Local freight trucking companies are legally required to carry trucking insurance. “Full coverage” entails a
combination of primary liability and physical damage insurance.
Primary liability coverage provides financial protection if the driver damages someone else’s
property or causes bodily injury while operating the truck for business. Every state has different
required minimums, delineated by the amount that must be available for payment per person and
the total amount paid per accident. As long as you meet the minimums, you are compliant.
However, the minimums might not be sufficient to provide the protection your assets require, so
be sure to discuss and decide on an appropriate amount for your own situation with your
Physical damage – which falls under both comprehensive and collision insurance – is for your
own vehicle. “Collision” covers damage to your truck if you hit something or it overturns.
“Comprehensive” covers nearly all other damage, such as fire, theft and vandalism, unless it is
An additional necessity is motor truck cargo insurance, which covers the value of the goods you are hauling
and provides restitution if that cargo is damaged, stolen or lost. It also covers the costs of debris removal or
any required freight charges that may result from an accident. Your premium will be based on the types of
cargo you haul and may exclude prescription drugs, tobacco and alcohol.
As mentioned above, primary liability provides protection when the truck is being driven for business.
However, local truckers frequently face certain scenarios that require additional consideration, and they
potentially need additional insurance.
Non-trucking liability (NTL) – If you are an owner-operator, working either independently or
under permanent contract with a motor carrier, you are covered under your own or the motor
carrier’s primary liability policy. However, if your truck is ever driven for personal use, this primary
liability would not apply, so you would need to purchase NTL for these instances.
Bobtail insurance – Although less common than with OTR drivers, some local haulers still operate
with a cab and trailer. Bobtail insurance covers those situations when you are driving just the cab
without a trailer attached. This additional coverage is typically needed only for drivers under a lease
agreement. For owner-operators, bobtail is usually included in your primary liability coverage.
However, it’s always wise to confirm this, as policies can differ.
Trailer interchange insurance – If you do not own the trailers you are using but are merely
transporting someone else’s trailer from one location to another, you’ll need trailer interchange
insurance, which is essentially physical damage insurance for another owner’s trailer while in your
Commercial fleet insurance – If you own and operate more than one truck, fleet insurance is
usually a more cost-effective option than purchasing insurance for each individual vehicle.
Umbrella insurance – Recognizing that some lawsuits can result in expenses well beyond your
primary liability limits, umbrella insurance provides a cost-effective way to protect against
catastrophic loss. Umbrella coverage will not pay for losses to your own property or possessions
but will protect you if you are found at fault for someone else’s injury, death or property damage;
it picks up where your underlying liability policy ends.
Refrigeration breakdown – If your truck or fleet includes heating and refrigeration units, this
insurance will cover the liability costs associated with cargo loss due to equipment failure.
Permanently attached equipment – Some property damage policies exclude specific types of
permanently attached equipment, such as electronic equipment or custom accessories like murals,
decals and running boards. If these items represent a significant investment, you can purchase a
“permanently attached equipment” policy to ensure reimbursement if they are damaged.
Specialized coverage – Specialized policies address the unique needs of certain types of
hauling. This includes insurance for sand and gravel hauling, asphalt hauling (either hot or liquid),
logging trucks, tankers, steel hauling and refrigerated trucks.
Business owner insurance – If you are not only a trucker but also a business owner with a
physical location and employees, your insurance professional can help with the additional
insurance you require, including a business owners policy, workers’ compensation or other
common policies, such as data breach insurance.
There are many riders, policies and exceptions with trucking insurance; much depends on whether you own or
lease the truck, cab or trailer, whether you are an independent owner-operator or drive under permanent
contract with an individual company, and what you regularly haul. An insurance professional familiar with local
trucking can review your specific driving operations to make sure you have any policy additions or
adjustments needed for many miles of safe hauling.