Truck Insurance: Description Of Truck Insurance

It is illegal to own a commercial truck and not have truck insurance. Not only is it illegal, but the results of an accident can be an exorbitant cost if you have to pay out of pocket. Truck insurance is mandatory in 50 states and if you are caught without insurance, you will face hefty fines, and you may even lose your license or end up in jail.

Truck insurance is reserved for commercial trucks, such as:

  • Box, semi and pickup trucks.
  • Tractors, flatbeds, trailers and tanks.
  • Front loaders, garbage trucks and dump trucks.

A truck driver who is an employee and drives a company truck may be covered by his employer’s master truck insurance policy. It is wise to know the details of your employer’s policy and purchase additional coverage if you feel there are areas where you are insufficiently covered.

An owner operator is someone who owns his truck and works on contract. As an independent contractor you are entirely responsible for the resulting costs and liabilities due to an accident, so make sure you are fully covered with truck insurance.

Truck insurance tends to focus on the significant damage a big truck can inflict. It also takes into account the damage your cargo can do if it lands on other drivers and their vehicles, as well as the effect that spilled cargo can have on the environment. Your insurance will cover you, your truck and your cargo, as well as damaged property in the accident’s vicinity. You can also purchase insurance to cover any other injured drivers and their vehicles if you do not live or drive in a state with no fault insurance, or if the other driver does not have insurance.

Truck Insurance: Description Of Truck Insurance

When deciding on what coverage to get, first decide what coverage you need. Ask yourself the following questions:

  • What are the common types of accidents in my industry?
  • What are the different scenarios that could happen with the different types of cargo that I ship?
  • What type of coverage works best for other companies that have similar issues and scenarios?

Ask your peers about their truck insurance coverage. Also, contact several insurance companies and ask them about their different products, then decide which company will provide you with the best policy and protection.

As a trucker, you know the dangers of the road; you need to financially protect yourself and those around you.

Truck Insurance: What Does Truck Insurance Cover?

Big commercial trucks can cause a lot of damage and that means expensive repairs and can also mean high medical bills for serious bodily injuries. There are several categories of truck insurance that are important for a truck driver.

  • Truck liability is the least amount of coverage you can have and is mandatory if you want to drive a commercial truck. Liability coverage under your truck insurance policy will financially protect you while you are on the road. It will cover the legal, medical and any possible funeral expenses for injuries. It will also cover the repair or replacement costs of property damages sustained due to an accident for which you are responsible.
  • Non-trucking liability, also referred to as bobtail or deadhead coverage, is for any incidents that occur while you are not working. This includes while you are parked or running errands on your personal time, or while your truck is being repaired or washed.
  • Motor truck cargo coverage is to insure your cargo. This is to cover you and your customer in case the cargo does not make it to its destination. Motor truck cargo coverage is not mandatory; however, many of your customers will insist you have this type of coverage before they will sign your contract.
  • Truck damage coverage will pay the repairs costs of damage to your truck and trailer. It is also not a mandatory coverage; however, your money lender will insist you carry damage coverage. You can be covered for collision, fire, severe storms, theft and vandalism, as well as any other perils you list in your policy.
  • Truck Insurance: What Does Truck Insurance Cover?
  • Occupational accident, or Occ/Acc, is similar to workers compensation. As an owner operator, you will be required to carry this coverage.

Some other types of coverage available through your truck insurance are:

  • Roadside assistance: very affordable and very important.
  • Unidentified trailer coverage for a trailer that you do not own.
  • Refrigeration breakdown endorsement to cover the cost of replacing spoiled cargo.
  • Terminal storage (for short term), or warehouse storage (for long term) damage coverage for your cargo while it is in storage.
  • Personal effects coverage for incurred damage or theft of your personal property.
  • Uninsured motorist coverage if the other driver is not insured.

Whether you are your own boss or you drive a company truck, make sure you are financially covered for any accident that may occur.

Truck Insurance: Rates For Truck Insurance

Truck insurance is an expensive investment. However, you will find that the mandatory truck liability portion is the most expensive and the rest of your coverage is very affordable.

The minimum allowable liability coverage for a truck with a gross vehicle weight rating of 10,000 pounds or more is: $750,000 for non-hazardous cargo, $1,000,000 for hazardous cargo, and $5,000,000 for explosive cargo. This coverage will be at least $1,700 per year.

The good news is, the rest of your coverage is very affordable and there are discounts:

  • Obtain your commercial driver’s license (CDL) and you could earn a 20 percent discount.
  • Have at least three years of business experience.
  • Have had a general liability or business owner’s policy for at least one year with no lapses in coverage or missed premium payments.
  • Pay for your policy in a lump sum up front and you could get a 15 percent discount.
  • A higher deductible means a lower premium.
  • Insure all of your vehicles with one insurance company.
  • Install safety instruments in your truck, including airbags, four anti-lock wheel brakes, electronic stability control, hill start assist, trailer sway control and a fuel cut-off device.
  • Install anti-theft devices including an alarm, GPS tracking and smart key technology.

Your truck insurance premium is based on a number of factors, including:

  • Your age. As with all vehicle insurance, a young driver will have a higher premium.
  • The make and model of your truck.
  • What you will be hauling.
  • Your driving experience. The more years of experience you have the lower your premium.
  • The number of years you have been employed as a truck driver.
  • A clean driving record with no violations or accidents.
  • Your insurance history. Past incidents of canceled policies due to non-payment of premiums can increase your current premium.
  • Where you drive. Depending on your level of risk for accidents your premium could be higher or lower. For example, a truck driver that often drives through cities will have a higher premium than a truck driver that is mostly on highways in farming country.
  • Your Department of Transportation (DOT) safety rating. Your premium will be adjusted according to inspection records, compliance, safety training, violations and recorded accidents in your DOT profile.

Once you have budgeted for your mandatory truck liability coverage, the rest will be easily affordable.

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