Semi-truck insurance, also called owner-operator or commercial truck insurance, is a blanket term for a collection of policies for truck drivers. Many of these policies cover truckers’ legal liabilities in different situations, such as hauling cargo or nonbusiness driving. Owner-operators can expect to pay anywhere from $3,000 to $16,000 per year for truck insurance.
Whatever commercial truck insurance policies you need, you want to work with a company that understands your risks and the regulations in your industry. As a top broker, CoverWallet can help you find an affordable policy that fits your specific needs. Visit its website to compare quotes.
Semi-truck Insurance Costs
The average costs of commercial truck insurance vary widely because there are several different coverages truckers may need. It can also vary due to ownership status. As such, it is difficult to obtain actual quotes online without actual information on specific trucks, including Department of Transportation information. However, several providers and agencies do publish estimated costs or average costs.
Progressive states that the average annual costs for commercial truck insurance1 are:
- $8,832 for specialty trucks
- $13,500 for transport trucks
Meanwhile, Forerunner insurance indicates that the average annual costs for semi-truck insurance2 are:
- $3,000 to $5,000 for owner-operators who lease onto a motor carrier
- $9,000 to $12,000 for an owner-operator with their own authority
- $12,000 to $16,000 for a brand-new trucking business
- $5,000 to $7,000 for primary liability
Factors That Impact Semi-truck Insurance Costs
As with all small business insurance, how much your truck insurance costs depends on how your insurer weighs these factors:
- Ownership status: If you are an owner-operator on a permanent lease, the motor carrier generally covers your public liability, which greatly reduces your overall insurance costs. However, owner-operators with their own authority pay for their general liability.
- Cargo type: Risks, and therefore premiums, typically are much lower if you’re hauling hay compared to hauling a hazardous material, like fuel.
- Weight of freight: Heavier loads usually translate into higher premiums.
- Driving distance: The farther you travel, the greater the risk of an accident, and that impacts your premium.
- Truck value: Physical damage premiums are a percentage of the truck’s value, so more valuable trucks cost more to insure.
- Type of physical damage coverage: Insuring your truck’s actual cash value (ACV) results in a higher premium—but the stated coverage amount is based upon your estimated value. Choosing an ACV option typically costs less.
- Credit history: Insurers check credit scores and history to help determine if you’re a safe risk. They see a poor credit report as an indication that you may cost them money, and they adjust your premium accordingly.
- Loss history: Insurance companies often decrease premiums for truckers who file few claims.
- CDL experience: The more experience you acquire after obtaining your commercial driver’s license (CDL), the less risk you present to an insurance company. This is typically reflected in low premiums.
- Deductible amount: Higher deductibles mean lower premiums. If you can afford to pay more out of pocket on a claim, then you might want to raise your deductible.
- Coverage limits: Policy limits are the amount the insurer pays for claims. Opting for high limits translates into higher premiums because the insurance company wants to cover the potential cost to them.
Interested in getting quality coverage at an affordable price? Check out our tips on the ways to save money on business insurance.
Common Semi-truck Insurance Coverages
Truck drivers need several types of commercial truck insurance coverage; however, the coverage you need depends primarily on your owner-operator status. There are two types of statuses: owner-operators under lease to a motor carrier and owner-operators working under their own authority. An owner-operator under a permanent lease with a motor carrier usually has some insurance needs covered by the motor carrier.
Type of Insurance | What It Covers | Who Needs It |
|---|---|---|
General liability | Third-party property damage and bodily harm | Drivers with authority and motor carriers |
Trucking or primary liability | Third-party property damage and physical injury resulting from | Drivers with authority and motor carriers |
Non-trucking liability | Third-party damages when you are using your truck for non-business purposes | Drivers under lease |
Bobtail | Third-party damages when you are using your truck for businesses purposes are not hauling a load | Drivers under lease |
Physical damage | Damage to your truck caused by your collision, theft, vandalism, or natural disaster | All owner-operators |
Motor truck cargo | Damage to the cargo you’re hauling | All owner-operators |
Workers’ compensation | Employees’ lost wages and medical bills after a work-related injury or illness | All drivers and motor carriers with employees |
Also called public liability insurance in the trucking industry, general liability insurance covers third-party bodily injuries and property damage not related to truck driving. For example, general liability covers injuries a client sustains if they slip in your garage but not those sustained if you hit them with your rig.
