Our goal at RJS is to make insurance easy and to help each of our clients understand the importance of their commercial insurance needs. Commercial truck insurance is vital to protecting your business and complying with legal requirements when operating a trucking company. That is why choosing a partner such as RJS Truck Insurance is essential when searching for your commercial truck insurance needs. Our agency has focused on transportation for over 30 years with a passion for the Truck industry. Understanding the basics of commercial truck insurance is essential for fleet owners and owner-operators alike.
Commercial truck insurance covers trucks, trailers, and cargo in the event of accidents, theft, damage, or other unforeseen circumstances. It typically includes several key types of coverage, such as liability insurance, physical damage coverage, and cargo insurance.
While many insurance companies offer truck insurance, not all specialize in the Truck Industry. Ensuring the company is A-rated is extremely important for future success. A-rated carriers are important in the insurance industry due to their strong financial stability and reliability. This rating gives policyholders confidence that the carrier can fulfill its obligations, such as paying claims promptly. It protects policyholders’ interests during challenging times.
Moreover, A-rated carriers enjoy a positive reputation within the insurance industry. Their high rating indicates that they have demonstrated consistent financial performance, responsible risk management, and adherence to regulatory requirements. This reputation attracts business partners, including agents, brokers, reinsurers, and potential policyholders. Working with an A-rated carrier not only offers peace of mind but also provides a competitive advantage in the market, as these carriers have broader access to insurance markets and can offer a wider range of coverage options.
Searching for A-rated carriers is important, but so is ensuring you have all the right coverages. No one wants to leave the grocery store without all the right ingredients for their recipe, and with insurance, it’s the same. Taking off without sufficient coverage is the last thing anyone wants to do.
The coverage that everyone will talk about when starting your trucking company is Liability insurance. Liability insurance is a fundamental component of commercial truck insurance. It covers damages and injuries caused by your truck in an accident. It includes bodily injury liability, which covers medical expenses, legal fees, and compensation for physical injuries sustained by others, and property damage liability, which covers the cost of repairs or replacement of damaged property. These coverages help protect you financially in case of lawsuits or claims resulting from accidents involving your commercial truck. The minimum liability limit to operate for hire as a trucking company is $750,000. Still, you will want to secure at least $1,000,000 to get loads from most brokers. Should you be a hazmat carrier, you may be required to carrier limits up to $5,000,000 for liability.
Usually, what comes next is a conversation about physical damage coverage. Physical damage coverage protects your truck and trailer against damages resulting from collisions, theft, vandalism, or natural disasters. It typically consists of two parts: collision coverage, which covers damages resulting from collisions with other vehicles or objects, and comprehensive coverage, which covers damages from non-collision incidents such as fire, theft, or severe weather.
One big part of physical damage coverage that can confuse folks is how to cover a non-owned trailer while in their possession.
Trailer Interchange Coverage is an essential insurance coverage for commercial trucking companies that engage in trailer interchange agreements. These agreements involve exchanging or swapping trailers between carriers to facilitate the efficient transportation of goods. This coverage protects the insured trucking company against physical damage or loss to non-owned or borrowed trailers temporarily in their possession during the interchange period.
Bailee is a special coverage offered by one of our preferred insurance carriers Great West Casualty Company. It provides coverage for a non-owned trailer in your care, custody, or control, regardless if a contract is present. There is no time limit upon the non-owned trailer being in the insured’s possession. Trailer interchange coverage may still be needed if the broker requires it.
Non-owned trailer coverage for physical damage is another way to cover a trailer that is not owned. Typically the insurance company will cover a trailer for the market value or stated value, whichever is lower. At the same time, it is attached to the tractor and with a possible time limit.
Let’s not forget about freight itself—Cargo Insurance. Cargo insurance is crucial if you transport goods for others. It provides coverage for your cargo, protecting against damage, loss, or theft during transit. This coverage is essential to ensure the financial security of your clients and your business. Especially regarding cargo, you want to ensure the insurance company selected offers a broad form of coverage. For example, coverage for alcohol, cargo in transit more than 72 hours, consumer electronics, rough handling, wet loads, disappearance, pilferage, fraud, reefer breakdown, or spoilage. By maintaining a broad cargo policy, you will better avoid situations that may result in inadequate coverage.
Now this is different from one’s auto liability coverage. General Liability Insurance is crucial for commercial trucking companies as it protects a wide range of liabilities arising from their business operations. This insurance coverage safeguards trucking companies from third-party claims for bodily injury, property damage, and personal injury. It is essential for mitigating financial risks and ensuring trucking companies can continue operations without significant disruptions. Usually, this is seen with a 1,000,000 limit per occurrence and a 2,000,000 aggregate which is just a max payout for the policy period.
Excess Liability Coverage is an important insurance coverage for commercial trucking companies. It provides additional liability protection beyond the limits of their underlying primary insurance policies. Commercial trucking operations involve various risks, including accidents, property damage, bodily injury, and potential legal liabilities. In a severe accident or a high-value claim, the costs can quickly escalate and surpass primary insurance coverage limits. Excess Liability Coverage bridges this gap by providing higher coverage limits, ensuring that trucking companies have sufficient financial resources to handle substantial claims or legal expenses that may arise.
When determining the cost of commercial truck insurance, insurers consider various factors, including the type of truck, its value, the cargo being transported, the driving records of the drivers, and the distance and territories in which you operate. Working closely with an experienced insurance agent or broker specializing in commercial truck insurance is essential to assess your specific needs and find the appropriate coverage at a competitive price.
In summary, commercial truck insurance is a crucial aspect of operating a trucking business. By understanding the basics of commercial truck insurance, including the types of coverage available and the factors that influence premiums, you can make informed decisions to protect your assets, comply with legal requirements, and safeguard your business against potential risks and liabilities. That is why RJS Truck Insurance has continued to be a partner for over 30 years of service to the transportation industry. So call today to discover the 5-star services that have allowed us to help hundreds of commercial truck companies with their commercial insurance needs.
