WHAT YOU NEED TO KNOW ABOUT INSURING YOUR TRUCKING BUSINESS

WHAT IS COMMERCIAL TRUCK INSURANCE?

Trucking is a booming business which is responsible for most of the overland freight movement in the United States, with the market being worth 419.22 billion U.S. dollars in 2020 and is increasing exponentially due to the pandemic; causing the delivery demands to explode, consequently, spurning a dire need of new trucking businesses. 

Insurance is a financial product that reduces or eliminates the cost of loss or effect of loss caused by different types of risks. Commercial truck insurance is mandatory for a plethora of reasons. The prime reason being it is a legal requirement to operate your truck; moreover, it shields the owner from all the probable and Improbable threats.

Trucking insurance starts with liability insurance. However, you can also include other coverages. There are other coverages such as bobtail coverage, cargo insurance, rental reimbursement, trailer interchange, reefer breakdown coverage, and uninsured motorist coverage.

PURPOSE OF TRUCKING INSURANCE:

The following reasons give insight to why is insurance important and the circumstances when it is applicable:

• It can safeguard drivers and owners when involved in accidents.

• It can cover physical injury costs to the insured driver.
• It can cover damage to property due to natural disasters.
• Trucking insurance can cover theft or loss of cargo.
• Certain trucking insurances can cover comprehensive coverage of extensive overhaul repairs.
• Additionally, it also offers a variety of coverages that are widely utilized by trucking businesses throughout the nation.

However, the following criteria will not be covered on most insurances:

• Drunk Driving
• Driving with no license.
• Negligence while driving.
• Damages caused by carelessness.
• Damages made by the irresponsible behavior of the driver.

FUNCTIONING OF TRUCKING INSURANCE:

The insurance is significant for the usage of owners who own the trucking business or have ownership of the vehicles. Certain factors have a major emphasis on deciding the premiums that are to be paid monthly, according to the agreement of the chosen policy.  Trucking insurance protects people, property, your company, and yourself from any accidents your trucks can cause. There are also several optional coverages you can get to avoid unexpected expenses that can put a trucking company out of business.

ELIGIBILITY PREREQUISITES: 

The commercial trucking business is Incredibly competitive and immensely profitable and therefore requires the following to procure the insurance services:   

• Legal documentation needs to be submitted in affiliation with the State and Federal law stating that the company has sufficient coverage to cover both the trucks and the goods. The FMCSA will require proof of insurance in order to allow you to get your trucking authority packages. $750,000 minimum liability insurance is required for most trucking companies. However, the customers you haul for may require more.

Financial stability provides protection in case of accidents, loss of cargo, physical or overhaul repairs too. The FMCSA articles provide strict laws to be followed in such cases.

COST OF COMMERCIAL TRUCK INSURANCE:

• The prices of commercial truck insurance are not fixed which is a case like Auto Insurance. 

• The premiums will vary according to the opted policy and the risks involved.

• Factors such as the type of freight, weight of cargo, hazardous material, etc determine the risk. The higher the risk, the higher the cost.
• Individual insurance company’s policies and terms might vary accordingly. Their policies and terms determine who they’re willing to insure or not.

Your trucking insurance needs will change, as your company grows. Do your research and talk to your insurance agent about the different types of coverages offered and what it means for your business. Trucking insurance doesn’t have to be a burden expense and can offer you peace of mind as a trucking company owner.