The Keys to Get The Most Out of Trucking Liability Insurance

Admin May 11, 2018 Commercial Truck Insurance

Are you a trucking fleet manager or business owner that has not yet insured your trucks? Or are you looking to get into the trucking and cargo transportation industry? The first thing to do in the process of making sure your company needs are met is to clearly define what your business needs are.

This way when you sit down with an insurance agent or broker you will get the most out of your trucking policy. This way, your agent or broker will be able to find various products that are right for you and your business.

As they begin to determine what will be the best way to get your needs met, it is important to keep in mind within the insurance marketplace there are set requirements for the industry, such as Trucking Liability Insurance.

What is trucking liability insurance?

Trucking liability insurance is the main policy you need as required by law to cover your business in any possible accident with a third party. The policy provides a baseline coverage for injuries or damages caused by any accidents by your trucking fleet. It is the basic and the primary form of insurance which is responsible for covering both the bodily injury and the property damage.

This is a mandatory insurance policy on all commercial trucks. Driving a truck without any trucking liability insurance may lead to serious penalties and fines charged. It is a legal requirement by the state governments and the federal agencies who, in addition, demand proof of the insurance be provided to them for the operation of your business.

This insurance is also termed as an auto liability insurance as it is a compulsory insurance covering each and every commercial truck. In an event of an accident, one can then file a claim with the insurance company seeking to be indemnified. The insurance company then reviews the policies in effect and determines whether to accept or reject the claim. In addition to this, the third party affected by any type fault from your trucks or drivers can also claim compensation for damages and losses caused to them.

They will seek compensation for the use of your trucking insurance policy in which the insurance company will cover them their total damages and losses up to the limit of your policy.

How does a liability policy work?

The trucking liability insurance will provide coverage for your property, bodily injuries, and third-party damages and losses caused by any type of accident your truck may cause. As it is the primary insurance for your truck, the trucking liability insurance will involve a variety of coverage types as it remains the center of your policies in the commercial trucking industry.

Due to the large number and types of coverage offered by this type of insurance, the trucking companies and some semi-truck, or independent drivers will prefer the purchase of a commercial umbrella insurance policy. This is a policy which covers a large number of liabilities during a time of compensation compared to the normal trucking liability insurance. The commercial umbrella insurance will assist in getting higher compensation limits in higher increments of up to $1,000,000 on some policies, which will be able to cover most liability costs. This assists in having increased protection for your business and meeting the requirements of having a trucking liability insurance policy.

The insured will determine the limits on the coverage amounts as well as the deductible amounts. After the coverage has been determined by your agent or broker, the insured will keep paying the premiums on the accepted time frames according to the contract term agreed.

In the case of an accident, the insured will then file a claim to the insurance company for compensation on the damages and loss incurred. In addition, the third party will also use the owner’s insurance policy in filing a claim for damages and losses done to them or to their property.

The insurance company then does an investigation on any claim and they will either accept or reject the claim. It is based on the cause of the situation and will assess any loss to both sides and damages to the truck.

What will trucking liability insurance cover?

Trucking liability insurance coverage amounts on each item below are determined by the trucking company or the truck owner based on their needs and the carrier they selected.

The general coverage of the trucking liability insurance can include the following;

  • Liability on property damage to third parties
  • Bodily injury liability to third parties
  • Personal injury liability of employed drivers, and authorized passengers in the truck. This will compose the medical expenses and the lost wages that arise due to the damage and loss.
  • Coverage of collision during an incident of an accident. This will compensate all the costs related to the accident without any consideration of the person at fault.
  • Non-collision damage costs coverage in their summation
  • Treatment, hospitalization and any funeral costs coverage on the affected persons
  • Underinsured or uninsured motorist coverage
  • Unloading and any loading liabilities
  • Labor costs

What is the cost of coverage and one that is needed for the trucking liability insurance?

There are no fixed costs in which you should use in getting your trucking liability insurance.  Everything is determined by the need of the business owner and the trucking insurance policy they select that meets the federal and state requirements as well as the needs of their company.   

The trucking liability insurance carriers will typically provide a minimum on which you are supposed to ensure your truck. In addition to this, they also offer a recommendation on the coverage setting it at $500,000 to $1,000,000 which would reduce any risk that would lead the affected trucking company or truck owner to be forced to use their finances on an accident.

In addition to this, there are other minimums set by the Federal Motor Carrier Safety Administration (FMSCA) in which it includes the following;

  • $750,000 – A minimum of $750,000 in most trucks that transport a variety of commodities in which most brokers will need a minimum of $1,000,000.
  • $1,000,000 – The auto haulers will be required to use a minimum of $1,000,000 on their coverage and it is becoming the main coverage in the trucking industries.
  • $5,000,000 – This is the minimum limit for shipping of hazardous materials.

How do I choose the right coverage for my business?

Choosing the best coverage will require an insurance advisor on the available choices you have for you to get a trucking liability insurance policy. You will be able to set the best policy at your best-preferred cost that meets all business requirements.

What are the limitations and exceptions based on the trucking liability insurance?

Trucking liability insurance has some limits in which you can not use this type of insurance in every part of your business. There are some aspects of tracking that are not covered, and in that case, there are other policies that are available for when the truck is not operating for business purposes, etc.

The following include some of the vehicles that exempt from the use of this insurance;

  • Cement trucks
  • Garbage trucks
  • Hearses
  • Buses
  • Passenger Vans
  • Ice cream trucks

With the increased risk involved in the trucking industry, there is a high need to ensure third parties. This will not only increase customers to trust your company and other business you are involved with, but they will also enjoy working and receiving services from you. This will increase your customer base and consequently lead to the success of your trucking business.