Insurance for Commercial Vehicles: How to Get Your Trucks on the Road

IBISWorld reports that the commercial auto insurance industry is worth a staggering $52.2 billion in 2022. That’s a lot of premiums! But insurance is necessary if you want to run a legitimate operation with business trucks.

There are various commercial vehicle insurance types to choose from these days. Yet, when searching for “insurance for commercial vehicle” online, you’ll come across limited explanations from insurance providers of what you need, which can be frustrating.

In this guide, we’ll give you the lowdown on all the different commercial truck insurance options on the table. We’ll keep it clear and to the point, with any additional advice we feel will be valuable to you.

So let’s get started.

What Is Commercial Truck Insurance?

Auto insurance for commercial vehicles is a broad topic that could take a long time to cover. In this guide, we’re interested in exploring commercial truck insurance options.

So commercial truck insurance is a collection of relevant coverage options for business trucks. Different coverages can protect you from incurring large costs if your trucks are exposed to various unfortunate events.

Unlike standard truck insurance, commercial truck insurance plans cover you for business activities like transporting products, customers, or livestock, for example.

Yet, there are different liability levels you need to consider. This will depend on the size of your operations, among other things. Primary liability insurance is the first level that anyone will need for commercial activities.

Let’s take a look at the liability levels in more detail:

Primary Liability Insurance for Business Trucks

So the basic level we’ve touched upon already is primary liability insurance. it covers you for property damage and bodily injury that you could cause to others on the road.

The government requires you to have this level of insurance as standard along with your trucking license. It’s relevant to have if you intend to use the trucks or lease them out.

General Liability Insurance for Business Trucks

The federal government also states that you need general liability insurance for your business trucks. This insurance type covers you for unfortunate things that may occur off the road.

For instance, you might have times when people are loading up your trucks. If someone were to get injured in this process, general liability insurance would cover you.

Bobtail Insurance for Business Trucks

Bobtail insurance is a type of non-trucking liability insurance. It’s for business owners and employees that want to use their trucks during out-of-work hours or for non-business-related activities.

This insurance type isn’t a requirement but a choice. You have to ask yourself whether it’s something you really need or whether it’s going to eat into your profits.

Physical Damage Coverage for Business Trucks

If you are worried about natural disasters where you live, you might want to invest in physical damage coverage as a form of commercial insurance for your vehicles. Different insurers will stipulate what sort of natural disaster damage they cover. So, make sure the natural disasters that you are wary of are written into the policy.

Furthermore, physical damage insurance should cover you for damage from vandalism and theft. They should offer coverage for collisions, too.

Motor Cargo Insurance

This is a type of commercial auto insurance that provides coverage for any goods or products you transport. There are several instances where cargo insurance can kick in.

Cargo insurance can offer you coverage for theft of your goods, water damage, and debris removal, for example. Some will provide pollution liability, too.

Then you might expect to get coverage for driver theft as well as loading and unloading damage. Plus, some policies will offer protection against hijackings!

Reefer Breakdown Coverage

For those who have refrigerated trucks, reefer breakdown coverage is a no-brainer to get. It will give you coverage for instances where your refrigerators break down and consequently your goods get spoiled.

Keep in mind that some policies will not cover you for certain goods that you carry. For instance, some insurers will not give you coverage for frozen foods, tobacco, or seafood products.

Trailer Interchange Insurance

Will you be pulling trailers at any point during your business activities? If so, will those trailers belong to another company?

It’s often the case that companies share trailers when they work together to deliver goods as it makes logistical sense. Trailer interchange insurance gives you coverage for any damage or other issues when you are towing someone else’s trailer.

Medical Payment Coverage

Some insurance policies will include medical payment coverage. This is where the insurer will pay out for any medical expenses a driver may need due to an accident while they are using your truck.

If your drivers are going to drive in hazardous conditions, it’s worth thinking about getting this type of coverage. After all, if you had to pay out medical bills for some reason in the future, it’s going to put a large dent in your company’s revenue.

Truck Insurance Tips

Now you know all the relevant types of truck insurance to consider for your business. The question is, how do you know which ones are relevant to your needs and which ones are a waste of time and money?

Well, we’ve put together a few tips to help you determine what insurance types you might need and how to get a good deal. Here are the tips:

Payment Options

There are various ways to pay for commercial insurance. If you want to get a good deal on your insurance, the best payment option is to pay it all in one annual lump sum.

Many insurers will offer you excellent discounts if you are willing to pay a large amount upfront for your insurance. If you can’t pay for a year’s amount, could you pay bi-annually instead? If so, you may still be able to get a decent discount.

You Use Another Business’s Trucks

If you don’t own the trucks that your business uses, you still need to get commercial auto insurance. The reason is that your company could be held liable if the trucks get damaged or have various other issues.

Thus, you need to ask the agent you are dealing with whether your policy will have non-owned autos coverage.

Insurance Payout Limits

There are two types of payout limits insurance companies will offer when it comes to commercial auto insurance. They are:

With an occurrence limit, the insurer will pay out a maximum amount for any claim that you make, regardless of how many times you claim in a year. With an aggregate limit, the insurer will have a limit on how much they can payout in a single year, regardless of how many times you claim in that year.

Check the Deductibles

In most instances, if you find yourself in an accident involving your truck, you will have to pay a certain amount upfront for your insurance to kick in. This amount is your deductable payment and they can vary a lot with different insurers.

If you feel the risks are low for your trucks to get into an accident, you might want to opt for a higher deductible. With higher deductibles, you can expect to get lower insurance rates. Yet, be careful not to set it too high to the point where it would affect your business’s finances if you had to pay the deductible.

A good insurance agent will help you decide on your deductible amount. They will be able to analyze the risks involved in your business and make other suggestions, too.

Ways To Reduce Your Insurance Premium

There are a few things you can do to reduce your insurance premium. It’s always best to consult your agent, as they will know a lot of specifics. However, here are a few suggestions that might work:

  • Choose industry-reputable trucks
  • Invest in secure storage for your trucks
  • Hire experienced and competent drivers
  • Add anti-theft devices to your trucks

GPS tracking applications may also help to lower your premium, along with other newer technologies. So it’s worth doing your research, and newer technologies will often increase the efficiency of your operations as well.

Changing Your Insurance

It makes sense sometimes to change your insurance type when business circumstances change. For example, you might decide to take one of your vehicles off the road for six months or more.

If you have a good agent, then they will be able to help you change your insurance for that vehicle. The idea is to save money by not paying for less costly insurance in that six-month timeframe.

Insurance for Commercial Vehicles Explained

Now you should have a much clearer idea about insurance for commercial vehicles, with a focus on business trucks. The key is to get a reliable agent that you can trust to get the right insurance policies for your needs.

Read more informative articles such as this one by heading over to our main blog page. You can do this by clicking on our home page on the navigation menu above.

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