Truckers keep the supply chain moving; without them, businesses and private individuals would not have access to the flow of goods they need to work and live. Among the many types of truckers are those hauling refrigerated goods, or “reefers”, for short.
Reefer trucking insurance can be a complex topic because these trucks are more nuanced than just a vehicle with a trailer. Reefer trucks rely on refrigeration units and other specialized tools to keep their cargo safe and in good condition until it reaches its destination.
When something goes wrong with these elements, standard trucking insurance coverage may not be sufficient. Here’s what reefer trucking insurance coverage should include to make sure temperature-sensitive goods—and the people who transport them—are protected.
About Trucking Insurance
Trucking insurance as a whole is an overarching concept in which multiple types of policies are nested. Everything from damage to the truck and cargo to driver injury (or the driver injuring someone else) should be included in the myriad of policies that truckers carry.
Most types of trucking insurance work well for reefers, too; however, it is common for trucks transporting temperature- or humidity-controlled goods to need extra coverage not generally included in other policies. The basics for any trucker typically include:
Liability Insurance
Liability insurance provides coverage for accidents and third-party damage. It is a form of both legal and financial protection for truckers who may harm someone with their truck or damage their property, such as their car.
Cargo Insurance
Cargo insurance can pay for the lost value of damaged or destroyed cargo. Cargo that succumbs to fire, collision, falling out of the trailer, and other causes may all be covered.
Auto Insurance
Large truck repairs can be expensive. Auto insurance can pay for damage to the trucker’s vehicle or repairs necessary to keep the truck going to its destination.
Why Specialized Insurance for Refrigerated Trucks?
Refrigerated trucks face risks that other types of truckers do not. Cargo spoilage is one potential risk, but other perils include transit delays and damage to the refrigeration unit. In some reefer trucks, environmental pollution is even considered if the cooling unit uses freon.
Should the truck be involved in an accident, this freon can evaporate into the air, leaving truckers on the hook for environmental damage.
The most important types of insurance, specifically for refrigerated trucking companies, are:
Reefer Breakdown Insurance
Without question, reefer drivers need reefer breakdown insurance. Standard cargo insurance does not usually cover the cargo that reefers are hauling. Anything time-sensitive, temperature-sensitive, or prone to destruction on the way to its destination may be automatically excluded from cargo insurance. Similarly, regular auto insurance coverage will not pay for damage to the refrigeration unit.
Reefer breakdown insurance can offer protection for sensitive cargo should something happen that compromises it along the way. It may cover the spoiled cargo’s value and address the cost of repairing a refrigeration unit if it fails in transit.
However, not all types of cargo spoilage will be included in a reefer breakdown policy. For instance, if the truck is delayed in traffic and the cargo is no longer usable, most policies will not cover this loss without a separate endorsement.
Some policies define “breakdown” as failing to maintain the proper temperature in the unit (which could occur due to an error in setting the temperature). In contrast, others strictly limit coverage to scenarios in which the unit is broken.
Earned Freight
An additional type of useful coverage for reefer trucking is earned freight protection. If a trucker experiences an issue with the refrigeration unit while in transit to the destination and the cargo can no longer be delivered, earned freight coverage can replace the income that would have been earned from a successful delivery. In a type of trucking where cargo loss is more common, this type of protection can add peace of mind.
Protect Your Refrigerated Trucking Operations With Burton & Company
Refrigerated trucking units serve an essential role in the supply chain, providing access to time- and temperature-sensitive cargo ranging from food to medication. However, this specialized role makes reefer drivers more susceptible to losses and damage en route.
The experts at Burton & Company can help you understand which types of insurance protection are most valuable for your reefer trucking business and how to secure additional endorsements or protection in the areas that pose the most risk.
Contact Burton & Company to uncover customized insurance solutions for cold chain logistics, ensuring the safety and stability of your operations.
