If you spend less time making money and more time trying to keep up with new regulations on insurance for truckers, you're not alone. Trying to determine policy needs is frustrating when working with an agent who needs help understanding the trucking industry.

The need for good truckers' insurance has never been greater than today. There is a shortage of truck drivers, and truck accidents show a 28% increase in 2020. You need to manage risks to prevent unrecoverable loss.

Large truck crashes were the cause of 4,014 deaths in 2020. Sixty-eight percent of those deaths were occupants of cars; the other 15% were in the truck. The remaining 16% were people on motorcycles, bicycles, or pedestrians.

Consider the risks to your business and the cost of a potential lawsuit if an accident occurs. Coverage needs to be sufficient to handle all losses.

Coverage must cover repairs to the truck, cargo damage, and medical bills for vehicle occupants if your driver is at fault.

Without adequate insurance coverage, an accident may bankrupt your business. Guarantee the longevity of your business by learning about the kinds of insurance available for truckers in this guide.

Why You Need Commercial Truck Insurance

The risk of loss for commercial trucks is great. Driver fatigue, traffic flow, vandalism, and cargo theft are obvious threats. Don't forget damage from natural causes, including hailstorms, rain, and wind.

Even the most alert driver can't prevent a car from cutting them off on the roadway, resulting in an accident. You can't cover the financial loss you may experience without proper insurance.

FMCSA Minimum Requirements

Every freight forwarder, broker authority, and the motor carrier must have adequate insurance. The Federal Motor Carrier Safety Administration (FMCSA) sets forth the minimum requirements:

• Public Liability Insurance (including bodily injury, property damage, environmental restoration) -  $5,000 to $750,000 (depending on what is being carried), $300,000 for non-hazardous up to 10,001 lbs.
• Cargo Insurance - $5,000 per vehicle, $10,000 per occurrence for carriers of household goods
• Service of Process Agent person who may receive service of legal papers
• Endorsement for Motor Carrier Policies of Insurance for Public Liability under §§29-30 of the Motor Carrier Act of 1980

Endorsement for a motor carrier is mandatory for hazmat safety permit carriers.

The FMCSA may have more form requirements. That will depend on the type of trucking business you have and the type of cargo you carry.

Every registered commercial vehicle has an assigned Department of Transportation number. You cannot obtain your DOT number without proper insurance.

Protect Your Business

Commercial trucking is a lucrative but expensive business to run. A new semi-truck will cost you between $80,000 to $200,000, depending on the number of custom features you select.

You have a huge investment putting one truck on the road. Multiply that by the number of vehicles in your fleet. Add to that the cost of wages for the drivers, truck maintenance, gas, repairs, and other miscellaneous expenses.

You invest hundreds of thousands into the most critical tools in your business. Don't skimp on insurance.

Now is the perfect time to build your business. You can grab business during the current labor shortage among truck drivers. Invest in the future by adding more insured rigs and drivers to your fleet.

According to the American Trucking Association, the industry is down about 80,000 drivers. This prevents the current truckers from meeting the shipping demands of the U.S. Adding to this is the problem of truck driver age.

The average truck driver is 55 years old, meaning they reach retirement age within the next ten years. Now is the time to grab younger drivers just starting out. Make sure they have adequate training and insurance, preventing a labor shortage in your business.

Auto Liability Insurance

When purchasing auto insurance for truckers, it is mandatory to have auto liability. This covers property damage and bodily injury. The coverages activate if you experience an at-fault loss.

Bodily injury covers the cost of:

• Hospital bills
• Rehabilitation
• Physical therapy
• Lost earnings
• Long-term nursing care
• Other medical bills
• Funeral expenses if the accident results in death

The property damage portion covers items that suffer damage in the accident. This includes repairing or replacing property, buildings, signs, and more.

Auto liability covers third-party injuries and property damage. It does not cover damage to your truck, injury to your driver, or theft of the semi.

