It is essential to understand truck insurance in order to ensure that you get the best coverage possible. This information will help you understand not only the purpose of truck insurance but also the key factors that will determine a reliable truck insurance company.
Insurance history
The protection of property owners has been an integral part of insurance coverage. Benjamin Franklin of Philadelphia, 1752 was the founder of one the first insurance programs in the United States. This company was created to provide insurance for fire damage to homes.
Insurance companies now cover a wide range of property types, including homes, vehicles, and everything in between. Contrary to other countries, the United States has seen greater deregulation of insurance over the years. Each state is responsible for providing oversight of insurance practices. These oversight agencies’ names may be different, but they are often known as the Department of Insurance or Insurance Department.
Basic coverage
Primary Liability is the commercial truck insurance coverage required by both state and federal agencies. Primary Liability covers damages caused by the insured driver. This amount is usually a fixed dollar amount.
Physical Damage: This policy protects your truck and trailer from damage. These damages could be caused by a collision, storm or windstorm, fire and theft, earthquake, flood or vandalism to your vehicle. Rates are determined by the equipment insured and coverage is usually a percentage.
Trailer Interchange: Drivers are responsible for damage or loss to trailers or equipment owned by other parties under a trailer interchange agreement. Trailer Interchange covers the costs incurred in these agreements.
Motor Truck Cargo Insurance: This cargo insurance covers the driver against the costs of freight loss or damage. Motor Truck Cargo insurance rates are usually determined by the type of Cargo being hauled.
Non-Trucking Insurance: This insurance covers temporary drivers who have been leased to a ICC regulated carrier. This covers damages to the truck and other equipment during times when the driver cannot be dispatched. They would also be covered by Primary Liability Insurance if the driver is dispatched.
ICC Authority: Interstate Operating Authority refers to permission given by the federal agency, Office of Motor Carrier Safety for the transportation of regulated freight across state lines. Interstate Operating Authority must be obtained by all vehicles whose drivers are looking for employment in interstate transport of regulated cargo.
Why you need insurance coverage for your truck & cargo
It is imperative to have as much coverage as possible, not only because commercial truck insurance must be purchased. America’s highways are dangerous. Because of their sheer size, freight traffic can cause significant damage to these vehicles.
In the end, truck insurance protects you from financial liability that could result from acts of nature, accidents, or loss of freight. Operators cannot handle the high value of trucks and cargoes on their own. For a shipping company to succeed, it is crucial to have commercial truck insurance.
How to Find an Insurance Company
It is essential to find out which companies are operating in your locality. The best place to find this information is at your state’s Department of Insurance. You will also find information about the past of these companies, which will help you make a decision on which company to purchase insurance.
To compare companies, you need to ask the following questions:
How long has the company existed and what is its expertise in truck insurance?
Do they have solid financial backing? This information is typically displayed on business plans and websites. How does the insurance coverage rate compare to the coverage? This information will allow you to assess the value of each policy by comparing them against one another.
How is the company rated in accordance with established rating agencies? These ratings are often displayed in the literature of insurance companies. You can also find this information at the Department of Insurance in your state.
