Truckers Corner: What Kind of Insurance Does an Owner Operator Need?

Truckers Corner: What Kind of Insurance Does an Owner Operator Need?

Anyone who runs a trucking company as an owner-operator is well aware of the dangers that come with transporting goods. On the road, anything may happen. A single accident can cost a company tens of thousands of dollars in damages, which can be devastating but with the right commercial truck insurance, you won’t have to worry about unfortunate events.

Your company is your source of income. It’s vital for business owners to have protections in place to protect themselves against liability for losses caused by a variety of circumstances.

Insurance is designed to help you save money. While insurance is a major fixed expenditure for any owner-operator, you may choose insurance packages that fit within your budget and give you and your employees peace of mind.

Common Insurance Coverage for Owner Operators

Whether they’re on a long-term lease with a motor carrier or operating on their own, owner-operators require specialized truck insurance for products and services.

We recognize the distinction and can assist you in selecting the appropriate trucker insurance coverages to suit your needs and secure your livelihood. Below, you’ll find some of the common insurance coverages for owner-operators.

Motor Truck Cargo Insurance

Cargo being transported by truck is covered by motor truck cargo insurance. Because drivers are liable for the cargo while it is in their custody, they must be insured. Motor truck cargo insurance covers the extent of the insured’s legal liability for the products and protects against third-party claims.

A vehicle could be transporting tens or hundreds of thousands of dollars at any given time.

Having to pay big sums of money in damages can be disastrous for a company.

Owner-operators must be able to protect themselves and their employees against liability for damages, and motor truck cargo insurance is a critical tool for doing so.

Owner-operators and truckers are normally protected against the following risks under motor truck cargo coverage:

  • Acts of God or natural disasters
  • Water damage
  • Traffic accidents
  • Theft
  • Transportation hazards
  • Vandalism

Auto Liability Insurance

In the event of an at-fault accident, auto liability coverage pays for damage to another person’s property caused by the insured.

It can be used to pay for repairs or to completely replace the other vehicle. It can also be used to pay for medical bills. Liability coverage of $1 million is required by many shippers and owner-operators. The Federal Motor Carriers Safety Administration requires a minimum of $750,000.

Auto liability insurance is divided into two categories: primary and non-trucking. If you operate on your own authority, your auto liability is designated as primary. Non-trucking liability coverage is required for those who do not operate on their own authority.

Auto liability insurance protects your business as an owner-operator by paying costs that you are legally forced to pay if you or one of your drivers injures someone, damages their property, or both in an accident.

Motor Truck General Liability Insurance

General liability insurance for trucks covers property damage and injuries caused by business-related actions that aren’t directly tied to driving your truck. Owner-operators should acquire this insurance for their staff, and for-hire truckers are frequently compelled to have it.

The following are some instances of circumstances that are covered by motor truck general liability insurance:

  • Actions of your driver
  • Cargo delivery resulting in damage
  • Customers falling or slipping
  • Fire due to error
  • Slander

Physical Damage Coverage

Physical damage coverage covers the insured’s vehicle from loss or damage caused by an accident with another vehicle or object. It’s a catch-all word for a collection of coverages that safeguard your trucks, including:

Collision Insurance

Collision insurance is recommended to protect your trucks against damage caused by other vehicles or objects. It covers damages to your vehicle in a collision, even if it is totaled.

Comprehensive Insurance

Comprehensive coverage protects your car from damage that isn’t caused by a collision.

Theft and Fire Insurance

Theft and fire coverage, also known as specified perils insurance, protects your car from damage caused by fire and theft that occurs as a consequence of a non-collision incident.

Uninsured Motorist Insurance

Uninsured motorist coverage protects truckers in the event of an accident with someone who does not have liability insurance.  This form of insurance differs from state to state. It is often divided into three types of products:

Uninsured Motorist Bodily Injury Insurance

This covers medical expenditures incurred as a result of an accident or a hit-and-run by someone who does not have insurance.

Uninsured Motorist Insurance

This sort of insurance covers medical bills, lost wages, and pain and suffering caused by a driver who has insufficient insurance to cover all costs.

How to Choose Your Insurance Coverage

Consider the Cost

Owner-operators can take advantage of a variety of coverage options. It’s simple to compare prices and discover insurance coverage that fits your budget.

You can choose to unbundle your coverage, allowing you to pick and choose the specific coverage you think you’ll need based on your business, where you operate, and any other considerations that matter to you.

Insurance packages frequently include add-ons that you may or may not require, but will still have to pay for. You can consult with an insurance expert to find the most appropriate and cost-effective coverage for your needs.

Consider Claims Service

In today’s fast-paced environment, a 24-hour claims service is vital.  The sooner your insurance company gets involved, the more likely everything will go smoothly and be resolved swiftly.

It’s simple to compare offers from several suppliers and ensure that you’re getting a service that meets your needs when you need it.

Consider the Deductibles

Working with an insurance specialist to identify policies with clear deductibles is a good idea.

The deductible is the amount you must pay after a loss before your insurance kicks in. If you have a $1,000 deductible and a $5,000 loss, for example, you will pay $1,000 first and the insurance company will pay the remaining $4,000.

In the event of an accident, one company may have different deductibles for each vehicle and cargo, which means you will have to pay more. It’s critical to weigh your alternatives and ensure that you choose coverage with reasonable deductibles.

Frequently Asked Questions:

What is Motor Truck Cargo Insurance?
This covers cargo being transported by a truck, protecting the owner-operator against liability for damages, including those caused by natural disasters, traffic accidents, theft, and vandalism.

What is Auto Liability Insurance?
This pays for damages to another person’s property caused by the insured in an at-fault accident. It can cover vehicle repairs, replacements, and medical bills.

What does Motor Truck General Liability Insurance cover?
This insurance covers property damage and injuries caused by business-related actions not directly tied to driving the truck, including cargo delivery damages, customer accidents, fire, and slander.

What is Physical Damage Coverage?
Physical Damage Coverage insures the vehicle against loss or damage caused by an accident. It includes Collision, Comprehensive, and Theft and Fire insurance.

How should owner-operators choose their insurance coverage?
Consider the cost of different coverage options, claims service (24-hour service is optimal), and clear deductibles, consulting with an insurance expert for the most appropriate and cost-effective coverage.

Explore the concept of owner-operator authority and weigh the pros and cons while also learning about the necessary insurance coverage for owner operators. Gain a comprehensive understanding of the requirements and protect your business effectively by diving into our Truckers Corner guide today!

Partner with the Right Insurance Provider

If you find yourself asking, what kind of insurance does an owner operator need? We can help you choose the best policies and coverages to secure your business and protect your staff from liability for harm.

Whether you want to be an owner-operator or run your own small trucking company, you’ll have to meet a number of requirements before getting on the road, and insurance is one of them. Our team of dedicated experts is here to help.

Facing soaring prices as an owner-operator? Learn about ‘The Impact of Soaring Prices on Owner-Operators‘ while discovering the insurance coverage best suited to your needs. Get started now to ensure your operations are protected.

To learn more and request a free quote, you may contact us at 888-965-3002 at SoCal Truck Insurance today!