Insurance

Commercial Tow Truck Insurance

Getting commercial tow truck insurance is mandatory in most states if your business operates tow trucks. It’s also a requirement in most lease and contract agreements to ensure you can handle the additional, unique risks of running various tow truck business operations.

Below, we discuss what commercial tow truck insurance is, and what types of coverage your insurance policy should include if you want to run a towing business in several states.

We also highlight a few optional coverage options that different towing companies ought to consider helping you fully secure your specific towing business from various financial losses.

What Is Tow Truck Insurance?

Tow truck insurance is a commercial auto insurance coverage for towing companies. It considers how complex and expensive accidents involving tow trucks are and offers adequate protection from the financial implications of these incidents.

If a tow truck accident occurs and you are the at-fault party, you’ll be responsible for damages to your car, the towed vehicle, and other vehicles involved. This is besides covering the medical bills for all injured victims. In this scenario, the right tow truck insurance solutions will help you to:

Cover the repair and replacement cost of your truck, customer vehicles, and third-party vehicles involved in the accident (up to your policy limit)
Compensate injured victims for all the physical, emotional, and psychological losses incurred because of the incident (up to your policy limit)
Cover all legal fees throughout any lawsuits you may face after the accident (separate from your policy amount)

What Does Tow Truck Insurance Not Cover?

It’s critical to note that tow truck insurance does not cover the following:

Intentional damage – this includes any injuries or damage you inflict on other people or their property knowingly
Certain types of cargo, including explosives, pharmaceutical drugs, and alcohol
Damages beyond your policy limits – your towing truck insurance company will only cover damages and expenses to a maximum of your policy limit per incident.

Tow Truck Insurance Requirements

Following the U.S. federal law, all tow truck operators must purchase auto liability insurance to conduct their business. This is the minimum tow truck insurance requirement in all states. Other requirements vary from state to state.

Some regions require you to get the following:

Medical payments coverage
General liability coverage
Physical damage insurance and
Worker’s compensation insurance if you have several employees.

Also, you must meet all the federal and state insurance filing requirements to comply with all insurance laws. Learn more about this on FMCSA’s detailed summary of insurance filing requirements.

Types of Commercial Tow Truck Insurance

There are several types of commercial towing truck insurance coverage. Here are a few essential coverage options you should include in your tow truck insurance policy to run your towing venture smoothly:

Liability Coverage

Liability coverage includes bodily injury and property damage liability.

Bodily injury liability insurance compensates third-party victims for injuries caused by a tow truck accident involving you or your employees. Property damage liability coverage pays for damage to their property.

Liability insurance is the fundamental coverage required for all tow truck operators nationwide. States often establish minimum coverage amounts for operating in their region; for instance, Texas mandates approximately $500,000 in liability coverage per tow truck per accident.

Physical Damage Coverage

Physical damage coverage also comes in two forms – collision and comprehensive coverage.

Collision coverage pays for the repair or replacement costs of your company’s tow truck if it hits another car or object, such as a pole. It also covers you if your tow truck rolls or overturns.

In contrast, comprehensive coverage protects you from several non-collision incidents, like vandalism, theft, fire, harsh weather, etc.

Medical Payments Coverage

Medical payments insurance pays the medical bills of your covered vehicle’s occupants if they sustain injuries in an incident involving your tow truck. Occupants here could be you or your tow truck drivers and other passengers.

Uninsured/ Under-insured Motorists Coverage

This coverage option covers medical expenses if you or your tow truck drivers get injured in an accident caused by a driver with insufficient liability insurance or one without insurance.

Workers’ Compensation Coverage

Workers’ compensation insurance is critical for tow truck companies with several employees. It compensates employees for any work-related injuries. It also covers legal fees for all employee injury-related lawsuits.

Additional Coverage for Towing and Storage Businesses

The coverage options above may not be adequate for various tow truck business operations. Here are some optional but vital additional coverage for different towing and storage businesses you should consider for maximum financial stability in your specific towing business:

On-Hook Towing Insurance

On-hook towing insurance protects you when towing customers’ vehicles. It covers the repair or replacement cost for a client’s vehicle if it gets damaged in a crash, theft, vandalism, or fire while you’re hauling it. This coverage is helpful if you’re a roadside assistance provider who often tows third-party vehicles.

You may also want to purchase cargo coverage to cover the items inside the vehicles you tow.

Garage Keeper’s Legal Liability Insurance

Garage keepers legal liability insurance is vital for towing service companies that store clients’ vehicles for repair, parking, or other services. It safeguards clients’ vehicles while in your care at a covered location, covering physical damage caused by theft, vandalism, collision, and more.

