Welcome to the world of commercial trucking and the minefield on how to select the proper insurance coverage. Whether you’re a new owner-operator or planning to run a mid-size operation, you may have some concerns about insurance and what’s required, and what extra options you could likely benefit from. In fact, the right insurance can ultimately be your best friend when you’re getting your loads from point A to point B. Continue reading to learn more about commercial truck insurance.
The Federal Motor Carrier Safety Administration (FMCSA) and Department of Transportation (DOT) both require proof of liability insurance when you fill out an Operating Authority/MC Number application. Liability insurance is so-named because it provides protection against claims related to damages and/or injuries to the driver, the vehicle, or other affected parties. It’s a type of insurance that covers legal costs and payments that may have to be made to another party if you are considered liable, or legally responsible.
In the trucking industry, it’s not enough to have a simple liability insurance policy to be good to go insurance-wise. This is why it’s also necessary to explore your options with the various types of commercial truck insurance more specific to unique circumstances that apply to you.
Every possible type of commercial insurance isn’t required for all trucking professionals or owner-operators. Insurance needs will vary based on the nature of operations and other factors, such as the type of freight being transported. Coverage options with commercial truck insurance include:
Commercial truck insurance needs often change over time. This is why it can be helpful to work with an insurance agent who will let you know when it’s time to consider adjusting your coverage and to ensure you select the proper insurance coverage without covering what you don’t need to cover. As for what’s typically required to obtain coverage, you’ll need your commercial driver’s license (CDL) if you’ll be hauling 26,000 pounds or more. In order to apply for commercial truck insurance, you’ll also need MC and DOT numbers to demonstrate “active authority.” Also, be prepared to provide vehicle specifics – e.g., age of the truck, make, model, condition, mileage, etc.
This article follows on from our previous post about whether to buy or lease the right equipment. Our next step covers how to sign up for factoring, a service that makes a huge difference to the viability of your trucking company, helping to keep you liquid with a good cash flow.