Following the truck payment and fuel costs, insurance is one of an independent owner-operator’s most considerable expense. Commercial truck insurance is a fixed cost, and that is why ensuring you get the best deal possible is essential if you want to keep the number of miles you drive to breakeven, low. Without having adequate insurance, an accident or cargo theft/damage claim could cripple your finances. Some larger companies such as Schneider National and Knight-Swift Transportation are said to be self-insured.
How much does commercial truck insurance cost?
Commercial truck insurance expenses can add up quickly. That is why successful owner-operators budget their premiums a year ahead. Your age, driving record, and the age and condition of your truck, the type of freight you haul, the lanes you run, and the state requirements all impact insurance costs. However, an owner operator that is just starting their business is likely to pay the following on their insurance premiums:
| Type of Insurance | Coverage amount | Premium Paid |
| Primary liability | $1 million | 6,000 USD/year |
| Physical damage/Cargo | $150,000 | 6000 USD/year |
| Non-trucking use liability | $ 1 million | $700 USD/year |
| Total | $12,700USD/year |
Leased-on owner-operators will carry similar coverage but pay less of it themselves. Usually, this is performed based on a statement deduction.
What Truck Insurance is Needed?
Liability insurance
If you are hauling freight under your authority, then you are required by federal law to have a minimum of $750,000 liability coverage. This is to protect you in a major accident in which you are at fault and to ensure that the injured parties can be compensated for their losses. You may want to increase this coverage to $1 million because most shippers and brokers will require it.
Your insurance broker will quiz you on several questions about your business and experience which they will include in an insurance packet and then forward it to the underwriter for the quotes. These questions are likely to include information about the types of commodities you move, the regions in which you drive, operating radius, previous trucking experience, and company safety and security policies. Owner-operators can help themselves get the best quote by demonstrating they have a stable business and safety management plan. Combining different coverage with one insurance underwriter can help especially if the underwriter offers a dual-deductible credit. This means that you only must pay the deductible amount once, if an accident occurs, and it’ll cover both damage and physical policies.
With more fleets installing in-cab video cameras and road facing dashboard cameras, it is likely these will become a mandatory requirement for getting insured. After all, truckers spend 90% of there work time on the road which means it is critical they have some footage or evidence if an accident happens to occur.
Damage insurance
Although not a legal requirement, physical damage insurance is usually required by lenders if you are in the store for financing your truck/trailer. Insurers will always try to total loss a used truck and repair a newer model. This is basically due to the insurer still trying to go the cheaper route. Damage premiums are calculated based off a percentage of 3-5 percent of the truck/trailer value. Your commercial driving record/abstract will also be accounted for when evaluating premiums.
Hint: when obtaining damage insurance, always ask if the expense of towing is included in your policy because it will end up costing you thousands of dollars in extra towing fees if you don’t!
Gap Insurance
Because all commercial and non-commercial vehicles depreciate massively as they are used more and more, the ability to get top dollar for you insurance settlement is crucial. If you’ve got a new truck you’re hauling freight with, then you should consider gap insurance. It will adequately cover the difference between the settlement you receive from your damage coverage and the total amount you still owe on the loan. For example, if your truck is totalled and the insurer determines the value of the truck to be $70,000 yet you still owe $110,000 in loan payments, gap insurance will make up for the $40,000 difference.
Damage deductible
Besides the premium, the other significant number is the deductible. If you are not familiar, a deductible is merely the amount of initial money you pay as part of your insurance claim. For example, the total damages of an application are estimated to be around $10,000, and a $1000 deductible means you pay for the first $1000 and the rest is covered by the insurer. Insurance is intended to protect the policyholder from sizeable catastrophic debt in the event of an accident. Therefore, smaller accident debts need not be insured which is why anything lower than your deductible is not claimable. The higher the deductible, the lower the insurance premium.
Cargo insurance
The federal government scrapped the requirement for motor carriers to hold a minimum of $5,000 in cargo coverage. However, most fleets buy $100,000 of coverage just because shippers require it to protect their freight.