Consider commercial property insurance to protect your business premises, equipment, and tools.

Tow General Liability Insurance

General liability insurance protects you if you’re legally responsible for property damage and personal injury to a customer or third party. The damage or injury may be related to your business, but not your covered vehicles.

Final Thoughts

Insurance requirements differ for tow truck companies based on their specific services. For instance, a roadside assistance provider may need different insurance policies compared to a towing company specializing in repossession or operating a repair facility. This is because each company encounters distinct risks alongside the common risks shared by all trucking companies.

To choose the right coverage, evaluate your business goals and budget, then shop around to identify the best tow truck insurance provider to match your business needs. Ensure you get multiple quotes from various providers and compare them before settling for one.

Here’s an in-depth guide to the best commercial truck insurance brokers. Check it out to understand how to choose an insurance provider. You can also reach out to us for assistance, especially with add-on coverage.

Physical Damage Insurance for Semi Trucks

Several risks can put your semi-truck out of commission unexpectedly. It could get damaged in a crash, fire, hailstorm, or other natural disasters. Worse still, your semi-truck can get vandalized or stolen.

What do you do if any of these unfortunate events occur and you don’t have cash set aside to repair or replace your truck? How do you get back to business fast? This is where semi-truck physical damage insurance comes into play.

We’ve prepared this quick guide to help you understand everything you should know about physical damage trucking insurance – what is it, and what exactly does it cover? Do you need a physical damage policy?

What Is Physical Damage Insurance?

Physical damage insurance encompasses various types of trucking insurance that safeguard commercial vehicles from a range of risks while on the road. These include:

Collision coverage: Covers repair or replacement costs if your commercial truck is damaged in a collision or overturns.
Comprehensive coverage: Covers repairs or replacement for non-collision incidents beyond your control, such as theft, vandalism, fire, glass and windshield damage, accidents involving animals, bad weather, or other acts of nature.
Fire and theft insurance with CAC (Combined Additional Coverage): A specialized form of comprehensive insurance for heavy vehicles, covering specific non-collision incidents like fire, theft, vandalism, floods, lightning, earthquakes, and other natural disasters, excluding windshield claims.

Most trucking companies rely on physical damage coverage to prevent business interruption and mitigate significant financial losses from unexpected events.

What Physical Damage Insurance Covers

Insurance policies differ per insurer. But nearly all physical damage insurance policies offer the following coverage options:

Roadside Assistance and Towing

Commercial vehicles break down often, and towing your vehicle after an unexpected event can be expensive. With roadside assistance and towing physical damage coverage, your insurance provider will:

Cover the expenses for onsite repair work if a covered loss occurs
Reimburse the cost of towing your damaged vehicle after an accident

Some of the best physical damage coverage policies provide an extended towing option. They’ll let you get your semi-truck towed to your garage or one that’s close to your trucking company’s main headquarters (instead of the nearest garage) at no additional charge.

Downtime Coverage

Extended truck downtime halts your business operations, resulting in daily financial losses. Downtime coverage provides compensation, typically a set amount per agreed time, until your vehicle is back on the road.

Emergency Expenses

This coverage is beneficial for over-the-road (OTR) truck drivers involved in distant accidents. It covers expenses for their safety post-incident and facilitates their safe return home, including additional lodging, food, and transportation costs.

Loan Gap Coverage

If your truck is declared a total loss because of a serious accident or theft, and you still owe money on the commercial vehicle loan, loan gap coverage steps in. This coverage fills the gap between the actual cash value of your truck at the time of the covered loss and the outstanding loan balance.

For example, if you owe $25,000 on your loan but the current actual cash value of your vehicle is $20,000, your insurer without loan gap coverage would only pay you $20,000 (minus deductible). With loan gap coverage, you’d receive the actual cash value of your truck ($20,000) plus the $5,000 loan gap amount, totaling $25,000 (minus deductible) to help settle the outstanding loan balance.

For more information on gap insurance, check out this detailed guide.

Truck Rental Costs

If a truck driver gets into an accident mid-trip, you must find a way to deliver the cargo to its final destination. Truck rental costs help you cover the costs of renting another truck to complete the trip and fulfill your obligation to a client.

Equipment Floater Insurance

Equipment floater insurance protects valuable tools or equipment not permanently attached to a truck, but necessary for specific trucking operations.

Rental Reimbursement

Rental reimbursement covers renting another truck to continue your trucking operations while your covered vehicle is under repair after a covered loss. Most insurance companies provide rental reimbursement for an agreed period – often up to 120 days after a covered loss.