Owner-operators with authority, freight forwarders, and motor carriers are required by law to carry public liability insurance. However, the coverage is a good idea for any business owner because it pays for a number of common business risks. Drivers under lease do not usually need general liability insurance as most are covered by the motor carrier’s policy.
Trucking liability insurance, also known as primary liability, pays for injuries and property damage you may cause others while operating your truck. The Federal Motor Carrier Safety Administration (FMCSA) requires a minimum liability limit of $750,000 combined single limit (CSL) or $1 million for truckers needing a federal filing.
Nontrucking liability insurance covers damages and injuries to third parties that occur when you’re driving your truck for nonbusiness purposes, such as running personal errands. If you have a truck accident when you’re not working, nontrucking liability pays for the other person’s medical bills and property damage.
Bobtail insurance is liability insurance that covers you and your semi-truck when you’re driving for business but not hauling a load. The policy pays your legal bills if someone sues you after an accident. Motor carriers often require leased drivers to carry bobtail insurance.
Some examples of accidents that trigger bobtail insurance include those that occur:
- On the way to pick up your first load.
- After you drop off a load and are on your way to pick up the next.
- On your way home after a delivery.
Did You Know?
Bobtail insurance is often confused with nontrucking liability coverage. Both cover gaps in the liability insurance commonly provided by motor carriers. However, bobtail insurance covers business-related driving while nontrucking insurance is for personal driving.
Physical damage insurance pays for damages and repairs to your truck caused by certain covered perils, including accidents, natural disasters, theft, and vandalism. While not legally required, most lenders do require physical damage insurance for financing.
Physical damage insurance comes in two parts:
- Collision: Pays for damage to your rig when it collides with another vehicle or object.
- Comprehensive: Pays for damage caused by most other perils, including theft, hail, vandalism, and fire.
All owner-operators need physical damage insurance to protect their investment in their trucks, and this includes drivers under a lease. Most motor carriers’ liability insurance extends to drivers, but that doesn’t cover physical damage to the driver’s truck.
Motor truck cargo insurance covers your responsibility for the cargo you carry, typically paying out when it’s lost or damaged. Common claim triggers for motor truck cargo insurance include:
- Fire
- Collision
- Theft
- Water damage
- Equipment breakdown
- Striking of a load
Workers’ compensation insurance is a coverage that pays employees’ medical costs and lost wages if there are work-related illnesses or injuries. Typically, only motor carriers and owner-operators with employees have to get workers’ compensation. Requirements vary by state, so check your local authority to find out what is required.
Additional Semi-truck Insurance Coverage
In addition to the primary policies listed above for owner-operator truck drivers, there are several supplemental coverages you may want to add to your policy depending on your specific circumstances. Some of these coverages can be added to your primary policies through riders, while others may need to be purchased separately:
- Trailer interchange endorsement: Trailer interchange insurance pays for physical damage you cause to another person’s trailer. It is important for truckers and motor carriers that regularly enter trailer interchange agreements. This endorsement is usually added to a liability policy to cover damage caused by fire, theft, explosion, collision, or vandalism.
- Hazmat truck insurance: This isn’t always a separate policy or endorsement, but it’s worth noting that hauling hazardous materials is strictly regulated. Federal law increases the mandatory minimum liability coverage to $1 million for any trucker hauling hazardous materials, such as fuels, chemicals, or fertilizers.
