Knight-Swift CEO sees insurance edge after Montgomery ruling

Will the Montgomery ruling lower insurance costs for safe carriers?

Knight-Swift CEO Adam Miller told investors Oct. 21 that the market is beginning to favor carriers with clean safety records after the Supreme Court's decision in Montgomery v. Caribe Transport II. Miller said the ruling, which limits punitive damages in interstate trucking cases, creates a competitive advantage for fleets that invest in driver training, equipment maintenance, and ADAS technology.

The shift matters for equipment buyers because insurance underwriters are now pricing policies based on hardware-level safety features. Fleets running tractors with collision mitigation, lane-departure warning, and driver-facing cameras are seeing lower premiums than those without. Miller's comments suggest that gap will widen as brokers and shippers steer freight to carriers with lower liability exposure.

What changed after Montgomery

The Montgomery decision capped punitive damages in federal motor carrier cases, reducing the risk of nuclear verdicts that nearly tripled in 2025. Before the ruling, juries in several states awarded damages exceeding $100 million in crash cases, driving small fleets out of business and pushing insurance costs up 30 percent or more for the rest.

Miller's optimism reflects what insurers are now telling fleets: carriers with documented safety programs, modern equipment, and low CSA scores qualify for coverage that marginal operators cannot get at any price. That creates a two-tier market where the cost to run older tractors without ADAS is rising faster than the cost to spec new units with full safety packages.

Equipment implications for small fleets

For a small fleet deciding whether to spec collision mitigation on the next tractor order, the Montgomery ruling changes the math. The hardware adds $2,000 to $4,000 per unit upfront, but insurers are now discounting premiums 10 to 15 percent for fleets that run it across the board. On a $12,000 annual policy, that pays back the hardware cost in two to three years.

The ruling also affects resale value. Tractors without ADAS are harder to move at auction because buyers know they will pay more to insure them. A 2022 Freightliner Cascadia with factory collision mitigation holds value better than the same truck without it, even if both have identical mileage and maintenance records.

Miller's comments suggest Knight-Swift will continue buying tractors with full safety packages, which puts pressure on smaller fleets to match that spec or risk losing freight to carriers that can offer lower insurance costs to brokers and shippers.

What this means for owner-operators

Owner-operators leased to larger carriers benefit indirectly because the carrier's insurance covers the liability. But independent operators who carry their own policy face the same pressure to upgrade equipment. An owner-operator running a 2018 tractor without ADAS will pay more for liability coverage in 2027 than one running a 2023 model with the full suite, even if both drivers have clean records.

The Montgomery ruling does not eliminate nuclear verdicts, it only caps punitive damages. Compensatory damages for medical costs, lost wages, and pain and suffering can still run into eight figures in severe crashes. That means insurers still care about crash prevention, and the equipment that prevents crashes is now a pricing factor in every policy renewal.

For fleets and owner-operators, the takeaway is straightforward: the cost of not running modern safety equipment is rising faster than the cost of buying it. Miller's optimism about Knight-Swift's competitive position is based on the fact that the company already made that investment. Smaller fleets that have not will face higher insurance costs, tighter capacity from underwriters, and weaker resale values on older iron.