Commercial Truck Insurance 101

PRIMARY LIABILITY
Primary Liability Insurance coverage protects you from damage or injuries to other people as a result of a truck accident you caused. This truck insurance coverage is mandated by state and federal agencies(FMSCA) and proof of coverage is required. We provide insurance coverage limits ranging from $750,000 to $5,000,000. Pricing varies widely by region, driving records, and history of the trucking operation.

PHYSICAL DAMAGE
Physical Damage Insurance is coverage for your truck and trailer. This insurance coverage is for repair or replacement for damage resulting from things such as collision, fire, theft, hail, windstorm, earthquake, flood, mischief, or vandalism to your owned vehicles. Pricing is based on the value of your equipment and usually pays a percentage of that value. Physical damage coverage may be required by the lien holder of your vehicle.

MOTOR TRUCK CARGO
Motor Truck Cargo insurance is needed to protect the carrier in case of lost freight or damaged goods. Truck insurance coverage limits can range from $10,000 to $250,000. Pricing for this insurance is mainly dependent on the type of cargo being hauled.

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FMSCA REQUIREMENTS

Redwood offers liability coverage that fulfills the legal obligations of those owner-operators who have obtained their own authority, or who are hauling exempt commodities.

In addition to filing an application for your operating authority, all applicants for motor carrier, freight forwarder, and broker authorities must have specific insurance documents on file before the FMCSA will issue your authorities.  The minimum requirements for freight or passengers are below:

    • Freight: $750,000 – $5,000,000, depending on commodities transported; $300,000 for non-hazardous freight moved only in vehicles weighing under 10,001 lbs.
    • Passengers: $5,000,000; $1,500,000 for registrants operating only vehicles with seating capacity of 15 or fewer passengers.

You should be prepared to purchase your liability insurance as soon as you obtain your designated docket(DOT) number. Once you purchase your insurance policy, the insurance company files the appropriate forms with FMSCA letting them know you have the required coverage.  FMSCA must receive notification within 90 days in order to approve and release your authority.

For additional info visit https://www.fmcsa.dot.gov/registration/insurance-filing-requirements.

 

COST OF INSURANCE

If you’re just now obtaining your DOT number, expect trucking insurance premiums to range from $1200 to $2000 per month for a single driver, one truck, one trailer operation. Most carriers will also require 20% down ($2400 to $4000) to get started.  Progressive is the largest writer of new trucking authorities in the country. 

After you’ve had your policy for 12 months or longer, you’ll have additional insurance options available.

 

Call a Redwood Agent today at (512)994-0894 if you have questions or if you’d like to get a preliminary quote just to get an idea of your insurance costs.

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