Semi-truck insurance is a hard-hitting expense for any small fleet owner or an individual owner-operator. No matter how clean a company’s record is, insurance quotes continue to rise, as a commercial truck insurance company considers a range of factors when assessing the commercial truck insurance quote.
The good news is that it’s not all somber for an owner-operator.
Knowing what commercial insurance companies are looking for can help you obtain quality truck insurance coverage at a reasonable rate. In this article, we will take a look at a few of the most significant factors that determine your commercial truck insurance quote.
Continue reading below to learn more about the factors that determine your semi-truck insurance costs and various ways to reduce commercial truck insurance premiums.
How Much Does Insurance Cost?
Similar to an auto insurance policy, a commercial auto policy is a bundle policy that provides both liability coverage and physical injury coverage for commercial trucking companies. In most instances, the average cost for insurance is roughly $9,000 to $15,000 per vehicle. However, in recent years, some commercial trucking insurance premiums have reached upwards of $18,000.
Factors That Determine Your Semi Truck Insurance Costs
Costs of insurance can vary widely, which is why it’s wise to understand how each factor ultimately determines your semi-truck insurance costs. Let’s take a look at the main factors contributing to insurance premiums for a trucking company.
The Type of Trucks You Own
One of the main contributing factors to high insurance premiums is the type of semi-trucks your business owns. Newer trucks not only cost more to insure but can also be more expensive to repair, leading insurance providers to charge more to protect them.
Type of Cargo
The type of cargo your trucks carry also plays a major role in the insurance coverage that any commercial trucking business owner should look into. The more expensive the freight, the more expensive the insurance premium.
Additionally, if what your company is shipping is fragile or can be damaged while in transit if it’s not properly maintained, the insurance provider or insurance agent can add on additional premiums.
Drivers with a clean driving record are going to save your business thousands of dollars in premiums every year. When hiring drivers, some major red flags are going to be DUIs, excessive speeding, and ignoring traffic signs. If you have any drivers with these issues currently employed, they could be costing your business thousands of dollars.
While insurance is designed to protect you in the event of a lawsuit, it can also lead to increased premiums over time. Commercial companies with no claims history will have the best luck finding lower insurance premiums. Fair or not, this is the system.
Number of Routes Hauled
How many routes your company drives may also have an impact on your premium. Generally, the prices are more favorable for businesses traveling on the highway over long distances than for those living in metro areas. Although it might sound counter-intuitive, the explanation is that there is a lot of traffic in the metro area, which can often lead to a higher risk of an accident.
How to Lower Your Insurance Rates
Insurance companies consider a range of factors when assessing commercial trucking insurance premiums. Knowing what an insurance company is looking for can help you obtain quality commercial trucking insurance coverage at a reasonable rate.
Here are the top ways to reduce your commercial trucking insurance premium.
Hire Experienced Drivers
An Insurance company has a strong interest in years of driving experience when it comes to calculating rates for commercial trucking companies. This is because experienced motorists are more experienced with extreme weather conditions and other stressful working conditions while on the road.
As such, insurance providers consider the work to be comparatively less dangerous with experienced motorists. Ideally, you should look to hire motorists with at least two years of commercial trucking experience.
Hire Drivers with a Clean Driving Record
Just as important as it is to hire experienced drivers, it’s also essential to hire drivers with clean driving records. The past is the biggest predictor of the future and drivers with a history of repeated accidents and violations have a higher risk index than other drivers.
On the other hand, the opposite is also valid, and insurance companies are constantly taking note of such. When recruiting drivers for your business, consider hiring drivers with fewer violations and fewer accidents.
Verify Driver Employment History
Furthermore, a driver with a history of continuously changing trucking companies does not encourage much confidence with insurance firms. Truck drivers who have worked long periods of time with few employers and fewer work gaps ensure that they are familiar with complex equipment and trucking routes, instilling confidence in commercial trucking insurance companies.
Map out Your Trucking Routes
The roads on which your commercial trucks travel also have an effect on your truck insurance cost. As previously mentioned, factors such as inclement weather and population density have a considerable effect on the risk level of a specific route.
If possible, when mapping your commercial routes, avoid high-density metro areas and areas that are vulnerable to bad weather.
Pay On Time
Depending on the season, fluctuating demand, and several other variables, it’s understandable that some insurance payments will be tougher to make than others. However, nothing increases an insurance premium faster than late payments.
Paying your premiums on time is crucial to keeping your truck insurance cost and truck insurance rates low, so try to do so as frequently as possible.
DOT Safety Record
Your USDOT safety ranking is regularly used to assist in the calculation of the commercial insurance rate, and any DOT safety violation could place you at higher risk of increased premiums. Therefore, try to avoid as few safety violations as possible.
Lower Your Commercial Insurance Premium with SoCal Truck Insurance Today
When you’re searching for the best coverage for a commercial trucking business, you’ll always want to ensure that you provide maximum protection for your business and employees, while also getting the best deal possible.
Do you need help finding lower commercial insurance premiums?
At SoCal Truck Insurance every minute matters, we understand the day-to-day risks that every commercial truck business faces, which is why we have built a reliable and efficient insurance package tailored to meet your unique needs while also saving you time and money.
With more than 25 years of experience, SoCal Truck Insurance is committed to providing our customers with the most competitive and personalized commercial insurance quotes on the market.
Make sure that you have the best commercial insurance coverage for your needs and your budget by contacting SoCal Truck Insurance today to get your free commercial insurance quote.