How Much Does Commercial Truck Insurance Cost?

Trucks or Heavy Goods Vehicles (HGV) are a vital part of many businesses today. Transporting all kinds of goods is crucial for business, but driving a truck can be a dangerous activity. Whether you are an owner-operator or you own a growing fleet of trucks, you should consider the best ways of protecting their assets, and that includes getting HGV insurance.

Costs of your semi-truck insurance, i.e., owner-operator truck insurance, can vary widely. Here, we have a number of factors to consider while understanding the costs and limits of each type of insurance and how best to lower the rates of insurance while still being able to gain maximum benefits in case of damages or liabilities.

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Truck Driver Insurance

While there are several types of semi-truck insurance coverages, what you need as a new business owner will depend on your status as an owner-operator for the business. Suppose you are an owner-operator with a permanent lease to a motor carrier for your trucks. In that case, some aspects of your commercial truck insurance will be covered by the motor carrier, reducing your costs for driver’s insurance. 

On the other hand, if you are an owner-operator under your own authority, you will have to take care of all liabilities for insuring your trucks and your drivers. This is relatively more expensive.

The insurance plan you choose for your business will have a number of provisions covered. Understanding what is covered, what isn’t, how frequently you make payments, and other truck insurance requirements can help you choose the best plan.

Types of Semi Truck Insurance

As trucking continues to be a growing industry, professional truck drivers keep driving more and more. With all those miles, it’s important to secure truck drivers and choose the right truck driver insurance for your business. 

The right insurance for your company will mostly depend on the type of trucks you own and how they are used. For example, a tractor-trailer has higher minimum liability insurance requirements compared to a truck used for local deliveries only. Here are a few main types of truck driver coverages you can choose from:

  • General Liability Insurance: as the core of every truck driver insurance policy, it covers bodily injuries to others and property damages of others.
  • Physical Damage Coverage: covers the repair costs of your truck in case of fire, theft, vandalism, or glass breakage.
  • Non-Trucking Liability: covers the costs in case your truck isn’t under dispatch and used personally.
  • Non-Owned Trailer Liability: covers mishaps if you are pulling someone else’s trailer.
  • Cargo Insurance: insures the cargo you are hauling in case of damage or loss. 

What Influences the Cost of Truck Insurance?

For owner-operators with a permanent lease with a motor carrier, the average truck insurance cost is between $3,000 to $5,000 per year. For owner-operators with their own authority, the cost of semi-truck insurance can be much higher — around $9,000 to 12,000 per truck per year.

Prices of semi-truck insurance have risen steadily over the years, with the cost ranging between $12,000 and $16,000 currently for new authorities. The cost for insurance can depend on a range of factors, other than the owner-operator status too. Here are the factors that can influence your search for cheap truck insurance the most:

  • The cost of your truck
  • What type of goods are being hauled
  • The driver’s age and their experience with a commercial driver’s license
  • Distance being driven
  • Your credit history
  • Your payment plan — whether yearly, monthly, or per policy period

Every truck insurance company rates each of these factors differently, offering different truck insurance quotes and packages. Once you understand what type of insurance you need and what coverages it includes, it helps to compare prices from different policy plans and then make your decision.

Average Commercial Truck Insurance Cost

Average truck insurance costs can vary quite a bit. For example, the cost of primary liability coverage can range from $5,000 to $7,000. Since all businesses require it by law, motor carriers cover this liability. However, under your own authority as an owner-operator, you have to make sure you purchase this coverage in your plan. Additionally, general liability costs can vary between $500-600.

Physical damage or basic truck coverage costs range from $1,000-$3,000, including both collision and comprehensive insurance. Occupational accident coverages cost business owners $1,600-$2,200, whereas the cargo insurance really varies according to what type of cargo is being hauled. Bobtail insurance, i.e., insurance for damages when not hauling any cargo and on personal business, costs about $350-$400.

In addition to the above-recommended insurance coverages, here are some other liabilities you may want to consider for your business:

  • Trailer Interchange Insurance: Required when you are hauling someone else’s trailer full of goods, and the company that owns the trailer does not have insurance to cover their goods.
  • Umbrella Insurance: Costing about $500-$700, umbrella insurance covers any gaps that may have occurred in your policy.
  • Uninsured/Underinsured Motorist: The least expensive yet very useful type of coverage, it covers damages caused to you when you are involved in an accident without your fault and the other person is not insured enough to cover your expenses.
  • Hazmat Insurance: If you are hauling hazardous materials such as chemicals, fertilizers, or fuels, then you will need this type of insurance.
  • Livestock Cargo Insurance: As the name suggests, when hauling live animals, in the event of injury, death, or escape, this insurance will be useful to you.

How to Lower Truck Insurance Rates

Finding cheap truck insurance isn’t impossible, but you need to know a thing or two to get it. As we mentioned before, trucking insurance companies offer quotes that depend on many different factors. However, there are a few ways you can lower the rates of your 18 wheeler insurance.

Better Driving History

Trucking insurance companies generally want to work with drivers who don’t cost them much money. They will offer cheaper truck insurance rates to businesses whose drivers have clean driving records.

Bundle Package

To lower the costs of your semi-truck insurance, it is always a better practice to bundle together all your liabilities in one heavy truck insurance package rather than buy them separately.

Paying Yearly

Trucking companies that pay their insurance in a lump sum once a year, as opposed to paying monthly, reduce their premium overall by almost 10%-20%. With the high cost of semi-truck insurance policies, however, this figure can vary.

For example, a truck insurance quote that costs $11,300 annually may seem too much. However, if you break it into monthly payments, you get an average semi truck insurance cost of $942 per month. 

Compare Truck Insurance Rates

To find the best or the cheapest truck insurance you need to shop for policy packages from different trucking insurance companies and compare the premiums, deductibles, and coverages in each. Companies rate different factors on which your insurance depends differently and therefore offer their policy packages at different prices.

Consider Higher Deductibles

In order to keep your premiums low, you might want to consider higher deductibles and lower limits.

Where is the Cheapest Truck Insurance in the US?

When looking for affordable truck insurance policies, one of the best ways to find one is to look into truck insurance rates by state. Out of the 50 states, the following have the cheapest commercial truck insurance:

  • Idaho
  • Mississippi
  • Wyoming
  • Iowa
  • Nebraska

However, the insurance rates in these states can change depending on whether you don’t have your U.S. Department of Transportation Administrations (USDOT) filling. For example, Oklahoma isn’t the most affordable state for trucking insurance, but it is a great state to own a commercial trucking business due to reasonable rules and regulations, but also, low gas prices.

 

As you can see, there are several ways you can keep your truck insurance low. East Insurance Group offers competitive rates for your trucking insurance needs, so what are you waiting for? Just drop us a line or give us a call, and we’ll set you up with just the insurance plan you need!