Independent truck drivers, commercial trucking companies, and other businesses that use trucks in their day-to-day operations rely on trucking insurance to remain protected against risks. Commercial trucking insurance is a specific type of auto insurance designed to meet the unique needs of trucking businesses.
Even if a company owns just one truck, insurance is essential to protect against significant financial losses. Learn more about trucking insurance and why certain companies in the transportation industry should carry a trucking insurance policy.
Why Trucking Companies Should Carry Trucking Insurance
Trucking insurance enables trucking businesses and for-hire truckers to protect their livelihood. Despite common belief, trucking insurance does not need to be a substantial expenditure. Instead, it can help trucking companies survive the financial burden of a disaster or accident. Here are some of the primary reasons that trucking insurance should be acquired by trucking companies:
1. Insurance Is Required By Law
One of the most important reasons to obtain trucking insurance is to meet legal requirements. Any business that uses one or more trucks as part of its daily operations will require insurance to protect against injuries and damage to people or property. At a minimum, primary liability truck insurance is generally a requirement for acquiring a trucking license.
However, a primary insurance policy only covers damage to another person or vehicle in the event of an accident. General liability is often recommended to trucking businesses to achieve more expansive coverage in the case of a lawsuit or slander, false advertising, or libel claim against the business.
2. General Liability Insurance Has Exclusions
Some companies are under the impression that their general liability insurance covers all incidents that could arise during normal operations. Unfortunately, general liability insurance has many exclusions, including commercial auto accidents. While general liability insurance covers the cost of property damage claims, medical expenses if someone becomes injured at the company, advertising injury claims, administrative costs, court courts, settlements and judgments, it does not cover business owners or employees who may have an accident while driving for work. Instead, a trucking policy is needed to cover bodily injury, damaged property, driver accidents at delivery locations, and other costly events.
3. Cargo Needs To Be Protected
Many businesses use trucks to transport goods from one destination to another, whether that destination is a warehouse, another business, or a customer’s home. Regardless of what is being hauled, trucking insurance can help protect valuable cargo.
Cargo insurance is a common component of trucking insurance that protects the goods being hauled from a wide range of scenarios. Collisions can occur, loads can come undone, and vehicle fires can spread quickly, resulting in catastrophic damage to the vehicle itself and its contents. Trucking insurance can help cover the cost to replace lost or damaged cargo.
4. Repair Costs To Damaged Trucks Are Minimized
Even the best truck drivers may experience the occasional accident. Driving any commercial vehicle, especially larger trucks, puts drivers and other people on the road at risk for serious injuries or property damage. Trucking insurance can help protect trucking companies from the cost of expensive repairs for property damage that occurs while operating a truck for work purposes.
While a general liability policy covers damage to other people’s property, physical damage coverage protects damage to the business’ own fleet of trucks. Physical damage coverage is typically not required, but can save companies a significant amount of money in the event of a collision or other accident.
5. Insurance Builds Customer Confidence
Trucking businesses that deliver or transport goods to other companies can greatly benefit from carrying trucking insurance. With a trucking insurance policy, trucking companies can develop a reputation based on trustworthiness and professionalism. Clients are more likely to work with a trucking company that is protected with sufficient insurance coverage as they know that their goods or merchandise is in good hands. Customers often feel more comfortable doing business with businesses that are financially protected against potential losses.
6. Trucking Insurance Helps To Keep Businesses Going
According to a FleetNet Benchmarkit executive summary from the third quarter of 2020, the average cost of mechanical repairs for commercial trucks was $542, a record high for the year. Unexpected repairs, along with regular maintenance and fuel costs, can put a major dent in a company’s vehicle budget.
If a driver should get into an accident that damages the truck, a third party, or another person’s property, a trucking company could face significant costs that could potentially put them out of business. Trucking insurance provides protection against a wide range of incidents which allows the business to grow and thrive.
Request A Quote For Trucking Insurance Today
As every business is unique, it is important to speak with an experienced insurance agent to determine what type of coverage is best suited for the company and how much coverage is required to remain fully protected. For more information about why some businesses should carry trucking insurance or to request a quote for a policy, contact the experts at Burton & Company online today.