What Physical Damage Won’t Cover – Exceptions and Restrictions

Physical damage insurance won’t cover the following risks:

Damage to cargo and personal effects, including a driver’s personal items, electronic equipment, chains, binders, and non-permanently attached equipment.
General wear and tear on various vehicle parts
Medical expenses
Lawsuit fees
Damage to other vehicles

Physical damage insurance doesn’t cover non-owned trailer damages, including those used in a trailer interchange agreement.

Who Needs Trucking Physical Damage Insurance?

You will benefit from and should consider purchasing physical damage coverage if you belong to any of the following three categories:

Owner-operators: Owner-operators are responsible for insuring all commercial vehicles against physical damages, even if they operate under a motor carrier’s lease. Usually, leased owner-operators only receive primary liability insurance through their motor carrier.

For-hire motor carriers: Unless exclusively working with owner-operators, trucking companies with a fleet of commercial vehicles need physical damage coverage.

Private carriers: Individuals transporting their own cargo require physical damage insurance to protect their vehicle.

Physical Damage Coverage Deductibles

When buying physical damage truck insurance, you’ll need to choose a deductible, which is the amount you’ll pay out-of-pocket when making an insurance claim. You have different deductible options to consider based on your insurance requirements:

Single deductible for accounts with multiple coverage options.
Customized aggregate deductible for fleets.

Select your deductible thoughtfully as it impacts your insurance costs. Opting for a higher deductible usually reduces monthly payments, but ensure it’s an amount you can comfortably afford to pay when necessary.

Final Thoughts

While the law doesn’t mandate purchasing physical damage insurance, it’s a crucial coverage policy to ensure the smooth operation of your trucking business.

To find the best physical damage insurance provider, obtain quotes from multiple insurers and compare them. Look for specific features and terms, such as discounts and the availability of a single deductible endorsement at no extra cost.

Assess how well their terms align with your business’s current and future objectives. Check out our detailed guide on commercial truck insurance for further insights into selecting an insurance provider.

Additionally, consider our add-on coverage options for extra protection. If you ever require vehicle financing to recover from an unforeseen setback, don’t hesitate to contact Mission Financial Services. We’re always here to assist you.

What Is Commercial Hazmat Truck Insurance?

Hauling hazardous materials is one of the most profitable commercial trucking ventures. It’s also the riskiest as it threatens public safety.

To minimize risks and promote public safety, the federal government imposes several restrictions on hazardous materials hauling. You cannot, for instance, conduct your hazmat trucking operations without purchasing a hazmat truck insurance policy with specific coverages.

Below, we discuss all you need to know about hazmat trucking insurance: What is it, and what coverage options do you need for your hazmat commercial trucking business to succeed?

What is Hazmat Truck Insurance?

Hazmat truck insurance protects companies transporting hazardous materials from both general trucking risks and specific hazards associated with handling dangerous substances.

These policies tend to be pricier due to safety concerns, but they offer similar benefits to regular commercial trucking insurance. This coverage ensures financial protection in case of accidents, covering losses and legal fees associated with settlements.

Who Needs Hazmat Truck Insurance?

State and federal laws require all businesses that haul hazardous materials to purchase hazmat trucking insurance.

Hazardous material includes anything that threatens human safety, is explosive, flammable, or poisonous. Several materials fit these criteria of harmful substances and are, thus, labeled hazardous or extra hazardous, depending on how dangerous they are.

This includes business owners who operate hazardous waste transporters. These include entities or individuals who transport waste from their source to a different destination, say a recycling, treatment, storage, or disposal facility.

What Cargo is Classified as Hazardous Materials?

According to the Federal Motor Carrier Safety Administration (FMCSA), all the examples of hazardous materials we’ve mentioned fall under nine classes of hazardous cargo:

Class 1 – Explosives

Class 2 – Gasses

Class 3 – Flammable liquid

Class 4 – Flammable solid

Class 5 – Oxidizing substances, e.g., organic peroxides

Class 6 – Poisonous (toxic) or infectious substances

Class 7 – Radioactive materials

Class 8 – Corrosives

Class 9 – Miscellaneous dangerous goods, like marine pollutants

Different classes of hazardous materials require varying amounts of liability coverage. Some, like the poisonous and radioactive classes, are difficult to insure unless you work with a knowledgeable and experienced hazmat truck insurance company.

What Coverage is Offered by Hazmat Insurance Carriers?

Hazmat truck insurance companies offer several insurance coverages.

