A number of companies have made it their business to provide trucking services to a large array of industries. The transport of goods often involves interstate trucking or intrastate transportation, and these states may require you to produce a certificate of insurance documenting the type of insurance coverage you have on your commercial vehicles.
Although a certificate of insurance is not legally considered proof of insurance, companies that make use of commercial vehicles often require this document. When your truck crosses state lines it must adhere to the rules and regulations of that state. If you happen to be involved in an accident, you will need coverage, which is available through interstate trucking cargo insurance programs and can provide you with the funds necessary to repair your damaged vehicle.
Why is insurance for trucks required?
In interstate trucking, a certificate of insurance is required because of the potential for large losses if a driver or business owner is held legally liable for an accident. Because of the size of your vehicle, and the potentially valuable cargo you may be carrying, accidents involving your commercial vehicle tend to have higher costs than those involving a personal car or truck.
For a company that owns a large fleet of vehicles, and company’s requiring broader forms, a policy can be issued on any vehicle where no schedule changes are needed. This type of policy insures you for the use of owned, non-owned, hired vehicles, subcontracted vehicles and even for the use of private passenger type vehicles.
These policies can be written on a gross revenue or mileage premium rating method. In most cases, selecting these options simplifies your coverage and can help reduce your overall cost. Coverage is generally rated and can be applied to you on a scheduled vehicle basis. This means that if the vehicle is not on the schedule then there is no coverage provided.
For companies owning only a few vehicles this is generally not a concern. The problem may become more significant when there is a large fleet and/or many vehicles added during the policy year. Care must be exercised and excellent communications with your broker should be established to ensure that interstate trucking cargo insurance programs chosen by you are working to your benefit and you always have the coverage necessary to protect your fleet.