Non-Trucking insurance
Non-trucking use liability is when you’re not actively engaged in the movement of cargo. Mostly, it includes most instances of bobtailing (tractor-only) scenarios.
Worker’s Compensation
This type of insurance is a requirement under the state and provincial regulations, and therefore it may already be insured through a government agency. Check with your local state/province for clarity on the rules.
Full List of Trucking Insurance Types
| Aggregate and Combined Deductibles | ||
| Aggregate Deductibles | ||
| Blanket Lessee | ||
| Collision, Comprehensive or Specified Perils | ||
| Commercial Property | ||
| Contingent Cargo | ||
| Crime | ||
| Debris Removal | ||
| Earned Freight Charges | ||
| Employee Benefits Coverage | ||
| Employment Practices Liability Coverage | ||
| Excess and/or Umbrella | ||
| Federal and State DOT authorities assistance | ||
| Fuel & Oil Delivery | ||
| Fuel, ICC, Customs, and Sub-hauler bonds | ||
| Gap Coverage | ||
| General Freight Haulers | ||
| General Liability | ||
| Hazardous Cargo | ||
| High Valued Commodities Requiring Limits of $250,000 per vehicle or high | ||
| Hired Auto | ||
| Inland Marine | ||
| Livestock | ||
| Loading and Unloading | ||
| Logging | ||
| Medical Payments | ||
| Moving & Storage | ||
| Non-owned Auto | ||
| Non-trucking Liability | ||
| Over sized and Overweight | ||
| Personal Effects for Drivers | ||
| Pollution Buy Back | ||
| Pollution Cleanup | ||
| Primary Liability | ||
| Reefer Breakdown | ||
| Refrigerated and Heated Operations | ||
| Rental Reimbursement | ||
| Sand, Stone and Gravel | ||
| SIRS and Large deductibles | ||
| Surety Bonds | ||
| Timely filing of federal and state financial responsibility filings | ||
| Towing Coverage | ||
| Uninsured / Underinsured Motorist | ||
| Various payment options | ||
| Warehouseman’s Legal | ||
| Workers’ Compensation | ||
Top 10 Commercial Truck Insurance Companies
In the complex world of Trucking and Transportation, you need to be able to rely on your insurance agent to have the expertise to service your account. Your agent should not only know where to place your account for the best rates and coverage available, but he or she should also work to assure you in compliance with Federal, State, and Local insurance regulations and meet the requirements of those you serve.
1. Hiscox Insurance
Hiscox is the expert in small business insurance. They can help you meet the minimum $750,000 requirement for liability coverage and other areas such as worker’s comp. Independent trucking contractors have found the services provided by Hiscox to be quick, thorough, and cost-effective.
If you are still going through the process of incorporating your trucking company, use Promo code “Hiscox-promo” to save 20% on incorporating filing costs.
2. Progressive
Progressive offers customized truck coverage including motor truck cargo, non-trucking liability, trailer interchange for tractor service companies, and rental reimbursement with downtime compensation.
They also help with state and federal filings which tells the government that you have the required liability insurance as per the regulations.
Progressive specializes in heavy truck claims and handle all their adjustments, in-house. They have partnered with lots of pre-approved repair shops which give Progressive customers priority.
One neat feature of using Progressive is the business experience discount which is given to truckers who have been operating under their own authority for at least three years.
3. Statefarm
State Farm is one of the leaders in commercial insurance. They offer a wide variety of products including comprehensive collision, liability, personal injury, and trailer interchange coverage.
They operate based on an agent structure, so it is important you do a little research beforehand to ensure you are getting the best quotes from all underwriters. We recommended using NetQuote to find the best insurance premium rates for trucking business policies.
4. HUB International
HUB International Transportation Insurances Services, Inc. (HUB Transportation), a leader in the trucking industry, is one of the nation’s top insurance and risk management firms. Because of this advantage, they can negotiate favorable pricing and the most appropriate coverages based on your individual needs. When you choose HUB Transportation, the most up-to-date trucking specialists, you get the advantage of keeping informed of all the current trends, risks and accidents in the trucking industry, as they relate to you. Your trucking company deserves a specific plan catered to its employee’s needs. Commercial Trucking Insurance provides quality insurance at the best price, and you’ll enjoy their exceptional customer service.
