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Primary Liability Insurance For Trucking Explained

Primary Liability Insurance For Trucking Explained

In this article, readers will learn about primary liability insurance, specifically its importance for trucking companies. The article will discuss key features of primary liability insurance, protections offered, regulatory requirements such as FMCSA regulations, and additional insurance options for trucking companies. 

Finally, the article will cover tips for choosing the right primary liability insurance based on assessing business needs and risks, understanding policy options and coverage limits, and working with reputable agents or brokers. Primary liability insurance is a type of coverage designed to protect third parties from damages caused by another party's negligence or wrongdoing. 

In the case of trucking companies, primary liability insurance covers damages caused by truck drivers and their vehicles while on the road. This type of insurance is crucial for trucking companies, as it provides financial protection in accidents or incidents that could lead to costly lawsuits.

Defining Primary Liability Insurance

Primary liability insurance is a type of insurance policy that covers the policyholder against claims made by third parties who suffer from bodily injury or property damage due to the policyholder's fault. In the context of trucking companies, primary liability insurance provides coverage for damages to other parties caused by truck drivers and their vehicles while carrying out their duties.

This insurance is considered "primary" because it pays claims first before any other coverage comes into play. Government regulations often require it and is part of the mandatory insurance coverage for trucking companies operating in the United States. The Federal Motor Carrier Safety Administration (FMCSA) sets the minimum required primary liability insurance limits, which currently stand at $750,000 for general freight carriers, $1 million for oil transport carriers, and $5 million for hazardous material carriers.

Key Features of Primary Liability Insurance

There are several key features of primary liability insurance that are important for trucking companies to understand. Some of these features include:

  1. Coverage for bodily injury and property damage: Primary liability insurance provides coverage for damages caused by the truck driver to other individuals or property. This can include medical expenses, lost wages, pain and suffering, and repair or replacement costs for damaged property.

  2. Legal defense coverage: In the case of a lawsuit filed against the trucking company, primary liability insurance can help cover the costs of legal defense, settlements, and judgments.

  3. Mandatory coverage: As mentioned earlier, primary liability insurance is a legal requirement for trucking companies as per the FMCSA regulations. This ensures that trucking companies have the financial ability to compensate third-party claimants in case of accidents or incidents.

  4. Limits of coverage: Primary liability insurance comes with a specific limit of coverage, as set by the FMCSA. This limit determines the maximum amount that the insurance company will pay in the event of a covered claim. However, trucking companies can choose to purchase additional coverage beyond these minimum requirements to further protect their assets.

  5. Deductibles: A deductible is the amount that the trucking company must pay out of pocket before the insurance company starts covering the claim. Deductibles can vary depending on the specific policy and the insurance company.

Importance of Primary Liability Insurance for Trucking Companies

Primary liability insurance is essential for trucking companies due to the following reasons:

  1. Legal requirement: As mentioned earlier, primary liability insurance is a mandatory coverage required by the FMCSA. Operating without this coverage can lead to severe penalties and fines for the trucking company.

  2. Financial protection: Accidents and incidents on the road can be expensive in terms of medical expenses, property damage, and legal costs. Primary liability insurance helps protect the trucking company from these financial burdens by covering costs up to the policy's limit.

  3. Maintaining a positive reputation: A trucking company with adequate liability insurance demonstrates its commitment to safety and responsibility. This can help the company maintain a positive reputation among its clients, partners, and the general public.

  4. Attracting and retaining drivers: Truck drivers are more likely to join and remain with a trucking company that has primary liability insurance. This is because they are assured that the company will be able to cover any damages or injuries they may cause while on the job.

  5. Peace of mind: Knowing that primary liability insurance will cover the financial fallout from any accidents or incidents involving their drivers or vehicles can provide trucking companies with peace of mind. This allows them to focus on their core operations and provide quality service to their clients.

Protection Offered by Primary Liability Insurance

Property Damage Coverage

Primary liability insurance covers damages caused to third-party property by a business's operations. For instance, if a contractor damages a client's wall, this coverage handles repair costs, protecting businesses from potential financial and reputational losses.