Collision and Comprehensive

Collision and comprehensive hazmat trucking insurance protects your trucks and trailers from damages resulting from theft, vandalism, overturn, upset, fire, bad weather, and accidents with animals.

Pollution Liability

Pollution liability coverage covers cleanup expenses if pollutants spill in transit or during loading and unloading. This coverage also pays for damages that may occur due to the spill.

Hazmat General Liability

Liability insurance covers incidents specific to the trucker’s actions and other non-trucking-related claims. These may include wrongful delivery of liquids. It’s worth noting that this type of hazmat truck insurance is usually a requirement for most hazardous materials trucking contracts.

Liability Insurance

Liability insurance is mandatory (required by law) for all hazmat haulers. It pays for third-party bodily injury and property damages when your covered auto causes an accident.

On average, FMCSA requires you to purchase a $1,000,000 minimum liability coverage, but this depends on the hazardous materials hauled. Some hazardous cargo require a minimum of $5,000,000 liability insurance to transport.

Excess Liability

Excess liability coverage provides additional protection against settlement claims that may exceed your insurance liability limits, up to $50,000,000.

Loading and Unloading

Loading and unloading protects hazardous cargo when being loaded or unloaded.

Medical Payments and PIP

Medical payments and personal injury protection (PIP) covers medical payments for any injuries your driver and other passengers in your car may incur in an accident, regardless of fault.

GAP Insurance

Hazmat truck and trailer values can depreciate faster than their financed value. Add-on GAP coverage protects you if your truck is stolen or totaled, covering the difference between compensation and your loan or lease balance.

Downtime Coverage

Downtime coverage helps you manage your truck payments and other essential bills if a covered loss pushes you out of business for an extended period.

Rental Reimbursement

Hazmat truck rental reimbursement coverage allows you to rent another truck and continue working if an accident puts your vehicle out of operation. It covers a chunk of the rental cost to help you remain profitable while waiting for your truck to get repaired.

Requirements for Hazmat Commercial Truck Insurance

The minimum insurance filing requirements for hazmat trucks depend on the types of hazardous materials hauled.

Trucks transporting oil and hazardous waste require a minimum of $1,000,000 liability coverage. Trucks transporting gases, explosives, radioactive materials, or anything poisonous if inhaled require significantly higher coverage limits of $5,000,000 minimum.

Haulers of hazardous cargo must comply with several safety-sensitive requirements outlined by FMCSA, including:

Maintaining proper placards
Keeping their commercial driver’s license (CDL) endorsements up-to-date
Purchasing required safety permits and following all applicable regulations for hazardous trucking.

Considerations When Choosing a Hazmat Trucking Insurance Carrier

When looking for a hazmat trucking insurance carrier, settle for a leading provider with both expertise in commercial trucking insurance and knowledge about the unique risks of hazmat trucking.

To identify the best hazmat truck insurance company, shop around for one that offers:

Competitive rates and discounts
Help comply with all safety regulations
24/7 access to your insurance certificate
Pre-employment Screening Reports (PSPs) for potential truck drivers to help you make informed hiring decisions
Transparency when handling policy changes and renewals

Final Thoughts

FMCSA subjects hazmat haulers to stricter hazmat regulations and higher liability limits than non-hazardous materials haulers for your safety and the safety of all road users.

To follow all laws, ensure you get the right hazmat truck coverages and train your employees to handle hazardous freight accordingly.

Take your time to find an experienced hazmat trucking insurance provider who’ll help you navigate the intricacies of hazmat trucking insurance like a business partner. So you won’t have to worry about hazmat safety violations and can conduct your business operations peacefully.

For help financing truck repairs or replacement after an accident, reach out to us. We’ve been offering commercial vehicle loans for over 18 years and can tailor our loan packages to match your current needs.

Commercial Box Truck Insurance Explained

Box trucks are a pillar of the transportation industry. They pick up where rail and truck-trailer transport leave off, delivering essential materials and goods to homes and other locations across cities or towns.

If you rely on box trucks for business operations, you require commercial box truck insurance to protect your company assets from frequent short-haul box trucking risks. This type of truck insurance coverage will secure your business in a way a standard commercial auto insurance policy won’t.

Here’s everything you need to know about commercial box truck insurance to protect your business and thrive long term.

What is Box Truck Insurance?

Box truck insurance is a commercial auto insurance for companies that conduct business operations using box or straight trucks, i.e. trucks with enclosed cuboid-shaped cargo areas.

It covers several risks that come with the constant movement of your trucks to and from warehouses, depots, and other distribution centers.

