Owner-operators must carry commercial truck insurance. There are several factors affecting the cost of owner-operator truck insurance. This article will discuss the costs of owner-operator truck insurance, how to save money on the insurance, and who needs it. We’ll also look at companies that offer owner-operator truck insurance coverages.
- How much does owner-operator truck insurance cost?
- How much is the average owner operator truck insurance cost per month?
- What factors affect owner-operator truck insurance cost?
- How to save money on owner-operator truck insurance?
- Who needs owner-operator truck insurance?
- What insurance coverage do truck owner operators need?
- Owner-operator truck insurance companies
How much does owner operator truck insurance cost?
Commercial truck insurance can be pricey. Costs can vary by thousands of dollars between two truckers with seemingly similar businesses. There are two categories of owner-operator insurances.
Some owner-operators lease their services to a motor carrier. Those truckers will need non-trucking liability, bobtail, and physical damage insurance. The cost of these policies depends mainly on the value of the truck and trailer and they cost around $4,000 a year.
The other category of owner-operators is those with their own authority. Truckers with their own authority can expect a wide range of premium costs. One person might expect an average annual premium of $10,000 annually, and another owner-operator might have a more than $2,000 increase over that.
Below are the average owner operator truck insurance costs for a semi truck in different scenarios:
| Truck owner operator types | Owner operator truck insurance cost |
| Owner operators that lease on to a motor carrier | $3,000-$5,000 a year |
| Owner operators that operate under their own authorities | $9,000-$12,000 a year |
| Owner operators with new authorities | $12,000-$16,000 a year |
The average costs above include all coverages an owner operator may need to operate their semi truck. Below are the average cost breakdown for each coverage:
| Coverage types | Average cost |
| Trucking primary liability coverage | $5,000-$7,000/year |
| Non-trucking liability coverage | $350-$400/year |
| Trucking general liability coverage | $500-$600/year |
| Occupational accident coverage | $1,600-$2,200/year |
| Trucking physical damage | $1,000-$3,000/year |
| Umbrella coverage | $500-$700/year |
These are just the averages. Your quotes and rates will be very different. Be sure to shop around with a few companies or work with a broker like Simply Business or Commercialinsurance.net or Smart Financial to compare several quotes to find the cheapest one for you.
How much is the average owner operator truck insurance cost per month?
Calculating from the annual cost above, owner operators that lease on to a motor carrier can expect to pay around $340 a month for their truck insurance. On the other hand, owners operators that drive on their own authorities should pay around $840 a month.
Owner operators with new authorities should pay around $1,170 a month for their truck insurance.
What factors affect owner operator truck insurance cost?
Several factors affect the cost of owner-operator truck insurance. Let’s look at some of them.
Lease or drive under your own authorities
As we learn above, commercial truck insurance cost varies significantly between owner operators who lease on to a motor carrier and those who drive under their own authorities.
Your driver demographics
Insurance companies assess risk based on various factors. One of them is the demographics of your drivers—age and experience, specifically. Drivers younger than 25 or older than 60 pose a significant risk on the road. However, insurance companies are more likely to insure an older driver in good health than a younger one who is inexperienced on the road.
Driving records
Accidents and moving violations are red flags to insurance providers. Those who have clean driving records typically receive lower insurance premiums.
Coverage history
Have you had insurance policies previously? Your payment history and your history of maintaining coverage will be investigated. If you’ve had any cancellations, the company will examine the reasons behind that. If there are issues in any of these areas, the company may decide not to write a policy for you, and if they do, your premiums will likely be higher.
How long you’ve been in operation
Insurance companies want to ensure that their risks are minimal. For that reason, they prefer working with experienced operations. New businesses are riskier than those with years of experience under the belt.
Where you drive
Do you drive in rural areas predominantly or through large cities? What are the typical road conditions along your route? What about the weather? These all can affect your insurance premiums.
Driver employment records
A long employment history equates to familiarity with routes and equipment. That familiarity means that the drivers should be experienced and, therefore, less risky for the insurance companies. The insurance companies tend to prefer if a driver has worked with multiple companies indicating a good amount of experience on the road.
Cargo
The kind of cargo you transport makes a difference in cost and coverage minimums. The value of your cargo also affects your rates. Your premium will be elevated if you consistently carry valuable or hazardous materials.
Safety features
If your truck has added safety features, it can reduce your insurance costs. Additionally, if you have safety training programs for your drivers, your insurance company could reduce your premiums.
Truck weight
A large or extra heavy truck may result in higher insurance premiums. Why? Because a larger or heavier truck is harder to maneuver in traffic and parking lots. These trucks are more likely to have an accident or carry dangerous cargo, leading to higher insurance rates.
State regulations
States set their own regulations regarding insurance. Those regulations factor into the cost of your premiums.
How to save money on owner operator truck insurance?
Now that you know what factors affect your insurance premiums, you’re probably wondering if there are ways to save money on those premiums. Luckily, there are some ways to save money when purchasing owner operator truck insurance.
