Things to Know before You Buy (or Call)
In our years of experience with trucking insurance, there have been 3 main questions people ask when it comes to buying trucking insurance: First one is always about the COST. Second is about the COVERAGE they need (limits and deductibles) and more importantly – the ones they DON’T need. And third is WHICH INSURANCE COMPANY they should go with. Here is the lowdown on trucking insurance in the simplest way we could put it.
Most transportation businesses need 3 types of insurance coverage: Liability of $1,000,000 Cargo of $100,000 and Physical Damage for their equipment. Rates depend on your driving record, age, time in business, commodities hauled, radius of operation, your zip code and even more criteria. In most cases Liability premium of $1,000,000 for long haul trucking ranges between $3,000 and $4,000. Cargo is usually 1% of the total value being insured ($100,000 of cargo coverage should cost $1,000 on average). Physical damage is between 3.5 and 4% of the total value of your equipment. Of course, many different criteria play into effect when calculating insurance premium. If you are driving within 500 mile radius in most cases you will save 10 percent on your insurance cost. If you are over 45 years old you will save another 10 percent. If you have good credit you will also save on insurance. If you have less than 2 years of CDL driving experience you will pay extra. In most cases it will even be very difficult to find an insurance company that wants to insure you if you don’t have experience. If you have a bad driving record you will also pay extra. Each violation on your record will cost you approximately $1,000 more per year on trucking insurance. Accidents are rated even higher than moving violations.
Nevertheless, due to the economic slow-down in recent years, insurance companies have significantly reduced their premium rates. At no time in the past have insurance rates been as low as they are now. We, as an insurance agency, also have much to do with getting you the very best price you deserve. We constantly try new insurance companies, we continuously compare insurance companies’ rates. We have contracts with nearly every competitive insurance company in the trucking business. Here are a few examples to give you an idea f what to expect in terms of cost.
We have a customer in Oklahoma that is a hot shot operation with one 2010 dodge dully hauling 3 cars at the time that pays $1,800 for $1,000,000 in liability, $800 for cargo and another $600 for full coverage on his truck. His insurance bill for the year is $3,200.
We have a reefer operator in Texas that pays $4,800 per truck for Liability, Cargo and Physical Damage on his trucks.
We have an owner operator in Florida that has a semi truck and a dry van that pays $6,300 for his truck per year.
You can see more examples like these on our recent quotes page (click here examples of recent quotes.).
One of the biggest mistakes truck owners make when shopping for insurance is to ask many different insurance agents for a quote. This actually raises your future premium. Simply because every insurance agent you contact will send your application to the same insurance companies. It is possible that insurers give different quotes for the same trucking company. This happens because different agents write different things on the insurance application. Once an insurance company finds out that there are differences in the applications they have received from their agents they will simply refuse to offer a quote because they think that the trucking company is not telling the truth in their efforts to obtain a cheaper quote. So, shopping is a good thing, but leave to the professionals please. You asking many agents for the same thing will only make your premium higher. Let us do your dirty work, so to speak.
The SECOND QUESTION people ask when it comes to trucking insurance is the type of coverage they need and what that coverage means to them. Here is a brief explanation and feel free to call us if you have questions.
BODILY INJURY/PROPERTY DAMAGE COVERAGE (BI/PD)
Bodily Injury Liability provides coverage in the event a covered vehicle causes injury or death to another person and the insured is considered at-fault for the accident. It covers expenses related to medical costs, lost wages, sickness, death and pain and suffering for an injured third party. It also covers legal defense costs related to claims against covered damages.
Property Damage Liability provides coverage in the event a covered vehicle causes damage to any property and the insured is considered at-fault for the accident. It also covers legal defense costs related to claims against covered damages.
UNINSURED/UNDERINSURED MOTORISTS COVERAGE (UM /UIM)
UM/UIM provides coverage for damages which an insured is legally entitled to recover from another party who is considered at-fault for an accident, but is uninsured or underinsured for the level of damages.
PHYSICAL DAMAGE COVERAGE
Collision provides coverage in the event of a loss or damage to an insured vehicle caused by a collision or overturn. Collision must be written with Comprehensive or Fire and Theft with CAC.
Comprehensive provides coverage in the event of a loss or damage to an insured vehicle caused by incidents other than a collision. This includes damages due to fire, theft, vandalism, windstorm or contact with an animal.