With the right box truck insurance coverages, you can protect your trucks, their drivers, and the cargo you haul on and off-road. This safeguards your entire business from financial losses due to lawsuits if any of your box truck drivers cause an accident since your insurance provider will help pay for:

All bodily injury and property damage claims (up to your policy limit)
Losses from unexpected incidents, like vandalism, theft, and natural disasters
Your legal fees throughout the settlement claim cases (separate from your policy amount)

Types of Box Trucks

Box trucks come in different shapes and sizes based on their uses. Some common types include the following:

Parcel Vans

Because they are used for delivery services, parcel vans have multiple compartments for transporting different packages safely.

Dry Vans

The most popular type of box truck, dry vans transport a range of cargo that doesn’t require specialized handling or temperature control. They have features for loading and unloading cargo and, thus, are essential assets in the manufacturing and retail industry.

Refrigerated Trucks

Unlike dry vans, refrigerated trucks have cooling systems for transporting perishable goods. The refrigerated section maintains a controlled temperature to prevent spoilage. These trucks benefit the food, pharmaceuticals, and floral distribution industries.

Straight Trucks

Box truck insurance covers straight trucks, even though they don’t fall under the box trucks category per se. These trucks have one compartment for the driver and cargo. Most commercial truck business owners use them for delivery and moving services.

Businesses That Need Box Truck Insurance

All businesses that use box trucks for business need box truck insurance to safeguard their assets, business operations, and overall financial well-being. A few examples of these businesses include:

Retail shipping companies
Delivery services
Moving companies
Catering services
Construction and contracting companies
Landscaping and maintenance companies
Manufacturing companies
Wholesalers
Waste collection and disposal
Courier services

Box Truck Insurance Coverages

A box truck insurance policy can have various coverage options, including:

Cargo Insurance

Cargo insurance covers the value of the goods you haul if anything happens to them during transportation. You’ll never have to worry if the cargo you’re hauling gets damaged or stolen in transit.

Comprehensive Coverage

Comprehensive coverage pays for your trucks’ repairs or replacement if they get damaged in non-collision incidents. These incidents may be natural disasters, fires, theft, vandalism, etc.

Collision Coverage

Collision insurance covers repair or replacement costs if your box trucks collide with other vehicles or hit objects like poles or walls.

Property Damage Liability

If you or your truck drivers cause an auto accident and damage other people’s property, your property damage liability coverage kicks in to pay for the damages.

This type of liability insurance covers repairs for the vehicles involved in the accident and any damaged buildings nearby. If the vehicles get damaged beyond repair, your insurer covers replacement costs.

Bodily Injury Liability

Bodily injury liability insurance pays the medical bills of injured victims in an accident where you or your truck drivers are at fault. Apart from compensation for victims’ bodily injuries, this insurance covers funeral expenses if the accident leads to fatalities.

Bodily injury and property damage liability coverage is mandatory for all truck business owners. Several state laws dictate how much your minimum coverage limits for both types of coverage should be.

Also, there are more coverage options for box trucks you ought to consider, especially if you are an independent trucker with your own trucking business. Some of these include:

Unattended truck coverage. Adding unattended truck coverage protects your box truck when you’re resting during a long-haul trip.
Trailer interchange – trailer insurance protects exchanged trailers after a trailer interchange service.
Accessories coverage – covers truckers who carry expensive extra accessories or equipment that can get damaged in an accident.

Choose The Right Box Truck Insurance For Your Business

Different insurance companies offer various box truck commercial insurance policies at different rates. Follow these steps to find the right insurance for your business:

Evaluate your business needs by considering current and future goals and your budget.
Research top insurance firms that align with your needs, focusing on the top 3 to 5 options. Our guide on the best insurance choices for commercial truckers might help you here.
Request quotes from these top firms and compare them based on insurance cost, customer service, and claims handling.

Assess each company’s box truck insurance cost, customer service, and how it handles claims when comparing quotes from multiple insurance providers. Learn more about this in our article on commercial truck insurance for small businesses.

Final Thoughts

Finding the right box truck insurance policy requires effort, but it’s a long-term investment worth your time.

You can seek the help of qualified commercial truck insurance agents or brokers to make the process easier. The best insurance brokers will help you find the most fitting policies for your business fast and assist in handling claims when necessary.

If you ever need financing to repair or replace your truck after an accident, reach out to us. At Mission Financial Services we offer several commercial vehicle loans and can customize our loan packages to your situation to help you get back to business sooner.

Guide To Commercial Vehicle Fleet Insurance

Purchasing commercial fleet insurance is the most efficient and convenient way to protect your business vehicles if your company heavily depends on commercial vehicles to operate.