You use auto liability to protect business automobiles, not hauling cargo. This covers sales staff and owners who drive company vehicles but don't operate big rigs.

Auto liability will not satisfy a client's proof of insurance request. Clients want to confirm you have adequate coverage for their cargo.

You must comply with the law and your customers as a commercial trucking business. Review all commercial insurance options for truckers with a Transportation Risk Specialist. They will ensure you get the coverage you need to keep your business lucrative.

Bobtail Insurance

This special insurance provides coverage for times the truck cab is on the road without a trailer. Do not confuse this with non-trucking liability insurance. Non-trucking liability is coverage for the personal use of the truck.

Bobtail insurance covers times such as when you drop a loaded trailer. The driver then travels with the semi-cab to another location to pick up a load.

The time with no load on the back of the truck is when the bobtail insurance is necessary. This policy provides coverage if you drive the truck to a service center. It also covers your driver taking the rig home overnight or using it for errands.

Cargo Insurance

Cargo insurance for truckers protects the shipment. Once the cargo is on the trailer, the trucking company is responsible for maintaining the shipment's integrity. Responsibility is continuous from the FOB point until sitting on a dock at the landing point.

When purchasing cargo insurance, make sure the policy provides coverage for the type of commodities you will be hauling. If the cargo suffers damage during the transportation period, this insurance covers the cost of the vehicle and its contents.

Commercial Property

As a trucking business, you need to purchase insurance that covers your trucks, their cargo, and the buildings where you have your offices, maintain service and parts, and more.

When purchasing commercial property insurance, consider the potential areas you may suffer loss. This includes all building structures, machinery, furniture and equipment, business records, signs, fences, warehouses for cargo, and more.

When obtaining your quote for truckers' commercial insurance, remember to include all areas of the business.

General Liability

General liability insurance covers claims that arise from daily business operations. This may include property damage, medical bills, or injuries if a truck driver suffers an accident. It also provides coverage for injury to a person not normally on your property, such as a client's slip and fall in your parking lot.

Liability insurance provides legal compensation if your driver is in an accident, the other party files a lawsuit, and your company is found liable. Plaintiffs in truck accident cases win 71% of the time, with an average jury award of $532,034. The award is often over $1 million if the accident is fatal.

Hazmat Insurance

This type of insurance is for those hauling hazardous materials and waste. State and federal laws regulate the hauling of hazardous materials, including the insurance coverage you must have. This is because of the high liability if an accident happens.

For instance, in July 2021, a tanker hauling 14,000 gallons of gasoline and diesel fuel missed a curve on I-75 in Michigan. The semi hit the median and burst into flames after flipping onto its side. The massive fire took two hours for firefighters to extinguish and several more hours for cleanup before the expressway re-opened.

The driver's negligence and the resulting accident caused structural damage to the pavement. Portions of the highway divider melted from the heat of the fire.

Hazmat insurance for truckers is valuable coverage if your driver gets into an accident. Talk to a transportation risk specialist (TRS) at Hummel Group about your trucking company insurance needs. They understand the state and federal requirements for all areas of the trucking industry.

What Is a Transportation Risk Specialist (TRS)?

When you see TRS next to a risk management or insurance professional's name, the letters signify the person has extensive training in the field. They have gone through rigorous specialized study and meet the following qualifications:

• Dedicated work experience with a minimum of two years in the motor carrier industry
• Regular progress evaluations
• High standards of integrity
• Commitment to maintaining a level of expertise and understanding of the transportation industry
• Regularly participate in educational opportunities
• Passed a rigorous written exam
• Active membership in TRS
• Attend at least one of five programs regarding the industry every two years

TRS agents know more about truckers' insurance than 99% of other agents offering truckers' insurance. Hummel Group has two TRS agents to help you with all your motor carrier insurance needs, including underwriting.

Health Insurance

Health insurance for truckers can be costly and difficult to find. Some trucking companies offer health insurance to employees, and if your business is trying to attract drivers, a health insurance benefit may draw them in.

