Commercial Truck Insurance
If you’re an owner-operator or run a commercial transportation business, it’s essential to understand the mandatory and optional insurance coverages required to operate legally and safely. Here’s everything you need to know.
The trucking industry is the backbone of the U.S. economy. If you work in this sector, having the right insurance policies ensures not only security and peace of mind on the road but also helps you avoid fines and legal complications.
What Insurance Policies Do You Need for a Transportation Company?
The only legally required coverage is Combined Single Limit (CSL), also known as Liability Insurance, which protects third parties. However, additional coverages are highly recommended depending on your business operations.
For instance, Motor Truck Cargo (MTC) is often necessary because freight brokers require it. However, if your business operates without a broker, MTC may not be strictly mandatory.
Additional Insurance Coverages
Motor Truck Cargo (MTC)
The cargo you transport must be insured to protect against potential damage. The coverage amount depends on the type of goods (commodity) being hauled.
- Standard coverage: $100,000
- Higher coverage required: Electronics, high-value goods
- Not required: Low-value materials like sand or gravel
Physical Damage Insurance
This coverage protects your truck from physical damage due to various risks. The coverage amount is based on the vehicle’s insured value in the policy. It applies to:
- Vandalism
- Collisions
- Theft
- Natural disasters
Bobtail Insurance
Also known as Non-Trucking Liability, this coverage applies when the truck is used for personal reasons rather than business operations.
✅ When is it valid?
- Driving to a repair shop and getting into an accident
- Picking up the truck from a dealership
- Running personal errands (e.g., grocery shopping) after dropping off a trailer at a truck stop
🚫 When is it NOT valid?
- When the truck is hauling a trailer
- When the truck is being used for income-generating activities outside its primary business purpose
Trailer Interchange Insurance
This insurance covers physical damage to trailers you don’t own, protecting against:
- Collisions
- Theft
- Fire
- Explosion
- Vandalism
For example, companies like Amazon provide their own trailers for freight shipments. If you’re using your truck but hauling Amazon’s trailer, you’ll be required to have Trailer Interchange Insurance to protect their equipment.
Health & Life Insurance for Truckers
Health Insurance
Medical insurance is essential for covering any healthcare expenses resulting from accidents. As a trucker spending long hours on the road, protecting your health is a must.
Life Insurance
A life insurance policy ensures financial security for your family in case of disability or fatal accidents while on the road.
Final Thoughts
If you own or plan to start a transportation business, understanding the importance of proper insurance coverage is crucial. Choosing the right policies not only ensures compliance with legal requirements but also protects your assets, business, and loved ones. At Protecto Solutions LLC, we provide tailored insurance solutions to keep you covered at every step of the journey.
📞 Contact us today to find the right coverage for your trucking business!