Owner Operator Truck Insurance: Coverage and Getting Cheap Quotes

Admin July 22, 2019 Commercial Truck Insurance

Every business with trucks needs commercial truck insurance that is tailored to your business’s specific needs. No two companies are alike, so their coverage needs are also different. Finding the best and most affordable commercial truck insurance for owner operators starts with understanding the kinds of coverage available. 

What are the types of commercial truck insurance?

Just like with your personal auto insurance, there are various options available. Make sure to know what kind of coverage you need so you can get the best-fit package for your business. Here are some of the most common types of truck insurance:

General liability coverage

General liability coverage is required in every state across the U.S. It protects the commercial truck’s driver for property damage or bodily injuries against liability. Insurance companies typically offer ranges from $35,000 to $1,000,000. 

Physical damage coverage

Physical damage coverage pays for the repairs of a commercial truck or trailer damaged via theft, collision, vandalism, or natural disasters. If the truck is damaged beyond repair, It can be replaced. The price of the vehicle sets commercial truck physical damage insurance premiums. 

Motor truck cargo coverage

Motor truck cargo coverage protects the driver of a commercial truck if the cargo is damaged or lost. Freight type determines the monthly premium, and coverage often sits between $10,000 and $100,000. 

Trailer interchange coverage

Trailer interchange coverage protects commercial truck drivers against property damage liability when they are using a vehicle not owned by the company. 

Bobtail coverage or non-trucking liability

Bobtail coverage applies when a driver is using a company vehicle for personal reasons. During these times, the owner-operator is not covered by the primary coverage. Bobtail coverage does not protect drivers when they are using a truck to make money or driving for your company.

Truck insurance ICC (Interstate Operating Authority)

Truck Insurance ICC is a federally-regulated permission required for every truck transporting cargo between states. 

Getting a commercial truck insurance quote

Companies will offer vastly different kinds of commercial truck insurance packages. It can be challenging to get side-by-side comparisons, but it is essential to look at each piece of what is being offered. 

When working with a commercial insurance company, you should be prepared to provide this information:

  • Who will be driving your trucks?
  • What kind of driving records do your drivers have?
  • Do your drivers have training or certifications?
  • Will your trucks be in construction areas?
  • Will your trucks be hauling heavy equipment or hazardous materials?
  • How many miles will your drivers commute each year?
  • Will your trucks cross state lines?

Price factors

Seven primary factors impact your commercial auto insurance policies:

1.    USDOT Authority

Leasing trucks from another company can save you money since the leasing companies typically cover their drivers’ primarily liability. These drivers, however, often need to carry their own bobtail coverage. If you are operating under your own authority, your USDOT operating history will be a factor. Even a single violation could put you at risk for a higher rate.

2.    Contractual requirements

The Federal Motor Carrier Safety Administration (FMCSA) often mandates a minimum liability limit of $750,000 to $1,000,000 for truckers who need a federal filing. Other contracts require additional coverages beyond state minimums.

3.    Cargo

The type of cargo you carry will affect your overall commercial insurance price. Some cargo is just riskier to transport than others. For example, there is a higher risk of injury when carrying hazardous materials versus carrying fresh produce.

4.    Operating radius

The larger the operating space, the higher the risk involved. More time on the road, less familiar routes, and more frequent stops all increase the overall risk on the road.

5.    Vehicle type

A lighter truck will typically have a lower premium than a heavy semi since it will cause less damage if there is an accident. Newer vehicles will also often have a higher price since they cost more to repair or replace.

6.    Driving History

Even something as small as a minor speeding ticket on a truck driver’s record can cause a drastic increase in insurance costs. Hiring drivers with a clean history can save hundreds or thousands of dollars on a commercial truck insurance policy.

7.    Location

Commercial truck insurance rates vary by state. State’s also have required minimums to which you must adhere.

Getting the most affordable quotes

Owner-operators are often looking for cheap insurance rates. In reality, they are looking for the best value to fit their business needs. Getting the best value means finding a combination of competitive pricing, customized coverage, and excellent customer service. There are three tips to consider when looking for your best value coverage.

1.    Adjust coverages

While you certainly do not want to go without the proper amount of coverage, there may be some adjustments you can make to lower the price. For example, raising your deductible will lower your monthly rates, even if it means paying more after an accident. You should, however, be satisfied with the coverage you choose. Paying less means less protection.

2.    Consider monthly payments as well as annual payments

Many insurance companies offer discounted rates if you pay for an entire year at once. This can be a great way to save money, but it may not be in the budget. While it may cost more annually, it may be worth making monthly payments that are easier to manage.

3.    Ask for discounts

Always make sure to ask if there are discounts available. Insurance companies may not bring discounts to your attention without asking. Things like paying in full, CDL-holding drivers, or business experience can lower the total cost.

What tips do you have to get the best value price on commercial truck insurance? Please comment below.