According to the CDC, long-haul truck drivers have a higher incidence of smoking, obesity, high blood pressure, low physical activity, and diabetes mellitus. Health problems may affect your driving ability and cause you to lose your CDL.

Preventative health care is the best way to maintain your ability to continue driving. If you are a driver without health insurance, consider comparing individual and family policies, including dental, vision, hospitalization, and critical care coverage.

Hot-Shot Trucking

There are 3.5 million truck drivers in the United States, so insurance to protect cargo and drivers from financial ruin is essential. Hot-shot trucking insurance helps keep you safe, avoid fines, and minimizes damages following an accident.

Hot-shot trucking is a type of cargo transfer where small, time-sensitive loads need to be delivered to a single location. Hot shot truckers own their own trucking business or work for small organizations.

Even with small-load shipping, you must follow the law and purchase commercial insurance before putting your truck on the road. If you skip insurance, the resulting fines can destroy your business financially.

Life Insurance

As a business owner, you do not need to provide life insurance for truckers, but it is an excellent benefit to offer. Discuss purchasing life insurance with your insurance agent if you are an independent driver or owner-operator.

Because of the hours, truck drivers spend on the road, it is a risky career. There is always the possibility of an accident.

Life insurance provides coverage for the driver's funeral expenses and helps remaining family members stay financially secure while adjusting to the loss. Policies are available in both term and permanent life insurance plans.

Livestock Hauling

If your trucking business sometimes hauls livestock, you need a special endorsement to cover this risk. If you transport a load of sheep, cattle, pigs, or any other live animal, you need coverage for loss if the animals suffer injury, heat exhaustion, or second deck collapse.

You must also consider the possibility of animals escaping, especially in the event of an accident causing a trailer to tip over. The time and cost of capturing the animals can add up quickly.

Non-Trucking Liability

A non-trucking liability policy provides protection if an accident occurs while using the rig for personal purposes. If you or a driver use the rig for any personal errand, including grocery shopping, hauling dirt for their garden, or going to the movies, this coverage would pay in the event of an accident.

The details of when this insurance vs. bobtail insurance provides coverage vary from state to state. Discuss what best fits your needs with your trucking and transportation insurance specialist.

Owner-Operator Insurance

Business owners also need special insurance coverage when they operate their trucks.

If you lease a truck from a trucking company, that company's truck insurance covers the vehicle, third-party liability, and damage to the truck or property. The operator is responsible for damages for any other casualties if the owner-operator is at fault.

The FMCSA requires owner-operators driving their commercial trucks to purchase auto liability coverage at a minimum of $750,000.

Physical Damage

Physical damage insurance is a general term for three types of coverage: collision, comprehensive, and fire and theft.

Collision insurance covers the damages your truck incurs during an accident. The insurance pays to repair or replace the semi following an accident.

Comprehensive insurance covers other damages that are not the result of an accident. For example, a stone cracks your windshield or theft of the semi.

Fire and Theft insurance is similar to comprehensive coverage, but coverage is specific to damage from fire and theft.

This coverage is essential because not all damage happens on the road. While parked in the yard, trucks can become victims of theft, vandalism, fire, and more.

This coverage does not cover cargo, nor does it pay for the driver's personal items, such as chains, binders, tools, electronics, and other non-permanent equipment on the tractor or trailer.

Rental Reimbursement

If your big rig is totaled in an accident, that loss causes a severe impact on your business receipts.

If you have a rental reimbursement policy, the cost of renting a truck for use while your rig undergoes repairs can keep your business operating on a normal schedule.

The average rental reimbursement policy will provide coverage for 30 days of rental if necessary due to truck downtime.

Trailer Interchange Policy

This unique policy covers damages if you tow the trailer of another truck. Standard commercial truck policies cover cargo in your trailers. They do not cover the contents of trailers belonging to another driver or company.

