What do you know about motor truck cargo insurance companies? Read the article to know what motor cargo insurance companies cover and what do not.
What Do Motor Truck Cargo Insurance Companies Cover?
Risks faced by commercial drivers on the road include collisions, bad weather, and equipment failures. Carriers and drivers may be protected by trucking insurance from these losses, but it is simple to forget about a different frequent risk: lost or damaged cargo.
Standard trucking liability policies might not offer the coverage you need if something happens to freight while it’s in route because for-hire transporters don’t own the cargo they transport. Additionally, because cargo can be quite precious, you run the risk of being held accountable for costly losses and losing the trust of your clients.
To protect their liability for the items they transport, all carriers should think about purchasing motor truck cargo insurance. Other federal and state rules can also be applicable, and the FMCSA additionally mandates that vehicles have cargo insurance for interstate trade.
Any liability for products in transportation that are lost or damaged as a result of incidents like fires, wrecks, or collisions is covered by motor truck cargo insurance. These plans may also cover expenses like clearing debris from public streets, stopping further cargo damage, and paying for legal defence.
The premiums and coverage limitations for cargo insurance are mostly based on the cargo itself because the cost of cargo can vary greatly. The price of a policy is often determined by the kind of cargo, the number of trucks involved, and the particular trucking operation. But you may also buy broad insurance that has a price based on gross sales. This can be especially useful if carriers must use a sizable fleet to complete an order or if cargo must constantly change vehicles.
The party that actually owns the items you’ll be transporting is one of the most crucial issues to consider when thinking about cargo insurance. In order to protect their own interests, your clients could stipulate that you obtain this coverage as part of your contract. Unexpected losses could seriously harm your company’s reputation and relationships with your clients.
Before purchasing a cargo insurance coverage, you should negotiate a mutual value for the cargo with your clients. In the event that any products are destroyed during shipping and your policy doesn’t offer sufficient coverage, you may still be liable for the balance of the costs. Additionally, you should make sure that all of the client’s cargo declarations are accurate because any serious mistakes could result in an insurance company rejecting a claim.
Typical Exclusions of Motor Truck Cargo Insurance Companies
Due to the widespread use of cargo insurance, a wide range of operations and cargo are typically covered by policies. But the majority of policies won’t provide coverage for the following:
- Anything retained longer than 72 hours in a transporter’s warehouse
- packaging for shipping
- these kinds of automobiles:
- Dumpster trucks
- Passenger cars, including limos and buses
- Hearing aids
the following kinds of cargo:
- No. Paper
- Illegal drugs
- drug industry
- Radioactive substances
A Needs Analysis of Your Insurance
Any motor carrier and driver can benefit greatly from having cargo insurance, as well as other types of protection.
Get in touch with Shawn Burroughs to request a quotation, explore more company protection options, or learn more about our resources tailored specifically for the trucking industry.