Commercial Trailer Insurance

Commercial Trailer Insurance: The Ultimate Guide

There are several different types of commercial trailers. It can be an auto hauler, a dry freight trailer, a flatbed trailer, or a utility trailer. Insuring your commercial trailer can be a necessary part of your trucking business. We at East Insurance Group are here to help with all the information you need for insuring your trailer. You can also find the most reasonable rates for commercial trailer insurance with us. 

Here’s everything you need to know about commercial trailer insurance.

Most states require businesses to insure all vehicles and resources used commercially. While the actual requirements may differ in each state, it is generally a good idea to insure your trailer for your business purposes.

Commercial trailer insurance

What Does Trailer Insurance Cover?

Dry freight trailer insurance covers a lot of things. It can be a semi-trailer, a box truck, or a smaller commercial vehicle, but they all require insurance and will typically cover the following:

Liability Coverage

When you are at fault during an accident on road, it pays for damages to the other person involved.

Comprehensive Coverage

It pays for damages that occur on your business premises and not on the road. For example, damages caused by fires, vandalism, theft, etc.

Collision Coverage

It pays for damages caused because of a collision. It covers your trailer and not for the other vehicle.

Cargo Coverage

It pays for damages caused to your goods, merchandise, or any type of cargo you may be hauling while on the road. Note that there might be some exceptions, such as tobacco, liquor, and jewelry.

Debris Removal Coverage

It is a type of cargo insurance that pays for removing debris or goods materials that may have been strewn on the highway because of an accident.

Loading/Unloading Coverage

Another type of cargo insurance pays for damages to the cargo that may have occurred during loading or unloading

Earned Freight Coverage

It pays for any loss of income you might have otherwise earned if your goods/cargo were not damaged, lost, or stolen. It acts as compensation for the shipment you would have otherwise successfully delivered.

Combined Deductible

This means that after an accident, you would have to pay only a single combined deductible for all your liabilities instead of paying for them individually.

How Does Insurance on a Trailer Work?

If you have commercial trailer insurance and your trailer is damaged or stolen, you can file a claim to recover some or all of your loss. 

For example, if you paid $10,000 for a trailer and bought a replacement value collision coverage with a $500 deductible if your trailer gets destroyed, your insurance will pay for a new one after you pay a $500 deductible. 

Do You Need Extra Insurance to Tow a Trailer?

While you’re not legally required to insure a trailer, it’s always a good idea to consider getting the additional level of coverage to protect it against damage or theft.

How Much Does Trailer Insurance Cost?

The cost of the insurance can vary according to the state of operation, type of goods hauled, which determines the type of trailer used, the hauling capacity or weight of the trailer, and distance of travel.

Your regular dry van trailer can cost anywhere between $250-$1000 per month

Within that range, how much your insurance costs will depend on:

  • Driving History: A clean driving record will mean lower risks for the company and hence, lower premiums.
  • Driving Experience: It is more likely that an experienced driver with a commercial driving license can have a clean driving history than, say, a 21-year-old without much commercial driving experience.
  • Area of Operation or Distance Covered: Greater distance can sometimes mean higher premiums.
  • The Limits of Your Policy: If you want to buy insurance that has high coverage limits, then your premium amount will also be more expensive.
  • Deductibles: If you can afford it, then opting for higher deductibles will lower the premium amount.
  • Your Payment Plan: It is generally observed that paying your premium amount upfront once a year instead of paying every month can help you save almost 10%-20%.
  • Your Insurance Company: At the end of the day, the cost of your insurance policy is determined by one of the several insurance companies. The cost can vary depending on whether the company is small or big, new or old.

Additionally, whether or not it is required, it makes good sense to buy property coverage for your commercial trailer for repair or replacement of parts in the case of an accident. You would, especially, want to cover property insurance on your trailer if it has significant value or if you still owe money on it via installments. Else, you may have to pay expenses out of your pocket should any damages occur.

There are several ways to get cheaper insurance for a trailer, including:

  • Hire drivers with a clean record
  • Map out trucking routes
  • Use newer trucks
  • Consider a higher deductible

What Do I Need to Prepare for Commercial Trailer Insurance?

Here’s a simple checklist that shows all the documents you need to get commercial trailer insurance:

Commercial Trailer Insurance Checklist

Do Commercial Trailers Need Insurance?

Commercial trailers need insurance to stay safe and compatible in the market. A commercial trailer has a few responsibilities when carrying something through the public paths. Therefore, it must get coverage from many aspects. In general, commercial trailer insurance will offer liability coverage, collision coverage, cargo coverage, earned freight coverage, debris removal coverage, and comprehensive coverage.

There is also a combined deductible, making it easy for the customer to pay their liabilities after an unfortunate event. Depending on a few factors like driving history, experience, policy limits, and the insurance company, commercial trailer insurance may cost you various amounts. However, by selectively picking what you deal with, you can make these insurance packages more cost-effective.

Read also: Trailer Interchange Insurance

Confused about commercial trailer insurance, or need some help getting a quote? Call us or fill out a quote request form and get all the information you need fast and for free!