Being your own boss as an independent owner-operator can be rewarding. Accepting jobs on your terms and managing your own time and resources can lead to significant opportunities and a higher level of satisfaction than working for others.
To avoid the pitfalls of owning your own business, you, as an independent trucker, must understand each element of operating the business. Managing expenses will include controlling the costs of financing, professional fees, payroll taxes, licensing, maintenance, telephone, office supplies, health and semi truck insurance, and the real expense of operating your equipment.
Semi truck insurance coverage to protect you and your rig from unforeseen injury, damage, or liability is a vital part of the overall expense calculation. Having appropriate insurance coverage can protect you and your business from financial disaster.
Purchasing the Right Independent Semi Truck Insurance
Semi truck insurance premiums seem like just another annoying and repetitive expenditures until the moment you need it. Currently, the minimum amount of coverage for a single truck is $750,000, although $1 million is standard.
As with any insurance, you should shop around for the best blend of competitive prices and quality service from reputable semi truck insurance companies. Premium rates can vary substantially, and a few thousand dollar increase in semi truck insurance premiums each year can certainly impact one’s ability to keep the business afloat during slow months.
Here are some factors that will impact your rate quote:
CDL Experience: How long you have been operating similar equipment. Is your Motor Vehicle Record (MVR) clean?
SAFER Score: Since 2014, the FMCSA has centralized driving records into a single audit database known as SAFER (Safety and Fitness Electronic Records). The scoring includes:
- Driving record
- Accident indications
- HOS Compliance
- Vehicle maintenance issues
- Controlled substance violations
- Driver capabilities and training
Low SAFER scores can label you as an unacceptable risk and result in rejection or very high semi truck insurance premiums and deductible.
Logbook Violations: Have you had many logbook violations during your previous trucking life?
Credit Score: Try to improve your credit score before applying — companies base rates on their expectation that you will pay the premiums promptly.Fog Lamps or Deer Guards: These accessories reduce the potential for severe accidents and are viewed positively by insurance companies.
Deductible: Do you have the financial wherewithal to manage a higher deductible? Raising the deductible can reduce your premium by a sizeable margin. Remember, however, the higher deductible can cause a severe one-time blow to your business’s cash flow in case of a severe accident.
What You Carry: The loads you will be carrying can affect your premium also. Premiums for carrying lumber, steel or refrigerated goods will be less than for hauling fuels or hazmat materials.
Applying for Owner-Operator Semi Truck Insurance
Know where you stand with your SAFER Score and credit rating before applying. If there are discrepancies that you may challenge, do so before contacting an insurer. Be prepared to demonstrate that you have corrected some of those shortcomings and are not likely to repeat them.
But, if your driving record is not spotless, consider working with a licensed broker who can offer creative solutions to helping you meet or exceed regulation minimums on semi truck insurance with flexible premium payment options.
Comply with The Law
Once you secure affordable semi truck insurance coverage, continue to operate your business safely and legally. Be realistic with deadlines and do not overpromise on delivery times that may cause you to rush or drive beyond legal hours. Be mindful of your speed and do not exceed your hours for the day on your ELD. Following these guidelines will help you secure and maintain lower rates on quality trucking insurance.