The Stated Amount on a Commercial policy should reflect a vehicle’s current retail value including any special or permanently attached equipment. Using Stated Amount provides a superior value by allowing our insureds to customize their policy to accurately capture a vehicle’s true value. The easiest way to establish a Stated Amount is to consult a book or other publication. Other possibilities include consulting with a dealer/manufacturer or checking Internet sites. When determining Stated Amount, remember to take condition, mileage and location into consideration. Also consider any vehicle upgrades, engine or major component rebuilds that could further increase a vehicle’s value.
MEDICAL PAYMENTS COVERAGE
Med Pay provides coverage for certain medical and funeral expenses for all those occupying a covered vehicle involved in an accident regardless of who is at fault.
TRUCK AND TOW COVERAGES
Cargo covers a for-hire trucker’s liability for the property of others being transported. See the policy for complete coverage information. Coverage is for cargo that is lost or damaged due to:
› Striking of a load
› Debris removal after a load is dumped on the highway
› Earned freight to replace wages lost as a result of not delivering the load
› Reloading expenses to put a load back on the truck
MOTOR TRUCK GENERAL LIABILITY COVERAGE (GENERAL LIABILITY )
General Liability provides liability protection on risks only for injuries or property damage sustained while on
premises, using products or services. It provides coverage for personal and advertising injury, in addition to products and completed operations coverage.
NON-TRUCKING LIABILITY COVERAGE (NON-TRUCK)
Non-Trucking provides coverage to an insured on permanent lease to a motor carrier that supplies primary liability coverage, when using his/her listed vehicle for non-business, personal use. (Although this ] coverage is often referred to as “bobtail insurance”, technically it is not the same coverage. Bobtail insurance covers the tractor when it’s being operated without a trailer, whether or not it’s under dispatch.)
TRAILER INTERCHANGE COVERAGE
Trailer Interchange covers physical damage to any non owned trailer while in the care, custody or control of the insured.
RENTAL REIMBURSEMENT WITH DOWNTIME COVERAGE FOR TRUCK
This coverage provides reimbursement for a maximum of 30 days for rental costs incurred to temporarily replace an insured vehicle due to a covered loss. Reimbursement is per loss, per vehicle and is the lesser of the rental cost and the daily maximum limit. If a reasonable replacement vehicle cannot be located, the insurance company will
pay the vehicle’s daily rental limit during downtime.
ON-HOOK TOWING LIABILITY COVERAGE
On-Hook Legal Liability is a towing-specific coverage that provides physical damage (Comprehensive and Collision) coverage for towed autos and property in the insured’s custody and control. Coverage is provided for transmission/ transaxle damage. The coverage provides protection to the named insured when found liable for damage resulting from a covered Comprehensive or Collision loss.
BUSINESS AUTO COVERAGES
Hired Auto provides excess liability coverage for a non-owned, unlisted vehicle the insured has leased, hired, rented, or borrowed. See the policy for details.
ANY AUTO LEGAL LIABILITY COVERAGE
Any Auto provides liability protection for any owned vehicle listed or acquired during the policy period, and includes both Hired Auto and Employer’s Non-Ownership coverages. For Individual Named Insureds, coverage applies to an unlisted vehicle while used in the business.
The THIRD QUESTION people ask before buying trucking insurance is what insurance company and agency they should use. Obviously we want you to consider our services. Here are some of our advantages and reasons why you should go with us:
We are an Independent Agency – All this means is that we are not tied to any one particular insurer. We are free to work with anyone to get you the best quote and that is exactly what we do. As a national agency – we have one of the largest networks of insurers. We shop for your insurance with every insurance company in the country that offers trucking insurance. We do business with just about every competitive insurance company in the land.
We offer online certificates 24 hours per day. This will be a very valuable tool in your daily business operations. This service is very helpful especially when you have a truck stuck in an area and you must get him a load late at night or on a weekend. This tool will literally make you more money. If an agency does not offer this service, consider yourself paying much more for your insurance than the monthly payments.
We also offer to run MVR records on your current drivers and future drivers you may be considering to hire. This is direct saving to your company.
We offer options such as low down payment, low cost financing, insurance for those drivers that don’t have experience, and those with less-than-perfect driving records.
Roadside Service: We have a special partnership with the leading roadside assistance service for truckers and offer that service to our customers exclusively at significantly reduced rates. This alone can save thousands per year.
IF YOU WANT TO SAVE ON YOUR TRUCKING INSURANCE – YOU NEED TO TALK TO US. 888.701.1795