If you are starting a trucking company in the United States, you might be wondering how much you will pay for insurance. You should understand it will be more expensive than traditional auto insurance for a sedan, a truck, or an SUV. Not only will it be more costly, but you will also need to purchase several types of insurance.
According to simplexgroup.net/los-angeles/commercial-trucking-insurance/, you should hire a company specialized in trucking insurance to receive the best deals. It is helpful to know the different types of trucking insurance you need and the approximate cost of each type of insurance.
General insurance covers any accident that may happen on the premises of your business. Most trucking companies are a bevy of activity, and clients may come to visit your headquarters. It is likely you will have people who are not employees of your company loading and unloading trucks. You may also have drivers who are off duty entering and exiting your facility. Therefore, you will need insurance to protect yourself in the event someone injures themselves.
A general insurance policy for business can cost between $350 to $3000. Working with a company that specializes in trucking insurance can save you money on your liability insurance policy.
If your company operates trucks over 10,001 pounds and travels across state lines, or if you transport enough hazardous material you need placards, you will be under the authority of the Federal Motor Carrier’s Safety Administration. This is an agency within the Department of Transportation that creates and enforces rules for commercial truckers.
The FMCSA requires the trucking companies it regulates to carry $750,000 to $5,000,000 of insurance, depending on the cargo transported. You must carry $300,000 of insurance for non-hazardous freight moved only in vehicles weighing under 10,001 lbs. If you carry hazardous material, you will have to have about $300,000 worth of insurance.
The average annual cost of a liability insurance policy for a commercial truck in the United States is $8,000 to $14,000. Although it is expensive, it is a necessary cost. If you do not have this insurance, the FMCSA will fine you or shut down operations. If you have an uninsured accident, you may be required to pay millions of dollars.
Trucking accidents often result in deaths. Not only will you pay medical bills and funeral costs, but you could also be sued for wrongful death. This happening to small trucking companies would likely put them out of business.
If you are a moving company hauling household goods across state lines, the FMCSA requires you to buy cargo insurance. You will need cargo insurance of $5,000 for each vehicle and $10,000 for each occurrence. You may need more depending on the type of cargo you haul and the states you travel through. You are likely to need more than the law requires to make your clients happy.
Your clients will request you to be insured for the full value of the product they have trusted you with. A cargo insurance policy will normally cost anywhere between $400 and $18,000 a year per truck.
Insurance is one of the most important things needed to operate a trucking company. Although it is a major expense, your company must have it to operate.