Well, we’ve discussed the top 4 commercial trucking insurance companies, but we promised you 10. Here are other options to consider:
5. Reliance Partners
6. TruckWriters
7. National Interstate
8. Northland Insurance
9. AIG Truck Insurance Group
10. 1st Guard
Things to consider when evaluating an insurance company
- The most favorable terms from insurers, considering your circumstances
- Open and honest communication to answer all your insurance questions
- No pressure. You decide for yourself the terms of your insurance and the provider
- Full compliance with all laws and regulations
- Take their commitments to clients very seriously, and if are not fulfilling your expectations, then your concerns should be addressed immediately
Hi, I would like to open up new trucking company. Can you help me out to get insurance for my company?
Can you explain me procedures? What kinda documents do I need?
That’s good to know that a trucking company needs to also get non-trucking insurance when they are not actively moving cargo and are using tractors. This is good to know since this protects the company and the products they are transporting in case a tractor malfunctions. It would be good to find an insurance that provides this and explains what else it may cover since the company may not need it if they don’t use tractors at all.
Hi, I’m looking to be appointed through an insurance transportation GA or MGA in California, can you help me?
Thanks,
Efrain Morales
That is interesting that truckers spend 90 percent of the time on the road. Maybe it would be good to get some truckers insurance if I were a commercial trucker. Then I would be covered in case anything were to happen to me while I was working.
Hello frustrated truckers! My name is Tyler and I work for the Paladin group. We know insurance rates for your industry are astronomical. Let me tell you how I can be of assistance to you…what I do is take a few pieces of information (equipment/driver and loss runs) and send it to our large network of A+ rated carriers (85 different insurance companies) and have them give us a best and final quote. Essentially, we make them fight for your business. I have been able to save many drivers 6%-12% on their policies. If you’d like me to shop your insurance around for you, contact me at the info below. I’d love the opportunity to win your business and I’m easy to work with! Hope everyone is having an amazing day!
Tyler Schepper
Transportation Solutions Expert
The Paladin Group
Office: 701-347-1250
Cell: 218-770-4258
I am considering leasing a truck and need to know approximate start up cost in order to do so. Down payments ext. Mostly I need to make sure I can get coverage.
Hello
We wanted to get a quote on trucking insurance for our company
314-517-4334
Thanks
Insurance is one of those things that people tend to parcel out to get the best prices, but you can find the best insurance coverage for your needs right here! The TWI Agency will help you to find the best policy for a price that fits your budget, so there’s no need to go back and forth between providers. Our knowledgeable agents will find the right business, home, life and auto insurance for you, saving you the time and money involved with finding the right coverage.
I’m looking for Insurance quotes for a common carrier company that has 12 owner operators with cargo,sprinter vans,1 16 foot box truck and 1-24 foot straight.
I can help with that. Out company is in the Transportation industry for Trucks. Give me a call. My Cell is 702-401-5087 and my office direct line is 505-566-4608. I have 20 different Transportation Insurance companies. We can take care of you. 35 years doing Truck Insurance.
For owner operators who have a permanent lease with a motor carrier, the average cost of semi truck insurance is between $3,000 to $5,000 per year. For owner operators with their own authority,
I would like to get your opinion about Sentury Insurance company. I got very attractive offer from them.
But reviews are not good.
I drive a 1 ton ford diesel and would like to work for hire. I don’t understand why my costs are the same as semi truck drivers.
Currently I pull travel trailers under another company’s dot number.
I would like to be able to do more with my truck then just travel trailers.
I live in Missouri.
Any suggestions?
im asking for quotation for 4 trucks
Hello, can you give me a quote on 4 trucks and 3 drivers please. Thank you
My dad is looking into doing business in the trucking industry. So now, he is looking into things he should consider such as commercial transportation insurance. Thanks for this comprehensive article which mentioned getting premiums for damages since it is a requirement from lenders when you are financing the freight vehicle.