California Trucking Insurance 101

If you want to operate a commercial truck in California, you’ll need to meet certain insurance requirements. Requirements for California truck insurance will depend on a few factors, including what you’re hauling and the type of vehicle you’re operating.

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Whether you plan to operate interstate or intrastate, it’s important to understand the types of coverage you will need and the minimums for each type of coverage.

California Trucking Insurance Requirements

The type and amount of insurance you need will depend on a few factors.

In the state of California, you need a California Motor Carrier Permit if you plan to:

Transport hazardous materials
Operate large commercial vehicles
Transport property
Operate vehicles that require a commercial driver’s license

In order to obtain a California Motor Carrier Permit, you must meet certain insurance requirements.

Here’s what the state requires:

California Liability Coverage

Liability levels will range from $300,000 to $5,000,000 combined for single-limit coverage. How much you need will depend on the type of property you’re transporting and the vehicle you’re operating.

Vehicles under 10,000 lbs. GVW need at least $300,000
Vehicles over 10,000 lbs. GVW need at least $750,000

According to the California DOT, commercial vehicles with 7 passengers or less will need at least $750,000 in liability coverage.

You must provide proof of coverage via:

A Certificate of Insurance (MC 65 M) from your insurer, OR
Certificate of Self Insurance (MC 131 M)

If you want to apply for a Certificate of Self Insurance, you’ll need to meet even more requirements.

Must have at least 25 commercial vehicles registered in the motor carrier’s name.
Must not have any unsatisfied judgments against you, your DBA (doing business as) or your trade names resulting from damages caused by a motor vehicle accident.
The required level of liability insurance doesn’t exceed $750,000.

So, essentially, if you want to obtain a California Motor Carrier Permit, you must have $300,000-$5 million in liability insurance. Most commercial truck drivers will need around $750,000 in liability, but $1 million is typically the industry standard.

However, some types of freight will require more or less coverage:

Oil transport: $1 million
Hazmat transport: $5 million
Household goods transport: $300,000

You’ll also need to ensure your policy has cargo insurance with coverage of $20,000 per vehicle and $20,000 per incident.

California and the USDOT will require certain insurance filings. Your insurer should take care of these filings for you.

CA Workers’ Compensation Insurance

In order to obtain a California Motor Carrier Permit, you will also need to show proof of workers’ compensation insurance. Your coverage must meet the state’s workers’ comp laws.

You’ll need to submit one of the following:

A Certificate of Insurance submitted electronically by the State Compensation Insurance Fund (SCIF).
A Certificate of Insurance using form MC 65 M
A Certificate of Consent to Self-Insure issued by the Office of Self-Insurance Plans (OSIP) or Department of Industrial Relations (DIR)

Alternatively, you can provide a signed exemption statement if you’re the sole employee of your operation. California has strict workers’ compensation laws, so make sure that you understand the exemptions before attempting to provide a signed exemption statement.

Who Does Not Need an MCP?

Some types of vehicles and drivers do not need an MCP. These include:

Carriers transporting used store, office and institutional furniture and fixtures. These carriers must be operating under a household goods carrier permit issued in accordance with §5137 of the PUC.
Pickup truck drivers with vehicles that have a GVWR of less than 11,500 lbs., have an unladen weight of 8,011 pounds and are outfitted with a box-type bed no more than 9’ in length. However, the truck must be operated in a non-commercial manner.
Two-axle daily rental trucks with a GVWR of under 26,001 lbs.
Vehicles that are exempt from vehicle registration fees.
Two-axle truck tractors or motor trucks with a GVWR of under 26,001 lbs. that is not operated commercially and used for specific purposes outlined by the CA DMV.

If you plan to operate a commercial truck for commercial purposes, you’ll likely need an MCP. There are only a few exceptions.

CA Insurance Requirements for Interstate Trucking

If your truck will be crossing state lines, you will need to meet the insurance requirements set by the Federal Motor Carrier Safety Administration (FMCSA):

$750,000-$5 million for freight coverage (vehicles over 10,000 lbs.)
$300,000 for non-hazardous freight (vehicles under 10,000 lbs.)
$5,000 per vehicle and $10,000 per occurrence in cargo insurance if you’re hauling household goods

Other Types of Truck Insurance to Consider In California

Liability and cargo insurance are required by law in California, but there are other types of insurance you should consider if you’re operating a commercial truck, including:

Trailer interchange: This policy will cover the trailers you use. It can help protect against fire, physical damage, vandalism, theft and more.
Physical damage (this may be included in your liability coverage): This policy covers your truck if it’s damaged. It includes collision (protects against accidents with other vehicles or objects) and comprehensive (protects against vandalism, fire, theft, etc.) coverage.
Uninsured motorist: This policy will provide coverage for repairs and injuries if the other motorist is uninsured or underinsured.
Non trucking liability: This policy will provide coverage if your truck is involved in an accident while it’s not being used for commercial purposes.
Umbrella policy: An umbrella policy will help bridge gaps in coverage to minimize out-of-pocket costs.

How Much Does Truck Insurance Cost in California?

The cost of truck insurance in California will depend on several factors, including:

Types of vehicles you’re operating
What you’re transporting
How long you’ve been in business
Your driving history

Tow truck insurance in California, for example, may cost more than a policy for vehicles hauling general freight because there are more risks involved.

That said, the average cost of commercial truck coverage is $14,189. Premiums generally range from $12,100 to about $16,600.

It’s important to note that these costs are just for single-truck operations needing insurance for liability, physical damage and cargo.

Your premiums may be significantly higher or lower, depending on your individual business. For this reason, it’s important to gather and compare quotes from different carriers to find the best price and the best coverage for your needs.

Consider working with an agent with industry experience and who will understand your needs. The right agent can help ensure that your policy provides adequate coverage and will protect against your unique risks.