Shop for the best rates and coverage
Comparing rates is one of the best ways to save on owner-operator truck insurance. When comparing rates, ensure that you are also comparing equal coverages. Don’t be afraid to shop for new coverages when it’s time for renewal if your policy is too expensive for you. The best way to compare rates is to work with a reputable broker like Simply Business, commercialinsurance.net, or CoverWallet and Smart Financial so that they can get quotes from several companies for you to compare.
Hire the best drivers
Your drivers are the heart and soul of your operation. Their driving records help to determine your rates. Ensure you know your drivers’ backgrounds and driving records, so there are no surprises when you purchase your insurance.
Safety protocols
Have safety protocols in place and hold training for all of your drivers. Safety standards are critical in the trucking industry, and insurance companies especially value safety. After all, they want to reduce the risk of claims being made.
Preventive maintenance
Ensure that you perform all preventive maintenance–oil changes, mechanical checks, and fluid levels adequately maintained. A well-maintained truck runs better. Those trucks are less likely to break down on the road and less likely to cause accidents.
Who needs owner operator truck insurance?
Owner operators who work under their own authority will need commercial truck insurance. Those coverages will need to include liability, physical damage, cargo, and general liability coverages.
Those who lease to a motor carrier will need to purchase bobtail, non-trucking liability, and physical damage insurance. Typically, the motor carrier will provide the other necessary coverages.
What insurance coverages do truck owner operators need?
Depending on whether you drive on your own authority or you lease on to a motor carrier, truck owner operators will need different types of trucking coverages.
Trucking primary liability insurance
If owner operators drive on their own authorities, they must have this coverage. State laws and trucking industry regulations will require you to get this coverage. This is the most important and the most expensive coverage that you must have to drive a truck. This covers bodily injury to other people and damage to other people’s property if you’re involved in an accident. It will also cover legal defense costs if you’re sued. If you are under lease to a motor carrier company, it’s likely they’ll get this coverage for you.
Non-trucking liability insurance
This insurance is necessary for accidents that occur while owners operators are driving their trucks during non-working hours. If owner operators drive their trucks during non-working hours and are involved in an accident, you must have this coverage to protect them. Owner operators need this coverage regardless if they drive on your own authorities or lease on to a motor carrier. Learn more at the best non-trucking liability insurance companies.
Bobtail insurance
Sometimes non-trucking liability insurance is also referred to as bobtail insurance. However, bobtail insurance only protects you if you drive a truck without a trailer attached to it. If you drive your truck during non-working hours and have a trailer attached to it, bobtail insurance will not cover you. Learn more at the best bobtail insurance companies.
Trucking physical damage insurance
This covers repairs or replacement of your trailer and truck when you’re involved in an accident. It also covers damage to your trailer and truck that results from natural disasters, like floods and earthquakes or theft. Lear more at the best trucking physical damage insurance companies.
Cargo coverage
This coverage pays if anything happens to the logs you haul while transporting them. It is usually required by the shippers or brokers. It is required more and more often nowadays. The price of cargo coverage in log truck insurance depends on the value of the logs. The more valuable the logs are, the more expensive the cargo insurance premiums are. Learn more at the best motor truck cargo insurance companies.
Uninsured motorist coverage
This coverage ensures that damages and injuries will be covered if you’re in an accident with an uninsured motorist or are involved in a hit and run. Given that almost 18% vehicles on the US streets are by drivers without insurance or underinsurance, it is critical for log truck companies to have this coverage. Actually, this coverage is required in most states.
Occupational accident coverage for truckers
Occupational accident coverage pays for medical expenses and lost wages if you get injured or become ill while driving a log truck. This is similar to workers comp insurance for truckers, but it is a lighter version. The coverage is not as comprehensive as workers comp insurance for truckers, thus it is usually just half of the price of workers comp insurance. Learn more at the best occupational accident insurance companies for truckers.
Workers comp insurance for truckers
If you run a log trucking company and hire drivers as full-time employees. You are required by law in all 50 states, except Texas to provide workers comp insurance for your drivers. However, if you hire your drivers as independent contractors, you are not required to provide workers comp insurance to them. You should at least provide occupational accident insurance to protect them. At the end of the day, trucking is a high-risk job.
If you are an owner operator who drive a log truck, you can choose to buy for yourselves workers comp insurance for occupational accident coverage.
Learn more at the best workers comp insurance for truckers.
Owner operator truck insurance companies
Various companies provide commercial insurance policies for owner-operators. Here are top 6 owner-operator truck insurance companies that we recommend. Compare your coverages and rates to decide which company has the best policy for you.
- Progressive: Best for discounted coverage
- Simply Business: Best for comparing quotes from multiple providers
- Sentry: Best for personalized service
- The Hartford: Best for owner operators looking for a sound and ethical insurer
- State Farm: Best for customer satisfaction and quick claims resolution
- Commercialinsurance.net: Best for a wide network of knowledgeable agents
Final thoughts
Owner-operators who work under their own authority should be particularly conscious of the insurance coverage they purchase. They need to carry more coverage than those who lease to a motor carrier because the motor carrier typically covers portions of the required insurance.
