When you are an owner-operator, you’ll need to obtain your own commercial truck insurance. A requirement before getting on the road, “trucking insurance” is available from dozens of different companies and with a variety of different options to choose from.
Most operators will work with a broker to find the cheapest rates possible on an annual basis.
And you’ll need to write a check before your insurance policy kicks in. The issue is that it’s not as easy as signing a policy and finding the cheapest insurer on the market. There is a lot to consider when you’re a trucker, and being liable for your actions on the road is a major responsibility that can bankrupt you immediately in the event of an accident.
Truck Insurance Companies
You’ll be obtaining insurance, but you’ll also be forging an alliance with an insurance company that you need to trust. When you go to get insurance, you’ll be talking to:
- Independent agents
- Sales staff
And then you’ll come across the various insurance company types. Some companies act as a one-stop-shop wherein they’ll offer insurance of all types to anyone that comes through the door. You’ll also find that there are insurers that:
- Specialize in commercial truck insurance
- Insure only fleets
- Specialize in certain niches within the field (i.e. owner-operators)
There are also companies that handle tens of thousands of operators, while others work only with large fleets or just a handful of different trucking outfits.
But there is something every driver should know: choose the truck insurance specialist. Why?
The smaller, non-specialized insurers do not understand the industry or the needs of truckers. Imagine carrying specialized freight that costs tens of millions of dollars. This freight is unlikely to be covered under your normal insurance.
The specialized company will allow for trip-altered insurance that is a one-off and will cover the freight.
You’ll also avoid those nights when you pull into a weigh station and are held by a police officer because your insurance isn’t on file with your home registration state. Non-specialists often do not know motor-carrier filing options or all about the MCS-90 endorsement. State limitations on wide load and high loads may also not be known, leaving you less prepared if the unexpected happens when on the road.
Commercial truck insurance specialists are also much faster.
Rather than waiting for days for an investigator to come and examine the truck following an accident, a specialist knows that you’re losing money when not on the road. Efficiency is what you’re paying for with insurance, and a specialized insurer will allow you to get back on the road as quickly as possible – no waiting for insurance adjusters.
5 Trucker Insurance Fundamentals
When all of the policies look the same, you’ll need to go back to the fundamentals when making the right choice for your insurance. The fundamentals that you need to be most familiar with include:
- The experienced company knows how the trucking industry work. They have stayed in business because they know the industry and they’re worth every penny.
- Insurers need to have enough reserves to be able to safely provide coverage to drivers. Check the company’s financial records and pay close attention to reserves.
- You need to know what you’re paying for, and what you could be paying an additional fee for. Obtain bids and quotes from several companies to find the right amount you should be paying.
- What is included in your policy? Can a policy be adapted to your unique situation? What contingencies exist?
- In the end, all of the previous points come down to one thing: value. Are you getting the best coverage possible from an insurer you can trust at a price you can afford? If so, you’re getting good value for your money.
When purchasing commercial truck insurance, you need to consider the whole package. This insurance isn’t cheap, but it’s worth paying more for if the offering protects you further.
Commercial Trucking Insurance Types
- Commercial Auto Liability
- Non-trucking liability
- Physical damage
- Motor truck cargo
- General liability
- Refrigerated Freight
- Food vendor
- Inland marine
- Occupational Hazard
There are several types of commercial truck insurance.
The right choice for you depends on what your position is:
- Owner operator insurance
- Motor carrier insurance
- Private carrier insurance
And then there are other variants:
- Are you leasing the truck?
- Are you working under your own authority?
This is why so many people go with insurance brokers because they’ll fill in all of these holes for you, so you can get the right insurance for your needs. Unfortunately, insurance companies are unforgiving – if it isn’t covered in your policy, they won’t cut you a break.
What Does Commercial Insurance Cover For Truck Drivers?
This title is slightly misleading because truck insurance may or may not cover everything I am about to list. Instead, a lot of the coverage is circumstantial or provided as additional coverage that is available at an added cost.
The insurance coverage that may be provided, includes:
- Cargo Insurance: Available with virtually every policy. This insurance will cover the cargo that you’re hauling. It’s important to pay close attention to maximum coverage limitations.
- Non-trucking Liability Insurance: Liability cover for when you’re not under dispatch. For example, if you’re driving the truck home and get into an accident, you would be covered.
- Physical Damage Cover: Required when leasing and often good to maintain. This cover will provide the cost of replacing or fixing your vehicle if it’s been damaged in an accident. This may also be called “collision insurance” or “comprehensive insurance.”
- Liability Insurance: A standard. This insurance will provide coverage to you in the event that you’ve caused damage to a person or someone’s property.
- Bodily Injury Insurance: Typically rolled into liability insurance, this insurance provides an umbrella coverage for your injuries and any passengers.
- Medical Payment Insurance: Medical concerns following an accident are covered under Medical Payments insurance. Not available in all states, this insurance will pay for the medical bills of yourself and any passengers in the vehicle.
- Uninsured Motorist Insurance: If the opposing driver does not have insurance, you’ll be covered. This covers you in the event that the opposing driver doesn’t have insurance or doesn’t have enough insurance.
- Trailer Interchange Insurance: An insurance option that covers the trailer if used under an interchange agreement.
- Worker’s Compensation: Insurance provided if you have employees. This insurance will protect employees if they’re hurt or disabled on the job.
- Umbrella Insurance: In the event that you surpass the covered liability insurance, an umbrella insurance will kick in.
Your insurance may cover all or some of the items listed above. Every state has its own minimums that must be met by all drivers, and you’ll need to investigate these limits for yourself. The insurance company that you choose will be able to inform you of the minimum required insurance by law.
Questions to Ask Before Signing a Policy
Signing a policy without reading over the terms or asking pertinent questions is a big no-no. The following questions should be asked to a broker or sales agent:
- If I raise my deductible, how much money can I save?
- What are the deductibles on my policy?
- What are my coverage limits?
- What additional coverage is offered?
- How can I obtain a discount on my policy?
Policies can be very expensive, and if you’re willing to pay a $500 deductible for physical damage insurance, you can often have your premiums lowered. Deductibles can go very high, and the higher the deductible, the less you’ll pay for premiums.
But be cautious when raising the deductible: you will need to pay your deductible before insurance kicks in their contribution.
Coverage limits must also be monitored with diligence.
If only $100,000 is provided for cargo insurance and you haul cargo worth millions, you’ll have coverage that leaves you liable for millions of dollars. You can alter your coverage limits to reduce rates, but this can lead to liability issues.
Always talk to the sales agent or broker to discuss your cargo insurance needs.
You never know what coverage you’ll need for your next load, so you may need one-off adjustments. You’ll pay for these limit adjustments, but it’s better to be covered than to be liable for cargo. Companies specializing in commercial truck insurance should have flexible options available, and you need to inquire about these adjustments.
And before you sign on to any policy, take the time to read through the policy in its entirety.
How Much Does Commercial Truck Insurance Cost?
The average cost of truckers insurance is just under $800. Specialty policies average in the mid $600’s and the cost rise up to $982 for owner-operators.
Your rate will vary based on your driving record, USDOT Authority, type of vehicle, trip range, unique coverage requirements, etc…
Do All Truck Drivers Need Insurance?
Owner-operators, hot shot drivers, local drivers, company drivers, bobtail, etc…
Basically all motor carriers have unique insurance requirements.