Having multiple cars or heavy machinery on the road or job site increases your exposure to accidents and unpredictable events. Fleet insurance mitigates all the risks your business vehicles are exposed to in a way a standard commercial auto insurance policy doesn’t.

This guide contains everything you need to know about commercial fleet insurance policies to help you get the right coverage for your business vehicles. You’ll also find a few practical tips to reduce fleet insurance costs and save money, regardless of the number of fleet vehicles you have.

What is Fleet insurance?

A fleet insurance policy is a specialized insurance coverage for companies that require multiple vehicles for business purposes.

It covers your legal expenses and offers financial protection against bodily injury plus property damage after unforeseen incidents, the same way individually rated commercial vehicle insurance does. The only difference is the scope of coverage provided.

Instead of covering each business vehicle separately, commercial fleet auto insurance allows you to put all vehicles under one comprehensive policy. Doing this has several benefits administratively and cost-wise.

Why Do You Need Insurance for a Fleet?

As a commercial fleet business owner, you need fleet insurance because of its many advantages, such as:

Adequate Financial Protection

A Commercial fleet auto insurance policy considers the heightened risks of managing a fleet and your unique business needs to ensure your company is well-protected. Without it, you might experience financial strain, preventing your business growth.

Easy To Manage

Purchasing one aggregate commercial auto insurance policy for all your company vehicles means less paperwork for your administrative staff. It’s easier to keep track of one commercial policy than to follow up on several separate policies for each vehicle. Managing claims and adjustments for many vehicles is also more straightforward with fleet insurance.

Cost-effective

Fleet insurance premiums are usually lower than the sum of the insurance premiums of several individual commercial policies. Plus, you only need to make one monthly or annual payment instead of working with multiple payment plans for each vehicle, which may include additional transaction fees.

Flexibility

Commercial fleet auto insurance covers more than one type of vehicle in a fleet. You can customize the insurance plan to cover any combination of commercial vehicles based on your business needs. For example, your fleet vehicle insurance policy may include two cars, four mini-vans, and ten semi-trucks.

Also, fleet auto insurance lets you:

Add or remove vehicles as your business scales.
Enjoy driver flexibility by insuring all your vehicles in a way that allows all employees to drive them – this is different from other auto insurance policies, like personal auto insurance, where you have to specify the drivers covered under the policy.

How Many Vehicles Are Needed For Fleet Insurance?

Most insurance companies place their fleet insurance coverage under two categories – small and large fleet commercial policies.

Trucking companies can decide what constitutes a small or large fleet for them. However, some insurance providers require a minimum of two commercial vehicles to qualify for small fleet insurance. In comparison, others require at least five motor vehicles.

As for large fleet insurance, you need at least 20 commercial vehicles to apply to some insurance companies and 30 cars to others.

Types of Fleet Insurance Coverage

Some essential commercial auto coverages offered by a fleet auto insurance policy include the following:

Comprehensive coverage – comprehensive coverage protects your vehicles from non-collision damages. These include damages due to theft, vandalism, bad weather, animal strikes, and other incidents not caused by vehicles crashing into each other.
Collision coverage – collision coverage pays for costly vehicle repairs or replacement after collisions.
Uninsured Motorist – uninsured motorist coverage covers physical damage and medical expenses if your covered fleet vehicles get involved in accidents where the at-fault driver lacks insurance.
Combined Single Limit Liability Coverage (CSL) – CSL provides two separate commercial vehicle insurance policies, i.e., bodily injury and property damage liability coverage, as one. Bodily injury liability coverage pays the medical bills of injured victims if your insured vehicle causes an accident, and property damage coverage offers compensation for any property damaged by the accident.

Factors That Influence The Cost of Fleet Insurance

Fleet insurance costs vary per insurer, but most of them consider the following factors to determine how much you’ll pay for coverage:

Policy Options – a company that purchases various coverage options will pay higher insurance premiums annually than another that gets one comprehensive bodily injury and physical damage coverage.
Industry risk – the business operations of some industries are riskier than others. Companies whose vehicles are constantly on the road are more likely to get involved in accidents and often pay more to insure their cars.
Type Of Vehicles – the type of vehicles in your fleet also affects your insurance cost. Small cars are generally less costly to insure than large trucks.
Age Of Vehicles – your fleet vehicles’ age also determines the total cost of your fleet insurance policy. Newer vehicles might cost you more to insure.
Condition Of Vehicles – insuring well-maintained vehicles is cheaper because they are safer to operate.
Value Of Vehicles – the value of your fleet vehicles also matters when insurers calculate your insurance rates. The higher the value, the higher your insurance premiums will be.
Intended Use/cargo type – commercial auto insurance for a fleet that hauls hazardous materials is more expensive than a similar auto policy for transporting non-hazardous goods.
Miles Driven – if your vehicles cover more miles, your insurance premiums will be higher because the chances of getting into accidents increase the longer a vehicle is on the road.
Driver Experience – fleet insurance costs less if your fleet drivers have more experience and their driving records are clean.
Medical Costs – medical payments also play a role in determining your insurance rates. If they increase, the amount required to pay for the treatment of those injured in an accident also increases. Some insurance companies pass these increased costs on to you by charging higher premiums.

