Purchasing the right commercial truck is not the only dilemma a truck owner will go through. After purchasing a truck, it is important to choose the right commercial truck insurance. There are a lot of seasoned carrier companies and drivers who are well versed with everything related to commercial truck insurance; but the new commercial truck owners and business owners may find the insurance part of truck purchase quite tricky.

The annual expense of a commercial truck insurance can be a hefty amount. Therefore, to make the most of the insurance, it is important to know what type of coverage the trucks will need. Some accidents are inevitable, and the cost of repair can be a significant amount. To avoid the compelling cost, truck owners much find a commercial truck insurance policy that is well-suited to their vehicle.

Commercial truck owners can choose from different types of insurance after assessing factors such as the average costs and ways to save money on a particular insurance cost. Here are some different types of insurance a commercial truck owner should know about.

Liability insurance
This type of insurance covers all the damages caused to the other party or parties that were involved in the incident. Federal Motor Carrier Safety Administration (FMCSA) needs this primary liability coverage to obtain the owner’s authority. FMCSA usually take around $750,000 as primary liability coverage, however, most shippers or brokers take around $1,000,000.

Physical damage insurance
This insurance will cover all damages to the vehicle from various causes. The law does not require this type of insurance; however, it is important to have it as it covers the investment the owners make in their trucks.

Cargo insurance
This insurance covers the cost that is involved in mitigation of losses due to damaged or stolen goods that were hauled in the truck. A cargo insurance of around $5,000 is required by the federal government.

Reefer insurance
In the produce transportation industry, having this coverage is crucial. It covers the damage that is done to the cargo inside the truck due to the reefer motor failure. An important thing to remember is that if the truck owner has this insurance, the reefer unit needs to me maintained properly. The records of the same must also be kept safely as it helps with the coverage.

Bobtail insurance
This liability insurance covers the truck even when it is being driven without the trailer. Though it is not mandatory for the truck operators to trail the trucks in their home, a bobtail insurance is recommended.

Average costs of a commercial truck insurance
There are five essential types of commercial truck insurance. The average cost of these insurance are mentioned below:

For primary liability insurance, the average cost is $5000 – $7000 annually

• For physical damage insurance, the average annual cost is around $2000 to $3000annually.
• For cargo insurance, the average annual cost is around $1000 deductible.
• For reefer insurance, the average annual cost is around $2500 deductible.
• For bobtail insurance, the average annual cost is around $350 to $400.

If you total the average costs of different insurance, it is between $7350 and $10,400, excluding deductibles. The rates mentioned above are averaged assuming the driver’s safe driving record. Hence, for new authorities, the prices may be increased.

There are certain factors that affect the cost of your commercial truck insurance. These factors include the age of the owner, driving record, the age and condition of the equipment, the types of commodities the trucks haul, the lanes the truck will take, and state requirements.

Most commercial truck companies finance these payments over a period of some months. The finance company adds a certain amount of interest to the total policy cost. Post adding the interest, the structure of the payment plan is presented to the carrier companies. For example, some finance companies will require the carrier company to make a down payment of around 10% to 20% of the policy cost, and then put an interest on the monthly payments of the insurance for 10 months. Some finance companies may not require any down payment and divide the interest in equal parts for 12 months.

Important tips for owners

• It is important to get insured soon after making the purchase of the commercial trucks.
• Research is important when it comes to commercial truck insurance. Browsing through different insurance policies and plans on the Internet is important. Owners must avoid making a hasty decision while buying a commercial truck insurance.
• Compare different insurance and don’t settle for one just because of a low price of the insurance. Insurance plans that are low priced may have some loopholes that the truck owners may miss; hence, being careful is important.
• Recording evidence of each incident will help the owners during a claim.