The interchange policy covers the insured driver's legal liability. This coverage is essential if the driver causes damage to another company's trailer when using it to haul cargo.

Umbrella Liability

Umbrella liability provides coverage when your insurance policy does not cover your loss. For instance, your driver crashes into a building. Your driver's injuries are paid through workers' compensation, but that policy doesn't cover property damage.

Your commercial liability is what pays the claim for property damage, but your policy may not be sufficient to cover the total loss. The umbrella policy covers the difference.

Underinsured or Uninsured Driver

Not all auto-truck accidents are the fault of the trucker. Distracted drivers may run into your truck, causing damage. If the at-fault driver does not have insurance or their insurance is insufficient to cover the repair costs, this coverage helps pay for your loss.

Uninsured motorists accounted for 12.6% of the drivers on the road in 2019. The actual number you may encounter varies by state, with Mississippi and Michigan having the highest number, at 29.4% and 25.5%, respectively. New Jersey has the least at 3.1%, then Massachusetts at 3.5%. The coverage is mandatory in some states but a good idea no matter where you conduct business.

Depending on what state(s) you conduct business in, there is a good chance you may encounter an underinsured or uninsured driver in an auto-truck accident.

Workers Compensation

Workers' compensation insurance is mandatory in the majority of states. If an employee suffers an injury at work, this insurance pays their loss of income, medical bills, rehabilitation expenses, and more. The coverage is for every employee, including drivers, warehouse workers, and office personnel.

Truck drivers are the lifeblood of your business. Drivers face unique risks during the performance of their job and may need coverage for gradual injuries or traumatic injuries, including:

• Falls from heights
• Being struck by or struck against objects
• Musculoskeletal disorder because they lift heavy cargo or objects
• Repetitive stress injuries, including trigger fingers, tendinitis, bursitis, or carpal tunnel
• Injuries from truck accidents, including broken bones, back injuries, internal bleeding, brain injuries, neck injuries, and more

Coverage for truck drivers under workers' compensation depends on their employment status. The driver must fall under the legal classification of an employee to receive workers' comp benefits.

If your drivers are independent contractors, you are likely not responsible for injuries they incur while working. Be careful not to attempt to sidestep the law regarding workers' compensation by misclassifying your truck drivers. The legal ramifications may be costly if you try to avoid state requirements for providing this coverage.

Not all insurance companies provide this type of coverage. Your insurance agent can advise you on your state's truck driver coverage requirements.

The policy coverage you need will depend on whether you do long-haul trucking or short-haul runs. Your insurance agent can advise you on whether there is an owner-operator mandate for workers' comp in your state.

What Commercial Truck Insurance Does Not Cover

Commercial truck insurance covers your fleet of trucks. It does not provide coverage for personal items of the owner or operator. Other standard exclusions include:

• Intentional damage, property damage, or bodily injury the driver intentionally inflicts on themselves or a third party
• Racing drivers who race against other vehicles are personally liable if they are in a collision
• Natural disasters, earthquakes, floods, etc., unless you have specific coverage

Check with your insurance carrier about specific exclusions on your policy.

Requirements to Purchase Insurance

When purchasing commercial truck insurance, you must provide specific information. This allows your agent to find the policy that best fits your needs. Items your agent may request include:

• A CDL if the driver is hauling more than 26,000 pounds
• MC and DOT authority
• The make, model, year, and VIN of all vehicles to receive coverage

Your insurance company wants to verify the drivers they insure have proper training. They also need to verify the exact trucks they are insuring and make sure they meet all legal requirements to be on the road.

Best Place to Buy Insurance for Truckers

If all the available insurance types have your head spinning, let the experts at Hummel Group sweat out the details of your policy needs. With two TRS on staff, we understand the regulations and state requirements when purchasing insurance for truckers.

Only move that fleet once you have sufficient insurance coverage. Call 800.860.1060 or request a quote online to ensure your trucking business and fleet have full protection.

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