Information You Need For Fleet and Commercial Truck Insurance

Insurance companies require several documents before underwriting a commercial fleet auto insurance policy. Here’s a list of the documentation you’ll need to apply for fleet insurance successfully:

The insurance policy declarations page of your current commercial vehicle policy is essential. This document should contain all the information about your auto insurance policy – from what the policy covers to the amount of coverage, deductibles, and policy limits.
The Vehicle Identification Number (VIN) of each commercial vehicle on your fleet and a summary of their safety features, if any.
Your commercial driver’s license numbers (CDLs) and their driving histories, including any infractions, citations, or violations
Your latest audited financial statements
Copies of your permanent lease and individual trip lease contracts
Copies of your International Fuel Tax Administration (IFTA) reports showing your vehicle mileage by state and the total mileage covered within a specified period.
Copies of your fleet maintenance programs and federal compliance reviews of your safety ratings

Ways to Reduce Fleet Insurance Costs

Here are a few things you can do to lower insurance costs and increase your profit margins:

Match Your Insurance Limits To The Degree Of Risk At Hand

Tailor your commercial auto insurance coverage to your specific business needs. You’ll only pay for the essential coverage you need, thus avoiding wasting money on excess coverage.

Attain Excellent SAFER Scores

Safety and Fitness Electronic Records (SAFER) is FMCSA’s system containing safety-related profiles and data of motor carriers. Low surfer scores mean you have several traffic violations. With a low score, you’ll pay more to insure your vehicles adequately.

On the other hand, excellent SAFER scores mean your driving record is clean, and this helps you qualify for high-quality fleet insurance at cheaper rates.

Increase Your Deductible.

Deductibles are a way of sharing FMCSA’s financial responsibility requirements for commercial vehicles with your insurance provider. It’s the amount you’ll pay out-of-pocket to cover losses after an accident before your insurer chips in. A higher deductible equals a more affordable commercial vehicle insurance policy.

Pay Your Insurance Premiums In A Lump Sum.

Paying your premiums in lump sum helps you qualify for significant discounts in most insurance firms.
Insure All Or Several Vehicles With One Insurance Firm

Most insurers also offer discounts and other incentives if the size of your fleet is large. Ask how many commercial vehicles you need to qualify for available discounts.

Improve Your Drivers’ Operating Behaviors.

Conduct ongoing training for your fleet drivers to help them maintain safe driving habits. Consistent, safe driving habits reduce your premiums.

Install Safety-Related, Risk Management Technologies

Installing safety-related technologies, like dashboard cameras, Electronic Logging Devices (ELDs), and GPS trackers, improve your vehicle’s safety while on the road and when not in use. Ensuring your vehicles are always safe increases your chances of purchasing comprehensive fleet insurance at low costs.

Final Thoughts

Fleet insurance is essential for companies with more than one business vehicle. It’s the key to securing the future of your business operation.

To purchase the right fleet insurance policy for your specific company, consider your fleet size, claims history, and the role of your vehicles in daily business use. Then shop around to identify the top 3 to 5 insurers who align with your needs and compare their insurance quotes before picking the most fitting commercial fleet insurer for your specific situation.

Check out our detailed guide about commercial truck insurance for small businesses to understand what to look for when evaluating your commercial auto coverage options. You can also visit our blog to stay updated on the latest news within the trucking industry.

Hotshot Commercial Truck Insurance

Many different types of trucking businesses exist – with hotshot trucking being a popular area.

As this is a unique type of trucking, it comes with its specialized insurance requirements. This is why hotshot trucking operators need the right insurance policy that matches their business needs and operations.

If you only offer hotshot trucking services, taking out a regular commercial trucking insurance policy could waste money.

To help you out, here are some of the critical things you need to know about hotshot commercial truck insurance.

What is Hot Shot Trucking?

Hot shot trucking is a trucking and delivery service that involves transporting relatively small, time-sensitive loads. With hot shot trucking, you use smaller trucks, typically one-ton or medium-duty trucks. These are classified as less-than-truckload (LTL) vehicles.

