Most drivers take to online in search of cheap auto insurance. However, if you run a truck for a living, more specifically a dump truck, then you would be looking for low cost dump truck insurance in California.
Regardless if you live in Los Angeles CA, or San Bernardino CA commercial insurance is a necessity. It’s a part of your resume, without it, you can’t go to work.
Special Regulations for Dump Trucks
Many regulations and guidelines apply to your industry if you drive dump trucks, or any type of commercial vehicle for that matter. However, since dump vehicles are in a league of their own, we will start the discussion there.
Understanding these regulations can save you money on your dump truck insurance.
Special Regulations apply to a dump truck insurance policy, and all commercial policies depending on your job description and driving radius.
Dump trucks are classified under the heavy commercial vehicle category and thus require special considerations compare to its light and medium commercial auto vehicle counterparts.
Dump truck coverage and other large commercial policies are regulated under the Commercial Carrier Regulations, which we will examine in the below paragraphs to make sure you are being covered properly for your specific niche before comparing online quotes.
Dump Truck Insurance – Carrier Regulations
The Commercial Carrier Regulations apply to commercial carriers of both passengers and cargo because of the risk of common carrier accidents.
In order to protect the interest of the general public, the state and federal government created laws that have a minimum financial responsibility requirement for all commercial carriers.
These requirements may be met either by purchasing insurance or obtaining a surety bond, guaranteeing payment in the amount that is at least equal to the minimum limits.
In some cases, full or partial self coverage may be accepted, normally this can occur if the carrier proves the necessary financial date to support the ability to fully or partially self insure.
Federal rules for common carriers were established by the Motor Carrier Act of 1980, which took effect in 1981 and has since been amended to increase the financial responsibility limits required in the United States.
The Department of Transportation is responsible for the enforcement of these requirements since it falls under their jurisdiction.
The actual act requires minimum liability coverage for carriers of certain hazardous substances.
In addition to the direct injury and damage that can be caused by a collision involving a commercial carrier, hazardous substances pose a special threat unlike any other material or substance.
Some substances can carry a special risk of fire and explosion, while others may release poisonous gases, which may endanger people and pollute the environment as an effect.
Many of the substance which pose no immediate short-term risk to humans might still carry a long-term risk to the environment.
Liability regulations serve two purposes; first, they provide some degree of protection to the public by providing funds for the actual damage claims.
Second, the existence of the requirements create financial incentives and serves as a reminder to common carriers to follow safety standards.
The federal law requires a single limit of liability that will apply to all payments for bodily injuries, property damage and environmental restoration resulting from negligence in the maintenance, operation or use of motor vehicles subject to the act.
It is not necessary for the type of motor vehicle “accident” we normally think of to occur for liability to be imposed. “Negligence” could result from failure to close a valve, resulting in leakage of fluids or gases.
The required coverage is designed to pay for “public liability” — it does not apply to injuries to the carrier’s employees or loss of the cargo being carried.
Coverage is usually obtained by attaching an endorsement to a policy providing commercial auto or truckers coverage. The endorsement has been developed by the Department of Transportation, and not all insurance carriers are willing to provide it.
Commercial coverage forms exclude nearly all forms of pollution, and when insurers are unwilling to write the “environment restoration” coverage the commercial carrier will have to look to other markets.
Some states have a commercial automobile assigned risk pool, which may provide the coverage. Residual market mechanisms and the surplus lines market may have to be explored in order to obtain coverage.
The required limits vary by size of the vehicle and the type of commodity being carried. Material that are classified by listings under Title 49 of the Code of Federal Regulations.
Commercial Auto Insurance Coverage – minimum liability requirements are:
- $750,000 for the transportation of non hazardous property
- $1 million for the transportation of il listed in 49 CFR 172.101
- $5 million for the transportation of hazardous substances as defined in 49 CFR
If you have a dump truck business and have a “Fleet,” meaning multiple dump trucks and all listed on one commercial insurance package instead of buying separate individual polices for each dump truck.
This can mean huge savings, especially if you package it all in with General Liability, Workers Compensation and so forth.
Not all the Same
Remember that not all providers have access to a market that can package everything into a single policy, which is why it is imperative when shopping for coverage in California, is to always ask if direct access to the commercial carrier is available.
Also check to see if they can package everything onto one policy, or have an option to add multiple vehicles to one policy without any caps or restrictions.
Remember, firms can be exposed to a wide variety of hazards depending on the nature of their hauling operations, radius of travel, type of commodities hauled, and extent of warehousing or other incidental operations in which they are involved.
The following exposures to loss are of particular concern to underwriters when evaluating accounts.
Motor Carrier Act
The motor Carrier Act of 1980 has had a proud effect on the competitive situation for most regulated carriers. There is now a more aggressive environment which makes it more difficult for motor carriers to maintain profit margins.
Additionally, companies that insure regulated carriers must file MCS-90 forms which hold them to absolute liability regardless of whether the trucker has the ability to reimburse them in case of an uninsured loss.
