Posted on 11 Nov, 2014
Categories: Trucking Business
By now you’ve probably heard that the FMCSA is looking into raising the minimum amount of insurance that carriers are required to have on their trucks. An Advanced Notice of Proposed Rulemaking was filed last month, with the FMCSA claiming that the current minimums of $750,000 for general freight and $1 million for hazardous materials were too low, but they haven’t made a decision on what the new minimum might be.
While we’ve seen the playing field level a bit this year for small carriers and owner-operators, those businesses would be the ones hit hardest by raising the minimum. The mega-carriers that support the increase – like the seven in the Trucking Alliance, a group lobbying to pass the law – are often self-insured and meet the minimum requirements by posting bonds, with letters of credit, or with some other financial means.
For small carriers, raising the minimum would most likely mean higher insurance premiums. The current minimums of $750,000 for general freight and $1 million for hazardous materials have been in place since 1985. The FMCSA says that the general freight minimum would be $1.6 million today had it kept up with inflation, but they also found that crash settlements exceeding the current minimums are rare.
Getloaded members: How much do you pay for the insurance policy on your trucks? Are you insured at or above the current minimum? Let us know in the comments.
Photo from Wikimedia Commons