Semi Truck Insurance: Cost and Coverage

Admin June 29, 2018 Commercial Truck Insurance

Semi truck insurance, also known as owner-operator insurance is a liability cover for injuries or damages caused to other parties when the driver is at fault. Other types of a cover may be added depending on several factors that are special to the driver. On average, semi truck insurance costs for leased owner-operators can range from $1,500-$2,000 per year. If you are an owner-operator with your own authority, the costs range from $9,000-$12,000 for each truck you own. For new authorities, the new pricing is a bit higher in recent years and ranges from $12,000-$16,000.

Factors that determine the cost

Several factors come into play when deciding how much you are going to pay each year. Plus, different insurance companies will have put more weight on some factors than others which will skew the rate either higher or lower. These include:

The type of cargo that you haul – hauling hazardous material such as fuel will cost higher premiums than, let’s say, hay.

The weight of the load – heavier freight will translate to higher rates.

The distance you travel – if you travel for a longer distance, the premium rate will be higher because you are exposed to a greater risk of an accident.

The value of the truck – in determining the physical damage premium, a percentage of your truck value is used to come up with the figure. If your truck has a higher value, then the more premium you will pay.

Your credit history – credit scores and history are having a major influence in helping insurance companies decide how much premium you will pay. A favorable credit history assures the insurer that you can pay premiums and hence lower premiums. A poor credit history will warrant higher premiums.

CDL experience and driver’s age – a longer commercial driver’s experience means you have a lower risk and hence you will pay lower premiums.

Coverage limit– a higher coverage limit means a higher premium rate and vice versa.

Deductible amounts – higher deductibles translate to lower premiums.

Claims history – if you have a zero loss history, then your premiums will be reduced.

Payment plan

The different coverages and the average cost

Generally, the type of policy that you need and the type of truck that you drive will determine the cost you will pay. Motor carriers bear the responsibility of providing for primary liability. If you are a trucker with your own authority, then you will cater for primary liability plus, bobtail, NTL plus any extra costs that may arise.

1. Primary liability ($5,000-$7,000)

This covers the damage that happens to others as a result of your driving. It does not necessarily cover your own semi truck.

2. Physical damage ($1,000-$3,000)

Offers coverage for damages caused by natural disaster, collision, vandalism, and theft that results in actual physical damage of the truck.

3. General liability ($500-$600)

A general liability insurance has a much broader application and covers a majority of what is not covered by primary liability. It applies to the business itself and not the trucks.

4. Bobtail insurance ($350-$400)

Bobtail insurance covers the driver and the truck when they are not hauling any load, especially when traveling between jobs. It applies to a semi-truck with no trailer attached.

5. Umbrella policy ($500-$700)

Provides protection above and beyond general liability, auto liability and worker compensation.

6. Occupational accident ($1,600-$2,200)

Compensates for work-related injuries as well as provide income benefits and medical payment.

7. Cargo coverage

Cargo coverage varies according to the cargo limits required for each type of cargo.

8. Non-trucking

Non-trucking liability covers damages and injuries to third parties that are caused by a lease driver while for non-business purposes.

When shopping for the best semi truck insurance quote, it is best to compare offers from several companies in the market. It is always a bit hard to find a one-size-fits-all coverage for your semi truck since most insurance companies do not explicitly write all the trucking risks. However, if you dig a little deeper, you might just find the right company to fulfill all your needs.

Extra knowledge will also help in reducing unnecessary costs that come along. For example, you might have to consider higher deductibles or lower coverage limits if you want to save the extra coin in premium rates.