Consequently, most underwriters will want to closely review the past record of the trucks financial statements when submitting to ensure coverage. The account has to look financially sound to the underwriter.
Conduct of Business
Usually a firm conducts business can be another major consideration for carriers.
Underwriters will want to know the extent that a company uses leased, rented or borrowed vehicles. They will also want to review the relationships drivers have to the trucking company.
As an example, may companies will lease out some or all of their driving duties to independent owner operators on either a per trip on a long-term basis.
In these cases, procedures requiring proof of insurance form owner operators should be in place when such drivers are responsible for their own coverage.
Some operations can be labeled as high hazard operations. These operations may disqualify them from many insurance programs. Most underwriters will want a detailed description of the types of hauling done as well as all incidental operations they may engage in.
Commonly excluded activities include long haul trucking exposures.
The extensive back hauling of unknown commodities, transportation of garbage, waster materials or build commodities, such as sand, gravel, etc.
Reason for Most Common Loss
Probably the number one cause of trucking losses results from driver error. Consequently, most underwriters will require that an established driver qualification program be in place for all drivers who operate company vehicles.
Such a program may vary depending on the scope of operations, but will generally involve a number of steps designed to ensure careful driver selection, trailing, and on going supervision.
For instance, requirements might include license checks along with written and road tests from all new drivers, motor vehicle record checks on an annual basis for current drivers, and compliance with all applicable DOT., ICC and state agency regulations.
Compliance may necessitate physical exams, accident reporting, during testing of drivers,or other government mandated actions.
Major Cause of Claims
Another major cause of claims results from improperly maintained vehicles.
All companies require that firms establish a vehicle maintenance program that includes written service and repair records, out of service standards, regular vehicle inspections including driver checks prior to and after each trip.
Also mandatory replacement schedules for both equipment and vehicles.
Nature of Commodities
The nature of the commodities hauled by drivers are another factor that will be reviewed by an insurance underwriter.
Cargo often targets as high hazard includes, designated hazardous cargo or explosive, flammable cargo. In addition, high valued, fragile, or perishable cargo as well as gaseous or explosive cargo would fall under this tier.
Theft is the major cause of loss to cargo. The two major factors that determine the severity of this exposure are the type of commodity and the area of operations.
Since insurance companies cannot change these variables, most will take a close look at specific theft prevention methods used by an insured to protect shipments.
This might include use of truck or warehouse alarms, hiring of guard services, use of convoys or accompany vehicles for high target cargo, use of loose pick up tucks for local deliveries, and the use of fencing and lighting at terminal areas.
All firms maintain and use a variety of flammable substances including gasoline, solvents, paints, and thinners. Underwriters will closely review the usage and storage procedures used in conjunction with these items.
High hazard repair operations such as welding, battery storage and or recharge, parts cleaning, and spray painting require that trucking firms follow all National Fire Protection Association guidelines for such activities.
Public access to shipping and receiving areas can lead to slip and fall related claims.
This can be especially relevant for truckers who maintain warehousing operations. Underwriters will want to review those procedures that are used to keep all public access areas free of oils, snow, ice and debris.
Transit Companies that store gasoline or other petroleum produces in underground tanks are subject to a number of additional federal, state, and local regulations.
Truckers who engage in vehicle repair work resulting in the disposal of hazardous waste materials are subject to the Toxic Substance Control Act.
Underwriters will closely review all pollution related exposures even when the garage or liability policy contains an absolute pollution exclusion.
Terminal operations where large numbers of vehicles are parked can present a catastrophic loss potential. Vehicle thefts and vandalism can be common in high crime urban areas.
Severe wind damage, flood or fire loss can occur whenever large numbers of vehicles are present. Underwriters will review closely all procedures and methods used to reduce these loss exposures.
Warehouse operation require the same fire protection considerations as any large property structure. Underwriters will closely review the age, construction and updating of all building along with the extent of private and public fire protection available.
Housekeeping in storage areas and merchandise stacking procedures will also be a primary concern for warehouse operations.
Moving and Storing Operations
Moving and storage operations will be closely reviewed as to the quality control program utilized for packing, delivery and installation work.
Most underwriters will want to make sure that such work is checked and approved by knowledgeable supervisory or to the experience personnel. Maintain records of such work including any customer complaints and actions taken are a plus.
Freight forwarders or specialized haulers may engage in consulting services and could be prone to confessional liability exposures. Most underwriters will take a very close look at these operations.
Cash Handling Process
Cash handling procedures may also be reviewed. Such controls can vary but could include the use of pre number purchase orders, invoices, warehouse receipts, and bills of lading.
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If you should need help comparing cheap dump truck insurance in California, regardless if you live in Orange County CA, or Long Beach CA?
We are here to help, contact a license commercial coverage specialist or find the cheapest automobile insurance or commercial dump truck insurance in California at 800-962-0085!
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