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    What Is Motor Carrier Insurance And Where Do You Get It?

    What is motor carrier insurance, and where do you get it? Under Federal Motor Carrier Safety Administration guidelines, business auto policies (BAP) cannot cover permanently leased trucks. BAP clients can only insure vehicles under their names.

    Fortunately, owner-operators who rely on for-hire trucking services can get the same benefits with a motor carrier policy. The arrangements vary on a case-by-case basis, but insurance companies always consider the best interests of the lessor and lessee.

    Defining Motor Carrier Insurance

    The Insurance Services Office, Inc. replaced outdated truckers' insurance plans with carrier policies in the early 1990s. Its coverage has similarities to a standard BAP. However, motor carrier insurance also insures clients who use leased trucks or offer for-hire trucking services, while BAP does not.

    What Motor Carrier Insurance Covers

    Motor carrier insurance coverage includes auto physical damage, trailer interchange, and auto liability insurance. You can broaden the damage coverage with endorsements and riders.

    Who Benefits From Motor Carrier Insurance?

    If BAP does not cover your trucking business, look into motor carrier policies. These plans protect motor carriers that do not qualify for BAPs (e.g. permanently leased owner-operators, for-hire trucking companies).

    However, applications are not limited to truck lessees and lessors. Any business that classifies as a "motor carrier" qualifies for carrier insurance coverage. Note that the term "motor carrier" applies to any commercial enterprise providing auto transportation or logistic services.

    Top Motor Carrier Insurance Options

    Choosing a suitable motor carrier coverage provider can feel intimidating considering the sheer number of options. To help with this, we've narrowed down the list to the top truck insurance companies in the country:

    Best Truck Insurance Agency: Progressive Comercial

    • Available in all 50 states
    • Broad policy options

    Progressive commercial ranks as our top preferred truck insurance company for accessibility, financial strength, and extensive coverage options. You can also boost their policies with several riders.

    Best for High-Risk Motor Carriers: The Hartford

    • Accepts high-risk motor carriers
    • Focus on trucker safety

    The Hartford has several safety programs geared toward improving driving safety and avoiding road accidents.

    Best for Small Truck Companies: Nationwide

    • Competitive premiums
    • Oldest auto insurance company in the country

    Nationwide offers the lowest truck insurance premiums on the market, and they have extensive discount programs to boot.

    Note how losing or damaging cargo while interchanging trailers can cost trucking service providers thousands of dollars. Check out our guide on mitigating damage through trailer interchange insurance policies.

    Frequently Asked Questions

    Does a motor carrier need cargo insurance?

    In order to transport household goods safely, it is necessary for drivers to have a cargo insurance policy at a minimum of $5000 per vehicle. The FMCSA does not require this coverage for carriers transporting other types of goods but we recommend that you obtain this type of protection anyway because accidents can happen at any time.

    What is motor carrier cargo insurance?

    Motor truck cargo insurance is a type of coverage that will protect the motor carrier from liability for any losses incurred by customers. This protection ensures that the customer's property will be safe and sound no matter what happens to it during transport.

    It helps protect companies against theft, vandalism, or natural disasters when they use motor vehicle transportation as their method of transporting goods from one place to another.

    How much does carrier insurance cost?

    For owner-operators who have a permanent lease with a motor carrier, the cost of semi-truck insurance can be $3K to $5k per year. For owners that are running their own authority and leasing out trucks on an as-needed basis, costs range from about 9K to 12k for each truck annually—or more! 

    Is cargo insurance required?

    In order to protect your goods from risks, it's important that you weigh the costs of insurance with potential losses and collateral damage. Without cargo insurance, you could find yourself facing catastrophic exposure.

    How much cargo insurance do I need?

    Federal law mandates $5,000 worth of cargo insurance per incident while some brokers require at least $100,000 worth if you're carrying expensive items such as jewelry or electronic equipment on your truck.

    Motor carrier insurance coverage needs vary from client to client, so never settle for a basic cargo policy or plan. No owner-operator would benefit from generic terms and conditions. Instead, look for a reliable truck insurance company that can give you the necessary damage coverage on vehicles you lease and the cargo you transport.

    At Assured Standard, we share that sufficient insurance coverage protects trucking service providers from several risks and accidents. Check out our resources for more information on getting other types of business insurance.

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