Dry Van Insurance

Dry van insurance purpose and its need:

Why do you need dry van insurance?

Dry van insurance is a group of insurance policies that protect yourself, your truck, your employees, 3rd parties from unfortunate events, bad scenarios, and dangerous incidents.

Dry van insurance forms an umbrella of legal and financial protection around your trucking operation. 

Firstly the insurance protects from property damage. Secondly, it protects from bodily injury.

Thirdly it helps you to recover when your trailer or 3rd party trailer is damaged.

Fourthly insurance helps to protect you from cargo or freight loss.

Sixthly, Serious accidents causing bodily harm and injury to you, your drivers, and 3rd parties are covered by insurance. 

Seventhly, there is insurance for occupational accident insurance coverage and workers' compensation. 

Occupational accident insurance coverage and workers' compensation kick in when 

a work-related incident or accident happens.

These 2 insurance types pay your workers for bodily injury. It also pays for the loss of wages or salaries. It even pays for medical expenses and death benefits within the policy limit. 

Dry van insurance workings:

How does a dry van insurance work?

Dry van insurance provides insurance coverage within the insurance limits. Dry van insurance covers drivers and equipment. It also covers 3rd party from collision, bodily injury. It also covers drivers and owner operators for truck and cargo damage. 

Dry van insurance also covers tractor or equipment damage due to theft, vandalism, natural calamities, etc. 

In an incident that needs dry van insurance coverage occurs the insurance company pays coverage within the limits of the insurance policy.

Insurance requirements for dry van owners and owner operators:

What are the insurance requirements of dry van operator?

Businesses operating dry vans are subject to policy coverage and limits set by Federal Motor Carrier Safety Administration (FMCSA). FMCSA sets the minimum coverage for dry vans. This limit is set based on the weight, distance hauled and cargo type carried. The usually heavier truck will have higher insurance requirements and premiums. The dry van trucks carrying hazardous material will have larger coverages and high premiums.

The below list summarises the federal minimum insurance requirements based on the type of cargo being transported 

General liability’s coverage limit is $1 million yearly premium paid is $700 to $7000.

Trucking liability is 750,000 for interstate trucks and the yearly premium is $2,500 to $4,000 per tractor.

Nontrucking Liability has a coverage limit of 250,000, the yearly premium estimate is about $450 to $5,000 per tractor.

Bobtail insurance is has a coverage limit of $1000,000, the yearly premium estimate is about $350 to $450 per tractor.

Physical Damage the coverage depends on the actual and stated value of the equipment, and the premium would range from 2% to 5% of the value of the truck 

Motor Truck Cargo coverage limit ranges from $20,000 and $100,000 in different US states, the yearly premium estimate is $500 to $1000 dollars

Workers' Compensation depends on the cargo you are transporting, the yearly premium would be about $2500 

Dry Van insurance cost:

What is the cost of dry van insurance?

Yearly premium for dry van insurance  would be between $3000 to $100,00. The premium amount depends on various factor like:

  • Does your driver have clear driving records
  • The load types you are carrying 
  • Value of the trailer or equipment
  • The radius of your operation 
  • Coverage of your policy
  • Limits of your policy
  • Deductible you need to pay
  • Your credit history 
  • Your payment plan

If you are looking for a low premium policy, you can compare and contrast policy on the internet using CoverWallet. You can also look for low limit, high deductible and minimum coverage policy from your insurance agent. 

Taking the low limit and high deductible policy will get you in trouble if a serious accident or issue crops up in your dry van trucking business. This problem will force you to pay deducticible from your pocket to cover the losses incurred to the business due to the incident. 

Insurance premiums are a very large overhead for a dry van trucking business. You as a fleet owner or owner operators need to find a company who provides a good coverage with  low premiums and reasonable deductibles, 

Factors that affect the cost of dry van Insurance policies:

What affects dry van insurance costs?

