Reference no: EM132296124

You have worked as a traffic manager for a local trucking company for five years. One of your core shippers contacts you and wants you to start your own trucking operation. You review it for several months and survey the market place in your state and find the business would be profitable. You get a bank loan for $250,000 at 8.75 % interest and use your house as collateral. You use the capital to purchase two semi tractors and six trailers and rent an old warehouse for $1200 per month for a twelve month lease. You calculate it will take three years before you start getting a solid return on your initial investment, and that your cash flow will be pretty tight for the first three years of operation. Before you can begin operations and can obtain your operating authority, you are required to get insurance for cargo, physical damage for the fleet, and general liability. Your insurance agent gives you three options: $100,000 coverage $15,000 premium $500,000 coverage $60,000 premium $1 million coverage $85,000 premium Consider and review options, and which would you choose.Give your reasons for that choice. After seven months of operation, your driver calls in a serious accident. A young male driver of a Ford Taurus has attempted to beat a yellow light run through a red light, slammed on his brakes and skidded on the wet pavement. His car has run into the side of your trailer as your driver pulled out on the green light. There are several witnesses to the accident who verify the youth going through the red, and the green light for your driver. The young 19 year old driver is crushed to death as the car wedges under the side of the trailer and into the rear wheels of the trailer. Because of the force and speed of the car, the young driver is partially decapitated in a gruesome

scene. As the owner of the company, is there any potential risk to your company? If you had to venture a guess, what figure would you estimate a jury may impose as a penalty for the life of this 19 year old?