Cargo Truck Insurance

motor truck insurance


What is motor truck cargo insurance?  Common question, simple answer. No matter if you truck in Los Angeles or Orange County CA.

Commercial cargo insurance is protection carried by truckers while transporting their loads.

In the transportation industry, the trucker is deemed responsible for cargo as soon as it enters his possession. So, no matter if you’re hauling perishables or cars, this protection would ensure your cargo is protected.

The insurance provides coverage in the event the freight is damaged or lost while in transit.

Coverage is available to common carriers who are available for hire by the general public, and contract carriers, who haul cargo under terms of a contract that is engaged with a specific entity.


Cargo Truck Insurance Required

Without this protection, a common carrier would be liable for any damages to the cargo being hauled except for incidents involving an act of God.

Below are a few items as an example:

  • a tornado or hurricane;
  • public enemy, such as an act of war;
  • fault of the shipper, such as improper loading of the truck;
  • inherent vice, including damages from extreme weather conditions or product spoilage;
  • or public authority, such as when police confiscate the cargo believed to be suspicious.


Contact Carrier

With a contact carrier, conditions of liability are specified in the contract. So, the simple answer to the question is yes, especially if you are under contract.

Even before you are able to pick up a load, you will be required to show proof that you have the required cargo limits.

These requirements can vary depending on the type of shipment and the value of the load.


Insurance Policy Checklist

We always recommend that before you begin your search for cargo coverage, to make a checklist.

These items will streamline your quoting process.

You will be comparing apples for apples instead of guessing on what coverage you are required to drive with.

When your broker or agent ask for certain coverage requirements, you will have them all at hand.




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Required Coverage

The first task to begin with is the required coverage.

If you are an independent trucker, maker sure to collect your contracts required coverage amounts.

Normally, if coverage is required, you will find it on this sheet.

It will also include the liability requirement to uphold while contracted through the trucking organization.


Step Two

Step two, if you have been through this process already and have an active policy, collect it, and have it close by in case you need to gather more information.

If you are working with a broker, make sure to let them know what  company you are currently insured with so, they don’t send your application to them for rates.

It saves you time in the long run, less paperwork to process on the insurance brokers side, means a quicker turn around.


Local Agent & Brokers

Unfortunately, not all commercial brokers have direct access to commercial auto companies.

This means 1-2 week quoting delays as you may have already experienced.

Also, the rates that are not always guaranteed, since not all of them run your driving record until after your ready to purchase.


Step Three

Step three and most important when shopping and comparing quotes, standalone or bundled.

Some trucking companies can offer a standalone policy, meaning if you only need the coverage.

This is because your covered elsewhere with the liability and full coverage, than this option will work great for you.




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Bundle Policy Coverage

However, if you are looking to save the most on your total premium, it is always a good idea to bundle everything into one commercial coverage package.

The discounts of the bundling oversea any discounts offered by a standalone cargo insurance policy.

In most standard liability commercial automobile policies, the cargo insurance is the most costly portion of the policy.

By including cargo coverage into a package you avoid the costly rates of a standalone.

It is especially important to ask if you are buying only the cargo portion if the company you are being placed with can add other coverage later on in the policy term.

As mentioned above, not all companies will offer this coverage.


Endorsement Options

Acts of God Perils Endorsement is available.

This is because most forms are legal liability policies, flood, earthquake, windstorm and other Acts of God are often not covered.

This endorsement is used to provide coverage for one or more of these perils on a non legal liability basis for an additional premium.


Breakage Coverage Endorsement

This type of endorsement is often attached to the motor truck cargo policy of truckers who haul fragile commodities.

This can include food products such as eggs or bottled beverages as well as breakable durable goods.

Many policies automatically include breakage limitation provision in which loss resulting from breakage is limited to a percentage of the loss, such as 50% or as a maximum amount per loss.


Broadened Definition of In Transits

Common question that is referred to the provision found in a motor truck cargo legal liability form.

This form includes coverage for the temporary interruption of movement of cargo. Examples are such as temporary storage at a terminal, break bulk facility or warehouse.

This is necessary since under the defined definition of many policies, coverage is provided only while a shipment is actually being transported.


Collision of Load Coverage Endorsement

This type of endorsement is used to extend a cargo policy.

It is to provide coverage for loss resulting from a truck’s load hitting another object, other than by impact of the truck itself.

This can be especially important for carriers who provide shipping with open trailers or oversize loads.




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Debris Removal Costs Coverage Endorsement

This type of endorsement use to extend a cargo policy to include a specific sub-limit amount for removal of debris.

This is included damaged cargo when loss results from a covered peril

This might be considered as a type of pollution related coverage that can have importance from many types.


Earned Freight Coverage Endorsement

This type of endorsement often is attached to a motor truck cargo policy to provide reimbursement for payments of earned freight charges rendered noncollectable due to the refusal of consignees to accept shipments.

This is because they have been lost or damaged by a covered peril under the policy.

Please not that such endorsement usually only apply to collected freight charges.

This will not apply to prepaid charges of these costs are normally included on the invoice and would therefore be included in the adjustment of any covered claim.


Excess Coverage 

As a trucker, you may on occasion need additional coverage in excess of the basic policy limits.

This endorsement allows for this eventuality by allowing for an additional specified amount to be provided for a single load as long as the excess values are reported to the insuring carrier prior to the actual haul.

An additional premium charge is then assessed based on the excess values that are actually used in conjunction with the haul.

Take note however, that this type of endorsement can also be used together than that specified in the policy declarations is to be transported.




California Insurance Coverage

As you can see, it is in your best interest to be proactive when finding cheaper coverage.

If you are new to the trucking industry and need some basic insurance tips, start with the above 3 steps.

With over 30 years experience with truckers, one our licensed agents can answer any questions you may have.

We understand the insurance part is something you shouldn’t be consumed with, you’re a trucker and you belong on the road not behind a computer, that is our job!

Let us help you with your commercial cargo insurance quotes or bundle car insurance Los Angeles CA.


Service Areas: Los Angeles, Ontario, Long Beach, Fullerton, Riverside, San Bernardino, Orange, Victorville.



Cargo Truck Insurance
  • Elvis Simon