So you or someone you know is probably wondering… “Why is Trucking Insurance so expensive? How can I get my insurance rate reduced? This is madness!”

Don’t worry… you are not alone. A lot of owner operators and carriers that are newer to the Trucking Industry or even have tremendous experience think that the cost of insurance is overpriced. The truth is that the cost of insurance is often times not cheap – especially when it is for use. A lot of people and even some of us thought at a point that the insurance companies are price GOUGING! In fact most of them are having a hard time making sure they are even operating at a profit as crazy as it sounds. A visible key indicator that this statement is true is the amount of insurance companies that are even willing to be involved in Commercial Trucking operations.

Trucking Insurance Market Overview

There are over 2,500+ Insurance Companies that have the ability to write Commercial Trucking yet there are only about 40 of them that are actually writing Trucking business and out of those 40 companies there’s really only about 20 of them that are still writing new business. If writing Trucking Insurance was such a money maker than the marketplace would see a flood of insurance companies flocking to write Trucking business which in return would lower the insurance costs for the buyer; but what you are currently seeing is the opposite type of economics. The buyer of insurance can see this constraint in the marketplace first hand. Depending on the circumstances of a specific Trucking operation, a company or operator might only be eligible for insurance with 1/5 of those 40 insurance companies and in some cases its more like 1/20.

Why is it so expensive?

There are multiple factors that have led to the increase of commercial auto rates, including but not limited to: unfavorable state laws (Michigan is an example of this with their PIP laws:, increasing litigation costs, suit incentives for the plaintiffs bar, growth in the economy after the recession, technology increasing distracted driving, a shortage of qualified commercial drivers, underwriting unprofitability or at too low of premiums (As crazy as that sounds), and various other reasons. As a side note; not all lawsuits from Trucking accidents are frivolous by any means. Many of the suits need to be taken seriously when someone is actually injured. With that being said, our current legal system thrives off of people looking for a quick pay day.

How do we lower insurance rates?

The best thing a company or an operator can do to lower their insurance rates is be the exception within the industry. To get preferred rates means that you need to be a preferred risk and eliminate any risk or “hairiness” from your company anywhere possible. Here’s a list of a few positive and negative attributes that can either help your operation or make it stand out like a sore thumb.

Positive Attributes:
– Multiple years in business
– Quality driver(s) (Experienced and they have great driving records)
– Equipment is newer (Older equipment tends to have malfunctions)
– Written safety procedures for drivers
– Driver incentives for safe driving
– Claims are infrequent
– Claims are being reported (Underwriters can see when accidents happen even if its not on a loss run report)
– Operation description does not vary drastically
– DOT inspection results are good/great (This is a huge indicator to the insurance underwriters whether an operation is being safe or is flying by night)
– No vehicle or driver discrepancies (All drivers and vehicles are reported and scheduled immediately)
– Good payment history
– Good insurance tenure history
**Simply put, if all the ducks line up in a row then an operation is considered a preferred risk**

Negative Attributes:
– New business operation
– Inexperienced driver(s)
– Poor driver records (Accidents, violations, and even non-moving violations are not preferred)
– Equipment is older
– Poor payment / Cancellation history
– Claim frequency
– Claims are unreported
– Operation description changes frequently
– DOT inspections are poor
– Unreported drivers and vehicles

Here’s a short example of what a preferred and a substandard risks insurance might look like:


State: TX
Equipment: 5 Trucks : 5 Trailers
Description of Operation:
  • Hauling heavy equipment for Caterpillar and nearby farming companies. Primary radius is within 300 miles.
  • All drivers were between the age of 30 and 65 years old with more than 10 years of Class A CDL experience each and they have no accidents or violations within the last 3 years.
  • 14 Years In Business
  • Insured has had a claim on the prior Physical Damage policy for $25,853, the Auto Liability policy for $12,037, and the Motor Truck Cargo policy for $42,000.

$1,000,000 – Auto Liability
$1,000,000 / $2,000,000 – General Liability
$250,000 – Motor Truck Cargo
$250,000 – Excess Motor Truck Cargo
$430,000 – Physical Damage
Total Premium: $62,197/Year


State: TX
Equipment: 5 Trucks : 5 Trailers
Description of Operation:
  • Hauling heavy equipment, building materials, concrete, steel, pipes, dry goods, produce, beverages, paper, plastic, cold food, meat, dairy, and canned goods.
  • All drivers are between the age of 23 and 72 years old with more than 1 years of Class A CDL experience. Drivers do have violation and accidents on record.
  • 2 Years In Business
  • Insured has had a 6 claims in 2 years. On Physical Damage policy for $22,870, the Auto Liability policy for $47,025, and the Motor Truck Cargo policy for $8,100.
$1,000,000 – Auto Liability
$1,000,000 / $2,000,000 – General Liability
$100,000 – Motor Truck Cargo w/ Reefer
$150,000 – Excess Motor Truck Cargo
$270,000 – Physical Damage
Total Premium: $127,325/Year

What can we do as a Trucking operation?

As an owner operator in a fleet of 5 units or as an owner of fleet of 100+ units the mission statement through the company has to be somehwat along the lines of: ‘Make as much money as we possibly can, help the economy through our Transportation services, and simultaneously keep integrity and safety as a top priority’. Do everything you possibly can to operate safely because the Trucking industry is relying on all companies to get on the same track to get the overall insurance costs down.

As an insurance agency that works with Trucking companies everyday we understand the cost associated with operating a Trucking business and we want to help on the insurance side as much as we possibly can! Our mission is to help Trucking operators and companies make sure that their operation is fitting into the insurance underwriters box so our customers in return get the best insurance premiums. We continue to provide the best possible service to our customers and we constantly stay updated on Trucking Insurance markets and trends so our customers are the first to be taken care of with the best coverages and premiums.

We hope this article may have helped your operation in one way or another and we hope to hear from you soon!