Bodily Injury Coverage

This essential component addresses injuries third parties may sustain due to a business's operations. An example is when a customer gets hurt in a store; this coverage helps with medical expenses and legal defense.

Environmental Cleanup Coverage

For businesses involved with hazardous substances, this coverage manages cleanup expenses from environmental contamination, ensuring they address regulatory and clean-up requirements.

Defense and Legal Expense Coverage

This aspect of the policy handles the costs of defending against lawsuits, encompassing attorney fees and court expenses. It offers businesses financial stability during legal disputes, potentially extending to lawsuit settlements.

In essence, primary liability insurance is a shield against unexpected liabilities, essential for business protection and success.

Regulatory Requirements for Trucking Companies

U.S. trucking companies must follow federal and state regulations, overseen by agencies like the FMCSA, for public, driver, and environmental safety. This article covers essential regulations, including minimum insurance, MC# acquisition, and UCR compliance.

FMCSA Regulations The Federal Motor Carrier Safety Administration (FMCSA), under the USDOT, governs the trucking industry, focusing on reducing accidents involving large vehicles. Key FMCSA regulations include:

  • Hours of Service (HOS): Rules restrict driving hours to prevent fatigue. For instance, drivers must rest for 10 hours after 11 hours of driving and adhere to weekly driving limits.

  • Controlled Substances and Alcohol: FMCSA mandates testing for drugs and alcohol, including pre-employment and post-accident checks. Driving under the influence is prohibited.

  • Commercial Driver's License (CDL): Commercial drivers need a CDL, secured by passing knowledge and skills tests.

  • Vehicle Maintenance: Carriers must regularly inspect and maintain their vehicles, recording every inspection and service.

Minimum Liability Insurance Coverage Required

The FMCSA requires trucking companies to carry liability insurance to cover the costs of property damage, bodily injury, and environmental restoration in the event of an accident. The minimum insurance requirement depends on the type of cargo being transported and the gross vehicle weight rating (GVWR) of the trucks in your fleet. For example, carriers transporting non-hazardous goods with a GVWR over 10,000 pounds must have at least $750,000 of liability insurance, while those with a GVWR less than 10,000 pounds only require $300,000.

Obtaining a Motor Carrier Identification Number (MC#)

A motor carrier identification number, or MC#, is assigned by the FMCSA to each trucking company. This number is used to track and identify carriers in the FMCSA's system and monitor their safety, compliance, and enforcement efforts. To obtain an MC#, carriers must apply for an operating authority, also known as a permit to engage in interstate commerce. The application process requires the completion of the Form OP-1, payment of a processing fee, and submission of proof of liability insurance.

Uniform Carrier Registration (UCR) Compliance

The Uniform Carrier Registration (UCR) program requires motor carriers to register annually and pay a fee based on the number of commercial motor vehicles they operate. The program was introduced to replace the Single State Registration System (SSRS) and streamline the registration process for interstate carriers.

UCR registration helps fund statewide motor carrier safety programs and enforcement efforts, ensuring that the industry remains compliant with federal regulations. To remain compliant, carriers must register and pay fees annually, providing necessary fleet and company details. Failure to comply with UCR registration requirements can lead to fines, penalties, and the suspension or revocation of a carrier's operating authority.

Additional Insurance Options for Trucking Companies

Trucking companies face a unique set of risks and liabilities due to the nature of their operation. In addition to the standard insurance coverage, there are a number of specialized insurance options that trucking companies can consider to better protect their assets and employees.

This article discusses five such additional insurance options: Physical Damage Insurance, Motor Truck Cargo Insurance, Bobtail Liability and Non-Trucking Liability Insurance, Workers' Compensation Insurance, and Umbrella and Excess Liability Coverage.

Physical Damage Insurance This insurance protects a trucking company's vehicles and equipment from damage due to accidents, theft, vandalism, or natural disasters. Two types are:

  • Collision Coverage: Covers repair or replacement costs after collisions.

  • Comprehensive Coverage: Addresses non-collision incidents like theft, fire, or natural calamities.

Motor Truck Cargo Insurance Protects the cargo during transport, covering liability for lost, stolen, or damaged goods. Especially vital for transporting valuable items, some clients might require this insurance in their contracts.