- Livestock cargo insurance: Hauling live animals creates a unique set of risks, including the possibility that your cargo suffers an injury, escapes confinement, or dies en route. These risks are typically excluded from standard truck insurance policies and make a specific livestock cargo policy necessary for drivers who transport animals. Policies typically pay for dead and injured livestock as well as carcass removal.
- Trucking umbrella insurance: The amount of damage a semi-truck can cause means claims often exceed your truck liability limits, and this makes trucking umbrella insurance valuable coverage. Like other commercial umbrella policies, this policy extends the limits of underlying liability policies. If a claim costs more than what your other insurance covers, umbrella liability pays the rest.
- Uninsured and underinsured coverage: Uninsured and underinsured motorist insurance covers your costs after an accident with another driver who is either uninsured or whose limits aren’t high enough to cover your damages. It’s also the least expensive coverage but well worth the cost if you end up needing it.
Commercial Truck Insurance Requirements
Authority | Form(s) to be Used | Insurance Required | Minimum Coverage Amount |
|---|---|---|---|
Motor Carrier, Freight | BMC-91 or BMC-91X | General liability | $750,000 to $5 million, depending on commodities transported |
Motor Carrier, People | BMC-91 or BMC-91X | General liability | $300,000 for nonhazardous freight under 10,001 pounds |
Motor Carrier, Household Goods | BMC-34 or BMC-83 | Cargo | $5 million for more than 15 passengers to $1.5 million for fewer than 15 passengers |
Motor Carrier, Surety Bond | BMC-84 or BMC-85 | Surety bond | $5,000 per vehicle with $10,000 per occurrence |
Source: Federal Motor Carrier Safety Administration (FMCSA).
Insurance Filing Requirements
Truckers applying for certain authorities, namely motor carriers, brokerages, and freight forwarders, must demonstrate they have the appropriate insurance by filing with the FMCSA. Federal filings are often required for interstate trucking, hauling hazardous materials, for-hire trucking, and for-hire people transport.
In addition to federal filings, truckers may also have state-specific commercial truck insurance requirements. For instance, Alabama, Arkansas, Louisiana, Mississippi, and Pennsylvania require certificates of insurance (COI) when you drive an overweight vehicle, carry an overweight load, or own an oversized truck or trailer.
FMCSA has a mobile app called QCMobile, which business owners can use to verify an entity’s operating authority and United States DOT number. The app also offers functionalities previously provided by the automated phone system as well as access to USDOT number status information.
Frequently Asked Questions (FAQs)
Semi-truck insurance is a policy or combination of policies that protect a business by covering losses directly to the business, property, or third parties damaged by your vehicle or harmed by your business operations.
Costs vary widely based on the specific business but can range from $3,000 to $16,000 annually.
The Federal Motor Carrier Safety Administration requires a minimum liability policy of $750,000 for freight vehicles.
There are currently 38.9 million registered trucks—95.7% of which are for companies operating with 10 or fewer trucks.3
According to the Bureau of Labor Statistics, there are 897,370 people employed in the trucking transportation industry. Texas has the highest involvement with 210,940 drivers.4
Bottom Line
Getting the best semi-truck insurance for your business requires focusing on value, not price. The cheapest policies are not often the best; also, insurance coverage that is too low can hurt your business if you’re driving under your own authority because it can prevent you from getting jobs with freight brokers. Owner-operators who want the appropriate coverage should work with a broker that has experience in truck insurance.
For more guidance on finding the right semi-truck insurance, contact the experts at CoverWallet. Not only has it produced e-books to help new trucking businesses get started, but it is also able to work with providers to help you find the right coverage. Get a free, no-obligation quote in a few seconds.
1 https://www.progressivecommercial.com/commercial-auto-insurance/truck-insurance/commercial-truck-insurance-cost/
2 https://www.forerunnerinsurance.com/what-does-average-semi-truck-insurance-costs-for-owner-operators/
3 https://www.trucking.org/economics-and-industry-data
4 https://www.bls.gov/oes/current/oes533032.htm
