What You Should Know Before Getting Trucking Insurance
Trucking insurance is an essential requirement for anyone who owns or operates a commercial truck. It provides protection against damages caused by accidents, theft, fire, or any other unforeseen circumstances. However, determining the cost of trucking insurance can be challenging, as it depends on various factors, including the type of vehicle, cargo, and driving history of the owner or operator.
In this blog, we will discuss the average price and coverage for trucking insurance in the USA.
Factors that affect the cost of trucking insurance:
The cost of trucking insurance varies based on several factors, such as the age and condition of the vehicle, the type of cargo being transported, the driving record of the driver, and the location of the business.
The following are some of the factors that may affect the cost of trucking insurance:
- Type of Vehicle:
The type of vehicle being insured is a crucial factor that affects the cost of trucking insurance.
Newer trucks and trailers will generally have a higher premium than older vehicles.
- Cargo Type:
The type of cargo being transported can also influence the cost of trucking insurance. High-value cargo or hazardous materials may require more extensive coverage and, therefore, have higher premiums.
- Driver’s Record:
A driver’s record can also have an impact on the cost of trucking insurance. Drivers with a history of accidents or traffic violations may have to pay more for insurance.
- Location of Business:
The location of the business can also affect the cost of trucking insurance. Trucking companies operating in urban areas may have to pay higher premiums due to higher traffic and accidents rates.
Average Cost and Coverage of Trucking insurance:
The average cost of trucking insurance in the USA can vary significantly based on the factors mentioned above. However, according to Insureon, a small business insurance provider, the average cost of commercial auto insurance, including trucking insurance, is around $1,704 per year. This cost can range from $800 to $1,800 per month, depending on the size of the business, the type of cargo years in business, and other factors.
The coverage for trucking insurance can also vary based on the needs of the trucking company.
In order to operate every truck and trailer has to be covered, with liability coverage ranging $750k - $1mil; cargo $100k - $250k; general liability; physical damage (Value of Equipment); additional coverage and these are called main coverage for trucking.
Common commercial trucking insurance coverage includes:
- General Liability
General liability insurance is mandated by every state. It safeguards you in case if one of your drivers causes bodily harm or property damage as a result of an accident. It covers a driver's conduct when on a third party's property, such as a loading dock or a truck stop. Errors in load delivery are also included.
- Primary Auto Liability
As previously stated, you must obtain this insurance in order to comply with federal rules. All of your trucks, including those you've rented, need to be covered by commercial auto insurance. If an accident results in the injury of a third person, liability insurance will protect you.
- Bobtail
Bobtail coverage, also known as non-trucking liability, is insurance for situations in which the truck driver is using the vehicle for non-business-related purposes or is not being dispatched. Bobtail coverage will take over in any circumstances where the owner-operator is not protected by primary liability policy. However, truckers who are towing a trailer, utilizing a truck for business, or operating a truck for a trucking company are not covered by bobtail insurance.
- Physical Damage
Physical damage insurance will cover the cost of repairing a commercial truck or trailer after being harmed by items like:
Vandalism
Collision
Theft
Natural Disaster
As an alternative, this coverage will replace your truck if it is destroyed beyond repair. The premiums are based on how much the truck and its accessories cost.
- Motor Truck Cargo
If the cargo on one of your commercial trucks is lost or damaged, this coverage offers you security. The type of freight will determine the premiums.
- Rental Reimbursement
Rental reimbursement does exactly what it says on the paper: it pays for you to rent a replacement truck while yours is getting fixed.
- Trailer Interchange
For trailers being pulled in accordance with a trailer interchange agreement, physical damage protection is provided through trailer interchange insurance. For non-owned trailers, this effectively functions as physical damage insurance. If the trailer is harmed by a collision, fire, theft, explosion, or vandalism, you are covered under this insurance.
- Reefer Breakdown Coverage
The following expenses would be covered by reefer breakdown insurance if you own refrigerated trucks:
- Refrigerator failure
- Lost goods
- Product damage as a result of a collision
Exclusions apply to several insurance policies. For instance, certain goods—like tobacco products, frozen food, or seafood—are not included.
- Uninsured/underinsured motorist
This insurance is best for those who have not insured their vehicles and end up in any form of collision with another person.
- Medical Payment
The ideal candidates for this insurance are those who failed to insure their vehicles and were involved in any kind of collision with another individual.
Here are the top insurance providers:
- Best for single trucks: Sentry
https://twitter.com/SentryInsurance
https://www.youtube.com/user/sentryinsurance
- Best customer service: State Farm
https://www.youtube.com/c/statefarm
- Best for every type of trucking insurance: EIB Direct
https://twitter.com/xinsurance
https://www.youtube.com/user/xinsurancecom
- Best for small business truckers: OOIDA
https://www.youtube.com/user/TruckersOOIDA
Conclusion:
Trucking insurance is an essential investment for anyone who operates a commercial truck. The cost of trucking insurance can vary significantly based on several factors, including the type of vehicle, cargo, and location of the business. The average cost of trucking insurance in the USA is around $1,704 per year, but this can vary depending on the size and needs of the business. It is essential to work with an experienced insurance provider to determine the appropriate coverage and policy for your business.