Bobtail & Non-Trucking Liability Insurance Covers trucks when not used for business, such as personal use or moving between job sites. Essential when primary liability doesn't apply, it shields against liability claims in non-business contexts.

Workers' Compensation Insurance A must-have for businesses with employees, it supports workers who suffer job-related injuries or illnesses. Beyond drivers, it can cover warehouse staff, mechanics, and other roles. It's a legal necessity and protects companies from legal repercussions.

Umbrella & Excess Liability Coverage Offers extra protection beyond primary liability limits, useful for high-risk trucking companies or those in accident-prone zones. It activates after primary insurance maxes out, safeguarding assets during large liability claims.

Choosing the Right Primary Liability Insurance

Selecting the right primary liability insurance is crucial for your business. Liability insurance can protect your enterprise from lawsuits and claims that arise from accidents, injuries, and other incidents. Let's discuss the essential steps to follow when choosing the best insurance coverage for your company.

Assessing Business Needs and Risks

To select suitable primary liability insurance, first evaluate your business's specific needs and potential threats. Factors include your business size, employee count, services/products offered, and location. Recognize potential risks like property damage or bodily injury claims. Locations prone to natural disasters or high-risk clients might necessitate additional coverage.

Understanding Policy Options and Coverage Limits

Familiarize yourself with different policies before deciding. Common ones include General Liability Insurance (GLI), Professional Liability Insurance (PLI), and Product Liability Insurance. GLI handles claims like bodily injury; PLI covers professionals against negligence; Product Liability caters to product-related claims. Coverage limits depend on your risk profile. Ensure you strike a balance between adequate protection and premium costs.

Working with a Reputable Insurance Agent or Broker

Seeking a knowledgeable insurance agent or broker is advantageous. They simplify policy complexities, identify coverage gaps, and tailor solutions to your needs and budget. Agents or brokers also assist during claims, ensuring fair outcomes.

Comparing Quotes from Multiple Insurers

Obtain and compare quotes from various insurers to secure competitive rates. Prioritize carriers with positive reviews, robust financial standings, and a history of fair claim resolutions. While cheaper options might be attractive, ensure your chosen insurer offers reliable support.

Re-evaluating Insurance Coverage Regularly

Your business dynamics change over time, and your insurance should reflect this. Regularly review your policy, especially when undergoing significant operational changes, to maintain adequate coverage. Periodic reviews might also reveal potential savings or new insurance opportunities.


1. What is primary liability insurance, and how is it essential for trucking companies?

Primary liability insurance is a mandatory policy that covers bodily injuries and property damages caused by a truck driver to other parties in an accident. It ensures financial protection for trucking companies, safeguarding them against potential losses and legal claims.

2. How does primary liability insurance differ from general liability insurance for trucking companies?

Primary liability insurance focuses on covering damages caused by truck drivers to others during an accident. In contrast, general liability insurance covers a broader range of incidents, such as property damage at the trucking company's premises, slander, and false advertising.

3. Are there any limitations to the protection offered by primary liability insurance for trucking companies?

Primary liability insurance has limitations as it only covers damages caused by truck drivers to third parties. It does not provide coverage for the trucking company's property, employee injuries, or other incidents that may occur while conducting business.

4. What factors determine the cost of primary liability insurance for trucking companies?

Factors affecting the cost of primary liability insurance for trucking companies include the number of trucks, driving records, geographic location and operating radius, types of cargo being transported, and the chosen coverage limits and deductibles.

5. Can a trucking company increase its coverage with primary liability insurance?

Yes, trucking companies can increase their coverage with primary liability insurance by raising coverage limits, although this usually results in higher premiums. Additionally, companies can opt for umbrella insurance to extend coverage beyond the standard policy limits.


Primary liability insurance is vital for trucking companies, safeguarding against potential financial losses from accidents or damages caused during transport operations. By covering claims of bodily injury and property damage to third parties, it ensures companies can navigate unforeseen challenges, maintaining both their financial stability and reputation in the industry.

Read more about how much trucking coverage you should get in 2023 from our blogs at Assured Standard.

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