The trucking industry is vital to the American economy, but it’s also a risky business. With nearly 500,000 large truck accidents occurring in the United States in 2023, commercial truck insurance is a necessary part of any trucking business. Insuring a semi-truck can be a significant expense, and knowing the average monthly cost is essential for budgeting and profitability.
As a leader in flatbed trucking, Chief Carriers understands that insurance is an important part of being a responsible business and a good neighbor to the communities we operate within. We’ll explain the typical expenses associated with semi-truck insurance, average insurance rates, and the factors that can influence your premiums.
The Purpose of Commercial Truck Insurance
Commercial truck insurance protects your business, whether you own a trucking company with a fleet of trucks or you’re an independent owner-operator driving one truck. Accidents happen, and the costs associated with them can be staggering–the average cost is $91K per crash. Without adequate insurance, a single incident could cripple your business.
Aside from traffic accidents, a commercial insurance truck policy covers other risks that may occur in the trucking industry:
- Damage to the truck
- Cargo being hauled
- Operating the truck without a trailer attached
- Using the truck outside of business operations
- Slip-and-fall accidents on the business premises
- Expenses for work-related injuries for drivers
While commercial truck insurance is essential, it can also be a major expense for your business. Factors such as increased litigation and medical expenses to a surge of inexperienced drivers on the road contribute to the rising price of truck insurance. Understanding how insurance rates are calculated will help you navigate the maze of premium figures and coverage types.
What is the Average Semi-Truck Insurance Cost Per Month?
On average, semi-truck insurance can range from $700 to $2,000 per month, but these are just ballpark figures. Semi-truck insurance rates are highly individualized, so your actual costs could be higher or lower depending on factors that can impact your insurance premiums.
Driver’s Experience and Driving Record
Driving history plays a significant role in determining insurance rates. Experienced drivers with clean records generally enjoy lower premiums. Accidents, traffic violations, and previous claims can all increase insurance costs.
Type of Cargo Hauled
Hauling hazardous materials (HAZMAT) or high-value goods like electronics or pharmaceuticals requires specialized coverage and higher premiums. Transporting refrigerated goods or livestock may also increase insurance costs due to the risk of spoilage or injury.
U.S. Department of Transportation (DOT) Authority
A company’s U.S. Department of Transportation (DOT) authority reflects its level of operational risk and compliance with safety regulations. A company operating under its own DOT authority, rather than a company leased to other carriers, generally pays higher insurance premiums because it bears full responsibility for accidents and violations.
Truck Value and Age
Newer and more expensive trucks require higher coverage limits, which means higher premiums. Customized or modified trucks may also cost more to insure due to their increased value and potential for higher repair costs.
Coverage Limits and Deductibles
Coverage limits and deductibles directly impact monthly premiums. Higher coverage limits provide more financial protection in case of an accident but come with higher premiums. Opting for a higher deductible can lower monthly payments but means paying more out-of-pocket when filing a claim.
Operating Radius
Long-haul truckers who cover vast distances generally face higher premiums than those operating locally or regionally. This is because long-haul trucking involves increased risks, such as driving in unfamiliar areas, distractions, and exposure to varying weather conditions.
Location
Where trucks operate also influences insurance rates. Some states have higher semi-truck insurance rates than others due to factors like traffic density, crime rates, and state-specific regulations. States with high population density or accident rates may also have higher insurance premiums.
Types of Commercial Truck Insurance Coverage
Understanding the different types of commercial carrier insurance is essential for choosing the right insurance for 18-wheeler trucks. Here are some key coverage types to consider:
- Primary Liability: Mandatory coverage that protects you financially if you’re found liable for bodily injury or property damage to others in an accident.
- Physical Damage: This covers damage to your truck in events like collisions, theft, fire, or vandalism.
- Cargo Insurance: Protects the goods you’re transporting against damage, loss, or theft.
- Bobtail Insurance: Covers your truck when it’s driven without a trailer attached, such as when it’s used for personal purposes or when returning home after delivering a load.
- Non-Trucking Liability: Provides coverage when you’re using your truck for non-business purposes.
Company vs. Independent Owner-Operator
There is a distinct difference between the commercial truck insurance policies for trucking companies and independent owner-operators. A trucking company manages a fleet of trucks, while an owner-operator only manages their truck, leading to potentially different coverage needs and significantly different insurance costs. Key differences between the coverage include:
- Coverage scope: A trucking company’s policy typically covers a larger range of potential liabilities due to its larger fleet, including potential issues with multiple drivers, while an owner-operator’s policy focuses primarily on a single truck and may have less comprehensive coverage.
- Liability limits: Trucking companies often need to carry higher liability limits due to the increased risk associated with managing a large fleet, whereas an owner-operator may have lower required limits.
- Additional coverage needs: A trucking company might require additional coverage like “non-trucking liability” for personal use of their trucks, whereas an owner-operator usually only needs coverage for commercial driving activities.
- Cost: Generally, a trucking company’s commercial truck insurance is likely to be more expensive than that of an individual owner-operator due to the increased risk and broader coverage needs.
How to Get Commercial Truck Insurance Quotes
Getting commercial truck insurance quotes from multiple providers is crucial to finding the best coverage at the most competitive price. Online comparison tools can help gather quotes and compare coverage options. When requesting quotes, be prepared to provide detailed information about your business, your trucks, your drivers, and the type of cargo you haul.
Tips for Lowering Commercial Truck Insurance Rates
You must have commercial truck insurance to operate legally in the trucking industry, and it can be a large expense depending on your business’s circumstances. Here are some strategies to help you keep your rates as low as possible:
- Invest in Driver Training: Driver training programs can improve driver skills and reduce the likelihood of accidents, potentially leading to lower premiums.
- Embrace Safety Technology: Equipping your trucks with safety features like lane departure warnings, collision avoidance systems, and dashcams can demonstrate your commitment to safety and potentially lower your insurance costs.
- Bundle Your Policies: Consider bundling your semi-truck insurance with other policies, such as general liability or workers’ compensation, for potential discounts.
- Pay for a Year in One Payment: Rather than paying for insurance each month, you’ll save money if you can pay for the year all at once.
- Maintain Good Credit: Having a good credit score could make a difference, so ask your insurer if your good credit history can help you secure more favorable premiums.
Understanding the Cost of Semi-Truck Insurance
Safeguarding your business means safeguarding your truck with commercial truck insurance that protects your vehicle, cargo, and everyone on the road. Understanding how premiums are calculated will help you find the best coverage for your business needs.
At Chief Carriers, our drivers are part of the Chief family, so we prioritize safety and industry compliance. We maintain a strong safety record, invest in driver training, and partner with reputable insurance providers to protect our truck drivers and other motorists. If you’re looking for driving opportunities, consider joining our team.
To learn about other trucking topics, listen to our trucking podcast for industry updates, driver tips, and stories from truckers on the road.
