With the expectation for fast delivery as well as the recent supply chain issues that continue to affect shipping, the need for more trucks serving our ports has never been greater. Enter intermodal trucking.
Intermodal trucking is a crucial piece of our global economy, ensuring goods are efficiently moved between modes of transportation. A quick transition from ship or rail to truck keeps freight moving and reduces port congestion. But, with so many moving pieces, an industry standard is needed. Here’s what you need to know about intermodal trucking and UIIA:
What is Intermodal?
Freight shipping from overseas needs to be transitioned to rail or truck, or both, near the point of entry to end up in warehouses, retail stores, and ultimately at consumers’ doors. Simply put, intermodal trucking is shipping that uses multiple forms of transportation (ocean, air, rail, truck). International freight often arrives at ports by ocean and is transferred to trucks, while domestic freight often involves a combination of rail and truck.
A good example of how this works with international freight would be a Chinese shipper transporting freight overseas to a US port. Once the ship is in port, the freight is unloaded onto a waiting truck with a chassis that can accept the container. That truck transports the container to a nearby facility where the freight is moved from the shipping container to an individual trailer. Once the freight is loaded into this trailer, another truck takes this freight to the final destination.
With intermodal trucking involving a variety of vehicles including ships, trains, and trucks, an industry-standard needed to be applied to ensure smooth operations. That’s where UIIA comes in.
What is UIIA?
Uniform Intermodal Interchange and Facilities Access Agreement (better known as just UIIA) is an industry-standard contract among truckers, sea and rail cargo companies, equipment providers, and drayage companies. “The program is administered by the Intermodal Association of North America (IANA) and covers liability and other issues related to the interchange of intermodal equipment and the freight within, between the two parties.” [2]
Why is UIIA important
UIIA lays the foundation for a standard set of processes and procedures that individuals and companies in the intermodal trucking industry follow. With the unique aspects of intermodal shipping, the UIIA promotes productivity and operating efficiencies by laying out these regulations for the interchange of intermodal equipment, including containers, trailers, and more.
The UIIA also issues certificates to freight carriers that confirm they are adequately insured to operate in the port or rail yard. These certificates are purchased after all proper insurance coverage is in place, including Auto Liability, Trailer Interchange, General Liability, and Cargo coverage. Without a UIIA certificate, the carrier risks being denied entry to the port or railyard. [1]
What you need to know
When it comes to UIIA and the proper insurance coverage for intermodal trucking, you need an insurance agent and company with knowledge and experience handling UIIA matters. It is easy for an inexperienced agency to make a mistake with UIIA and the coverage required, and an incorrectly bound policy can be difficult and costly to correct.
Another essential aspect is that the age-old adage of “you get what you pay for” applies here as well. Many truckers new to intermodal hauling seek inexpensive insurance coverage, but this can lead to inadequate coverage, which ends up costing far more in the long run. These inexpensive coverage options may seem like a good idea at the time, but risk not conforming to UIIA requirements. Fixing a policy that is already bound with incorrect coverage could cost much more in the long run than choosing the correct insurance from the start. An insurance agent well-versed in UIIA requirements can ensure that the right policy is selected, saving truckers time, money, and headache in the long run.
Additionally, shippers in the UIIA often prefer to work with carriers that are higher rated. While the higher-rated carriers may cost more per truck, you’ll generally have access to more jobs than you would with a lower-rated carrier.
Finally, before you can enter the port or railyard, you’ll need a UIIA certificate. Your insurance agent will complete this with a Standard Carrier Alpha Code (SCAC). This four-letter code identifies your company in the databases maintained by the UIIA and Equipment Providers such as ocean carriers, railroads, and equipment leasing companies. With an insurance policy, SCAC, and UIIA certificate in hand, you’ll be ready to handle intermodal freight.
Wrapping Up
Intermodal trucking and UIIA each have their quirks. Once you understand some of the unique elements, it can offer a change from traditional over-the-road trucking or local routes.
If you’re interested in getting a quote for UIIA and intermodal insurance with Cover Whale, tell your insurance agent that they can get appointed to start binding policies today. With Cover Whale, they can quote and bind a policy on the same day so that you can get the right insurance quickly and start delivering!
Frequently Asked Questions about UIIA
What does UIIA stand for?