Cheap insurance is not always the best insurance, you need to take insurance that covers you for multiple adverse scenarios. The cost of insurance for a owner operators or drivers depends on how insurance companies weigh various factors like:

Factors that affect the insurance premiums:

  • Ownership status 
  • Cargo types
  • Freight weights 
  • The distance the load is hauled
  • Truck value
  • Type of physical damage
  • Driver or owner’s credit history 
  • Loss history
  • CDL and trucking experience 
  • Deductible amount 
  • Coverage limits 

Finding cheap dry van insurance:

How to find a cheap dry van insurance?

Finding a cheap insurance is a tough proposition, but you can use various techniques to find affordable insurance. You need to know longer your haul distance is bigger your premium is. Then heavier your load is bigger your insurance premium. Also if you are hauling hazardous or harmful cargo your insurances rates will be higher.

Also you need to understand that a new MC owner operator will be billed a larger premium compared to experience CDL drivers. If you have a clean driving record you will get a lower net cost on insurance.

These are factors that you should consider to get a affordable dry van insurance:

  • Compare and contrast quotes from several insurance companies
  • Ask for discounts
  • Pay your whole premium upfront
  • Get the right coverages
  • Increase your deductibles if you are prepared to pay it, while you encounter an incident
  • Always be on the hunt for new insurance

Dry van insurance protects your business:

How does a dry van insurance protect your business?

The insurance you pick for your dry van business depends on your status that is whether you are a leased owner operator or an independent owner-operator. 

In case of a leased owner-operator many of their insurance requirements are fulfilled by their owners or carrier companies.

Most common types of truck insurance, what it covers, who need it:

General liability: This insurance coverage is for 3rd party property damage and bodily harm caused by your driver or equipment. This insurance is for drivers with authority and motor carriers.

Primary trucking liability: This insurance covers property damage and bodily harm or physical injury to drivers due to a trucking incident. This is for drivers with authority and motor carriers. 

Non trucking liability: This insurance covers 3rd party damages when the truck is used for non trucking business purposes. This insurance is for drivers under lease 

Bobtail insurance: This insurance covers your truck for damages to your truck due to collision, theft, natural disaster and vandalism. This insurance is for drivers under lease

Physical damage coverage: This insurance covers the damage occurring to your cargo that is being transported. Owner-operators and fleet owners should take this insurance. 

Motor truck cargo insurance: This insurance covers the damage occurring to the shipment or cargo or freight due to fire. Collision and striking of a load. This insurance is for carriers who need to insure cargo or freight.

Workers' compensation coverage: This insurance helps to cover employees getting ill or injured while at work. Worker’s compensation help employees recoup their wages or salaries or get medical bills paid after a work-related accident or incident happens.

This insurance is for all trucking operations with employees.

Other insurance coverages dry van owners or drivers should consider for extended converge is:

Occupational Accident Insurance Coverage (OAIC): 

OAIC provides certain amount of coverage to employers and employees in case of a job-related injury. OAIC covers lost wages and salaries, medical expenses, and death benefit up to the policy limit. The trucking business can choose their deductible limit and the disability coverage they want to buy.

Trailer Interchange Endorsement:

This insurance provides physical damage protection for  3rd party trailers pulled by your equipment.  Trailer interchange endorsement protects you if the trailer are damaged by fire, theft, vandalism, collision or explosion, etc.

Hazmat Truck Insurance: 

As per the type of hazardous materials hauled, hazmat trucks are mandated by law to provide insurance liability from $1,000,000 to $5,000,000 per accident.

Trucking Umbrella Insurance:

As a dry van owner operator or owner, you might have certain uncovered exposures. Umbrella insurance can help you cover those gaps and increase your liability.

Some umbrella policies exclude key risks, you need to read the contract to find out what it excludes. 

Uninsured & Underinsured Coverage:

Uninsured motorist insurance protects the 3rd party if they are in an accident with an at-fault driver who doesn't carry liability insurance. 

Underinsured motorist coverage steps in when you're in an accident with an at-fault driver whose liability limits are too low to cover the medical expenses of any injured people.

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