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A Guide To Important Information About Your Commercial Truck Insurance As A Self-Employed Trucker

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If you are the new owner of a semi and you plan to have years of lucrative contracts with a variety of businesses, it is crucial for you to be adequately insured against theft, loss, and damage. It is often surprising to learn that you will need to have two different types of insurance on your vehicle and its contents and that a third option is likely to be helpful as well. One will protect your vehicle and its contents, up to a certain amount, and that insurance is known as your primary cargo coverage. The second insurance you should plan for is your contingent cargo coverage, which provides protection when the items that are missing, damaged, or undelivered exceed the amount covered by your primary cargo policy. A third policy you are likely to find beneficial is warehouse insurance, which provides financial protection against theft, loss, and damage to any merchandise left in a warehouse prior to your pickup and after your drop off there. A further explanation of each option is found below.

Understanding Your Primary Cargo Insurance

Primary cargo insurance is crucial for a trucker because it provides the basic coverage that you need to protect both the items you are transporting and your own liability if you were unable to deliver all or some of those items in full and on time. Without this insurance, you would be responsible for the contents of your truck, and you could easily lose customers or even be sued by the companies with whom you are working if there was a problem with the contents of the delivery.

As mentioned, you will find that this is a basic policy. As such, it has numerous exclusions that could still cause a problem later on. For instance, you may find that your policy only covers the items in question while they are under your immediate control. That means that before or after your pickup, those items would not be covered and that could be an expensive issue. In addition, it is also likely to cover up to a certain dollar amount, often per pound, of your delivery. That would be fine if you are only delivering bananas and paper towels, but furniture, electronics, and other items will quickly exceed that coverage. As a result, you will need additional coverage, as described below.

Planning For Contingent Cargo Coverage

Contingent cargo insurance will typically assume financial responsibility when the primary cargo policy declines coverage or when the dollar amount of loss is greater than the policy. However, you should be sure to closely check the details of this policy, as it is becoming more common to have multiple exclusions on this type of coverage.

For instance, the policy itself could be very similar to your primary coverage and would therefore only be useful to you in the event that the first policy was invalid or turned down for some other reason. Alternatively, you may also find that the increased dollar amount for the goods you are transporting is a more appropriate choice for your needs. As an owner-operator of your own vehicle, you will also find that your coverage will cover the medical expenses of other parties if it is determined that you caused a motor vehicle accident.

Regardless, it is best to ask questions, to understand the terminology and details, or even to have your attorney look at the policy to verify that you have adequate protection in the event of a significant loss.

The Necessity Of A Warehouse Policy

As a trucker, there is a good possibility that sometimes when you pick up or deliver items, you will be asked to do so from a warehouse. Unfortunately, the policies listed above will frequently exclude coverage for any merchandise not under your direct control at the time of loss or damage. That could potentially be a challenging situation, as the owners of that property may assume that before they unload it or you pick it up, it is not their responsibility.

In that instance, it is best to have a policy covering all warehoused goods. If items are lost, damaged, or stolen, the owners have financial coverage and you will not bear that burden.

In conclusion, as a new owner or operator of a semi truck, adequate insurance is crucial to protect you from enormous losses in the event of theft, loss, damage, or delay. Therefore, while considering your insurance choices for your truck, it will be very helpful to be aware of the information provided above.