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Insurance for Truck Drivers – The Coverage You Need

First, truckers, tractors and trailers are insured as commercial equipment and do not automatically benefit from the coverage extensions of a personal auto insurance policy. Electronics, cargo equipment, cargo securement equipment, rent reimbursement and personal property are insured differently and are not automatically covered.

Commercial motor vehicle liability is quite simple. If a trucker has the authority of the ICC, a deposit of proof of financial responsibility will be submitted to the federal government. Deposits are what keep a trucker compliant with Federal Authority (ICC) requirements. Uninsured/Underinsured Motorist is also useful for a trucker who has been injured by an uninsured vehicle. Medical payments are useful when someone is injured in and on your truck.

Cargo insurance covers the trucker’s liability for the other goods he is transporting. There are 3 different forms or policies: Named Perils and Theft which has narrow coverage, Extended Form which adds some coverage to the basic form and All Perils which provides coverage for all causes unless they are excluded by the wording of the policy. Regardless of the form, there are certain covers that a trucker would need. Truckers must purchase freight coverage equal to the highest value of the goods they are transporting. Some policies include a co-insurance clause which may limit coverage limits if you are carrying a load of more value than the insured limit on your policy.

1) A reefer carrier would need Reefer Malfunction or Reefer Breakdown coverage to cover freezing or spoilage damage incurred if their reefer unit fails. Remember to check if the policy covers an error in the setting of the temperature control device. Most refrigeration policies only cover if the unit breaks down or malfunctions.

2) A flatbed carrier must have a moisture proof cover or rating in case its load is damaged by rain or snow. Most policies have a tarp endorsement that limits coverage to loads that are properly covered. Sometimes a tarp can become damaged or come loose through no fault of the trucker, resulting in damage to the load that may not be covered unless a moisture cover is added. Coverage for tarps, chains and bindings is also desired to replace stolen or damaged binding equipment not otherwise covered.

3) A dry van hauler would be advised to ensure that the movement of a load is covered. In this type of operation, larger and longer trailers are used and cargo securing equipment may fail. These cases are rare but do happen.

Every trucker should have earned freight coverage on their freight policy. This coverage reimburses the loss of revenue when it is unable to deliver its load due to a covered loss. Disposal and cleanup coverage for one loss must be at least $10,000.

Property damage coverage usually consists of repairing the tractor and trailer in the event of a covered loss. This coverage is provided on a declared value. The value set for the equipment is the responsibility of the truckers. The insurance company will pay a loss based on the same quality equipment. It means market value. The trucker must therefore ensure that his values ​​are correct. Remember that you will pay a deductible for each unit, unless your policy has a combined deductible endorsement. Also, towing is only for a covered loss and not for disability or breakdown. Many policies pay for losses and include towing and storage limits in the stated amount of the vehicle, so if you have a loss and a large towing or storage bill, the policy limit may not cover all of your loss . Towing coverage can and should be purchased in addition to physical damage. Make sure your towing policy covers disability and roadside service.

Electronic devices such as cell phones, televisions and radios are generally not covered unless you purchase additional coverage. Your personal property is also not covered unless specifically covered by the policy, but may be covered by your home insurance. Reimbursement of rent is also not automatically covered.

I’ve been insuring truckers for many years and know the emotional attachment to their trucks can be very strong, but insurance companies view them as a piece of equipment used to generate revenue. Therefore, the older they are and the more miles they have, the less money they are worth. Improvement issues also come into play. Tractors travel far more miles than automobiles and have a longer lifespan. The average tractor travels between 115,000 and 135,000 miles per year. Some insurance companies take this into account when replacing an engine or suspension part after an accident. If the expected life of the part is 500,000 miles and you have a wreck at 250,000 miles, some insurance companies will only pay half the replacement value of the part because half the life of expected life of the parts has been used. If an agent doesn’t know how their insurance company handles this ahead of time, there can be hell to pay.

General liability covers incidental liability exposure not covered by the commercial auto insurance policy. This is good coverage for auto haulers who may drive vehicles to a location after they have been unloaded from a trailer. Also a trucker who uses his own forklift to load and unload goods.

Workers’ compensation is required for injuries sustained by truckers or their employees. Worker’s Compensation is a low cost alternative with some coverage pros and cons. It’s always best to consult a truck insurance specialist to explain all of these coverages and get advice on the particular types of trucking risks.

For more information about me and truck issues, see the links below.

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