Unlike traditional freight services that use large semi-trucks or tractor-trailers, hot shot trucking utilizes smaller vehicles that can quickly transport goods and cargo to their destination.

Hot shot trucking can cater to various industries, including oil and gas, construction, agriculture, and manufacturing, where the fast delivery of smaller loads is necessary.

The advantage of hot shot trucking is faster delivery times and more personalized service compared to larger freight carriers. This niche transportation service is valuable for its flexibility, speed, and quick response to time-sensitive transport needs.

Who Needs Hotshot Trucking Insurance?

Hotshot trucking insurance is essential for anyone who offers this trucking service.

This insurance is essential for owner-operators running smaller trucks or small trucking companies specializing in rapid delivery. Freelance drivers offering on-demand services may also need a hotshot trucking insurance policy.

Hotshot truckers require specialized insurance coverage to protect against liabilities, cargo damage, and unforeseen incidents on the road.

Getting the right hotshot trucking insurance provides financial protection and peace of mind for the transporter and their clients in the event of accidents or mishaps during transit.

Hot Shot Trucking Coverage

Hotshot trucking insurance refers to commercial trucking insurance that can be applied to specialized hotshot truckers. Coverage can include:

Liability Insurance: Covers bodily injury or property damage liabilities arising from accidents while operating the truck.
Comprehensive Insurance: Protects against non-collision incidents like theft, vandalism, or natural disasters.
Collision Insurance: Covers damages to the truck resulting from collisions.
Cargo Insurance: Protects the value of the cargo being transported against damage, loss, or theft during transit.
Loading and Unloading Insurance: Covers liabilities during loading or unloading cargo.
Towing and Storage Insurance: Covers costs related to towing and storing the truck in case of breakdowns or accidents.
Bobtail Coverage Insurance: Covers the truck when operated without a trailer, such as when driving back to the home base.
Downtime Insurance: Provides coverage for income lost due to downtime resulting from accidents or covered incidents.
Earned Freight Insurance: Covers the income lost if the cargo can’t be delivered due to a covered incident.
Equipment Coverage: Protects additional equipment used for transportation, such as trailers, chains, and tarps.
Debris Removal Insurance: Covers costs associated with the removal of debris resulting from covered incidents.
Broadened Pollution Insurance: Covers liabilities for environmental damage caused by hazardous material spills during transit.
Loss Mitigation Insurance: Covers expenses incurred to prevent further damage or loss after an incident occurs.
Medical Payments Insurance: Covers medical expenses for injuries sustained by the driver or passengers in the truck.
Family Emergency Expenses Insurance: Provides coverage for emergency expenses incurred by the driver’s family due to a covered incident.
GAP Coverage: This covers the difference between the truck’s actual cash value and the amount still owed on a lease or loan in the event of a total loss.
Umbrella Insurance: Provides additional liability coverage beyond the limits of primary insurance policies.

Cost of Hotshot Trucking Insurance

The cost of hotshot trucking insurance policies varies based on a range of factors.

Most importantly, your premiums depend on what types of coverage you have. The more comprehensive coverage your policy offers, the more expensive your insurance will be.

The following factors can also affect how much your insurance policy costs:

Type of equipment being covered
Coverage limits
Driving history
Cargo
Location
Deductibles

The bottom line is the more you need to be covered, the more expensive your policy will be.

Lowering the Cost of Hotshot Insurance

Want to get the best deal on hotshot trucking insurance? It’s possible to lower the cost of your premiums by:

Comparing quotes to see which company offers the best deal
Increase deductibles to lower your monthly premiums
Get only essential cover to reduce how much you pay

If you want to purchase hotshot insurance on a budget, only cover the essentials. This could add risks over the long run, but it will decrease your monthly premiums.

How to Find Hot Shot Insurance Cover

Contact insurance companies specializing in commercial trucking or freight transportation and ask if they offer any specialized hotshot insurance options. Request quotes tailored to your specific needs and the nature of your hot-shot trucking business.

Comparing multiple quotes and understanding the details of coverage options will help you choose the most suitable insurance broker for your operations.

Final Thoughts

The right commercial truck insurance policy is essential for the smooth operation of any trucking business. Make sure you compare quotes and understand exactly what coverage options you have. Choosing the right policy can make a significant impact on your business.

If you’re in the hotshot trucking business, you must acquire the right vehicle. At Mission Financial Services, we make it easy for owner-operators to access the financing they need to purchase a commercial truck. Get in touch with us to see how easy the application process is.