UIIA is an acronym for the Uniform Intermodal Interchange and Facilities Access Agreement. This agreement is a standard contract between truckers, drayage companies, water carriers, rail carriers and equipment providers governing the interchange of equipment between ocean, railroad and over-the-road shipping.
Who implemented UIIA?
The Uniform Intermodal Interchange and Facilities Access Agreement (UIIA) was established in 1973 by a joint task force constituting representatives from the Association of American Railroads, Equipment Interchange Association and Steamship Operators Intermodal Committee. It was developed under the supervision of the U.S. Department of Transportation and the Maritime Administration. Today, the Intermodal Association of North America (IANA) manages the UIIA.
Who is IANA?
The Intermodal Association of North America (IANA) is a trade association representing the interests of members of the intermodal freight transportation industry. IANA is made up of representatives from a number of motor carriers, suppliers, rail and marine companies, third-party logistics providers, and other industry associates.
Why was UIIA created?
Before the UIIA, ocean and rail carriers primarily used individual interchange agreements. However, the UIIA was established to bring about uniformity and efficiency to the interchange of trailers, containers, and equipment used in intermodal surface transportation.
What is the difference between OTR and intermodal?
OTR (Over-The-Road) trucking involves long-haul routes that usually span across several states, often keeping drivers away from home for extended periods. On the other hand, intermodal trucking involves transporting freight using multiple modes of transportation (ship, rail, and truck). These jobs oftentimes are regional or local, meaning drivers may be able to return home more frequently.
What is the intermodal rate?
The intermodal rate is the price charged for intermodal transportation services. This rate can vary based on several factors, such as the type of commodity being transported, distance, market demand, fuel costs, and any other specific service requirements. These rates will often include costs associated with multiple modes of transportation—such as rail, ship, and truck. As a rough estimate, an intermodal rate might range from $1.50 to $2.50 per mile, though it can be higher or lower based on route, demand, type of goods, fuel costs and location. Some ballpark rates for major seaports include:
Port of Los Angeles: Given its high traffic, intermodal rates might typically range from $1.75 to $2.75 per mile.
Port of New York and New Jersey: Given its utilization and the dense population of the surrounding market area, intermodal rates might typically range from $2.00 to $3.00 per mile.
Port of Savannah: As one of the largest US seaports, its intermodal rates might typically range from $1.50 to $2.50 per mile.
These figures are rough estimates and actual rates will depend upon various factors, including the specific requirements of each shipment and current market conditions. It’s crucial to continually assess and evaluate market trends and operation costs to identify the most appropriate pricing for your services.
Why does intermodal pay more?
There are several reasons why intermodal pays more:
Supply and Demand: The continual growth in global trade has increased the demand for intermodal transportation. This high demand and the limited availability of professional drivers push intermodal rates up.
Skills and Experience Required: Intermodal trucking often requires specific skills and understanding of complex logistics involving multiple modes of transportation. This expertise can contribute to higher pay.
Risk Factor: Considering the involvement of multiple transport modes, from rail to road to sea, the risks associated with intermodal trucking can be higher which is reflected in the rates.
How much do local intermodal drivers make?
Earnings for local intermodal drivers can significantly vary by location, experience, and the specific company they work for. However, industry reports suggest that they can typically earn between $50,000 and $70,000 annually. Some experienced intermodal drivers can potentially earn well over $70,000 a year.
Is intermodal trucking worth it?
The worthiness of intermodal trucking can vary based on individual and company situations. However, here are some relevant factors:
Higher Earnings: As mentioned, the pay rates for intermodal trucking are typically higher than those of traditional trucking.
Home Time: Many intermodal jobs are regional or local, allowing drivers to spend more time at home compared to over-the-road (OTR) drivers.
Growing Sector: The intermodal sector is growing, providing strong job security. However, there may be more complex scheduling and coordination, and you might need specialized training.
Sources:
[1] https://www.freightwaves.com/news/insurance-basics-hauling-intermodal
[2] https://www.zippia.com/truck-driver-jobs/intermodal-trucking/
[4] https://www.uiia.org/insurance-agents/uiia-insurance-requirements
[5] https://www.uiia.org/uiia-insurance-agents-directory
[6] https://www.uiia.org/help-guides-webinars/motor-carrier-general-help
[7] https://docs.google.com/document/d/1BwZyvCB437rGt4D_8YWTcR7Hdzp_nlrO-t9QM1EvEYY/edit
