Commercial Trucking Insurance

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What You Need To Know Before Buying Trucking Insurance

The commercial trucking industry is a vital part of the U.S. economy, transporting around 70% of the goods all over the country. This industry is also as risky as it is significant. All trucking businesses have to face a fair share of liabilities and threats on a constant basis.  

If you are driving a truck commercially or are in a trucking business, commercial trucking insurance is a great way to remain on a safe and steady track 

But before you jump right in by contacting an insurance agent or an agency to purchase commercial trucking insurance, it’s essential to be aware of some checkpoints. Don’t forget to consider what your business requires and what the agent or agency is willing to offer.

Documents and Legal Requirements to Get Commercial Trucking Insurance

Commercial trucking insurance covers not just you but also your customers by protecting them from accidents or damage while they’re on the road, and while delivering goods to different stores. 

The first thing that comes into play when running a commercial trucking business is making sure everything’s in order from an insurance standpoint. This includes telling what kind of vehicles will be used for each load or delivery transaction as well as meeting all requirements related to private carriers (which are usually more stringent). Don’t let these small tasks slip past! 

Some of the major documents required for a trucking policy are mentioned below: 

Commercial Driver’s License (CDL)

As a trucker, keeping your CDL up-to-date and fulfilling all necessary insurance documents is essential.  

CDL is a particular type of license for the drivers operating different kinds of trucks as per the cargo weight. 

MC and DOT Authority

MC (Motor Carrier) and DOT (Department of Transportation) numbers are regulated by Federal Motor Carrier Safety Administration (FMCSA).  

An MC number is required when you’re hauling items across state lines. However, if your trucking company also operates intrastate and transports construction equipment or property owned by someone else, they need a DOT Number instead! 

Other Documents 

Besides the aforementioned requirements, you also need to provide the documents stating your vehicle make and model information. Not just this, you also have to have supporting papers that mention the year it was bought in and the Vin number of specific vehicles you want to add to your trucking policies. 

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    Questions You Need To Ask Before Buying Commercial Truck Insurance 

    Are you an owner/operator?

    An owner/operator will require different insurance to ensure the entire business is protected from liability.

    Are you an independent contractor?

    To ensure they are protected from responsibility, an independent contractor or someone who drives under their authority will require insurance plans that differ from those needed for an owner/operator.

    Do you know how many trucks and drivers you have working under you?

    Many insurance companies will consider the number of trucks and drivers because the more trucks and drivers are on the road, the higher the risk of accidents. 

    Do you have access to the driving records of your employees and yourself?

    Keeping track of your and your workers’ driving records is critical. It informs insurance companies about your and your workers’ driving records. Your premiums could rise if you have personnel with a history of accidents.

    Do you know the make and model of the truck(s)?

    Regarding your quote, the age and newness of the trucks under your care will be a decision element. Older trucks are more likely to break down on the road, and modern trucks may be more expensive to insure. You must tell your insurance company about this.

    Can you easily state what type of trucking business you operate?

    This is usually self-evident. You undoubtedly know what business you run if you’re shopping for trucking insurance. If you own an auto body shop, you may not realize you require tow truck insurance. It’s critical to consider the trucks you utilize and how frequently you use them.

    Do you tow trucks?

    Because tow vehicles and cargo trucks serve different purposes, they will require other policies.

    Do you haul cargo?

    Cargo will require insurance. You don’t want to be held accountable for cargo damaged in an accident because your insurance coverage was incorrect.

    Do employees have access to trucks when they aren’t working?

    Your firm will determine whether you or your workers use the truck after hours. However, they will not use the truck for non-business purposes in most circumstances. If you intend to use the truck for such purposes, you will need insurance covering it.

    Do you already have trucking insurance policies?

    If you currently have an insurance policy, go over it and develop a list of the areas where you believe your company isn’t getting enough coverage. If you believe your costs are too high, checking around for more affordable truck coverage for your business will be beneficial.

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    Factors That Could Affect Your Commercial Trucking Insurance Premiums

    The cost of commercial trucking insurance can greatly vary across trucking companies. When an average owner-operator is charged $8,500 to $14,000, insurers can also charge anywhere above $20,000 for a new entrant in the trucking market. This range depends on a number of reasons, of which, some are listed below: 

    • Driving History 

    In the trucking industry, even the smallest offense such as speeding can affect the insurance rate you get quoted as a driver. So, it’s best to keep the record clean! 

    • Claims History 

    Like every other person or business seeking insurance, one’s claim history also plays a very important role in determining the quote of the commercial trucking insurance. The higher number of claims hints at the high chances of you, as a trucking industry personnel, filing more claims in the near future. 

    • Operating Radius 

    How far you travel in order to transport goods affects the insurance rate you get. When you travel to less familiar and regional routes, you will be quoted a higher rate. 

    • Type of Cargo 

    The commercial trucking business consists of different vehicles carrying a range of cargo. Depending on the type of cargo and the degree of risk associated with it, the commercial trucking insurance rate fluctuates quite a lot. 

    • Type of Vehicle 

    Most of the time, the type of truck influences the insurance rate you are quoted for. When you have a comparatively heavier and more spacious semi-truck, the insurance rate shoots right up. 

    • Location 

    Besides the operating radius of the trucks, the states you travel to and the garage location can also determine the insurance rate for your commercial trucking company. 

    Other factors that affect the insurance cost are as follows: 

    • Value of Vehicle 
    • Credit History & Financial Wellbeing 
    • Policy Structure & Bundling 
    • Contractual Requirements 
    • Company History 
    • Maintenance of Trucks 
    • Credit History and Financial Credibility

      Why Is Commercial Trucking Insurance Important?

      Commercial trucking insurance is designed for trucks that are used for business, farming, or other commercial purposes. If you use your truck for personal reasons, you won’t be covered under a commercial truck insurance policy. 

      For business operators, commercial trucking is a vital part of their operations. Without trucks to transport goods and materials, businesses would grind to a halt. Trucking companies play a vital role in keeping the wheels of commerce turning. 

      Trucking insurance is monumental for the smooth functioning of trucking businesses because there are a number of risks involved in commercial trucking, including: accidents, damage to goods being transported, theft, and liability. All of these risks can be covered by insurance policies designed specifically for commercial trucking businesses.

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