation," Andrews said.
The cumulative effect of operational shortcuts, inadequate insurance, and the potential of an unforgiving legal system exposes many waste haulers to business-ending events.
"As an agent, educating your insured can go a long way in improving outcomes," Andrews said. Operators with quality operations and driver pools and who focus on safety will always have more insurance options.
Education, transparency, and a hard look at operational standards may be the only way forward. While the risks may resemble those in broader commercial auto, the liability landscape for waste haulers is evolving even faster.
