Requirements to renew your commercial truck insurance

August 8, 2023 Commercial Truck Insurance

When you decide to start a trucking business, having commercial truck insurance becomes a mandatory requirement. This insurance ensures your ability to operate safely and legally. Commercial truck insurance needs to be renewed annually, and this process involves meeting various renewal requirements.


Below, we will provide you with detailed information about the requirements for renewing your commercial insurance. We’ll also discuss the recommended time to begin your renewal process without disrupting your company’s operations, along with financing options available for renewing your commercial insurance.


Renewal requirements


The insurance agency advising your trucking company with commercial insurance must have the information and documentation to renew the commercial insurance to make the renewing process agile and accessible.


Therefore, you must take into account the following requirements for your renewal:


  • Ensuring Up-to-Date Company Information: It’s crucial to provide current and accurate information about your business. This includes details about the types of trucks and commodities you transport, any changes to your company’s address, modifications to your truck company, or additions of new vehicles as your company grows. Additionally, ensure you update the names and licenses of new drivers, as well as your operating radius.


  • Updated Loss Runs: Your insurance company will review your loss history to assess risk. This evaluation helps determine whether policy renewal is appropriate or whether adjustments or upgrades are needed to enhance coverage.


  • Motor Vehicle Registration (MVR): Your Motor Vehicle Registration supplies vital data for risk assessment, fee determination, and compliance with legal requirements.


Ensuring clear understanding and full compliance with requirements is essential for the seamless operation of your transport company. To ensure your success, we will now delve into the key aspects that demand your careful attention.


Primary Types of Trucks and Transported Commodities


In the following section, we will provide you with common examples of the types of goods transported by various kinds of trucks. Please note that specific freight requirements can vary based on factors like region, industry, and season of year. Transport and logistics operators typically choose their trucking partners after reviewing their insurance certificates and ensuring that the equipment meets the necessary qualifications for transporting the load. Below are the most prevalent types of trucks and the commodities they handle:


Dry Van: A Dry Van is an enclosed and fully protected truck used to transport dry and non-perishable goods.


Examples of commodities typically transported in a Dry Van truck include:


  • Products such as appliances, electronics, clothing, and toys.
  • Paper.
  • Bottled water, drinks.
  • Construction materials, such as drywall, wood, and ceramics.
  • Supplies and commercial products in general.
  • Canned foods and non-perishable dry goods.


Flatbed: A flatbed truck has no sides or a roof, designed to transport loads that need not be covered or sealed for protection.


Commodities that are typically transported in a flatbed include:


  • Heavy machinery and equipment, such as tractors, bulldozers, and construction equipment.
  • Large construction materials, such as steel beams, pipes, and precast concrete.
  • Large structures, such as manufactured housing modules.
  • Oversized products that do not fit in a closed trailer.


Reefer: A reefer truck is a refrigerated or frozen trailer designed to keep the temperature-controlled and suitable for perishable products.


Commodities transported in a Reefer include:


  • Fresh and frozen foods, such as meat, fish, fruits, vegetables, and dairy products.
  • Pharmaceuticals and drugs that require a controlled environment.
  • Temperature sensitive chemicals.
  • Flowers and plants that need to be kept cool during transport.


Radius of operation


The Radius of operation refers to the distance or geographic area within which a truck is authorized to operate under the insurance policy’s terms. This concept is fundamental in commercial truck insurance, as insurers consider distance and location of operation when determining rates, associated risks, and terms of coverage.


The Radius of operation can influence the cost of insurance renewal. Below we will tell you how:


  • The Radius of operation is used to calculate insurance rates. The more miles traveled, the greater the risk exposure and, therefore, the higher rates. A truck that travels long distances or goes through areas with increased traffic is more likely to encounter risky situations.


  • A truck operating in multiple states may need coverages that meet each jurisdiction’s legal and liability requirements, affecting the policy’s total cost.


  • If your Company’s radius of operation has changed or expanded, the insurer may adjust rates and terms of coverage based on this change. Therefore, providing accurate and up-to-date information is essential when renewing the policy.


Loss runs 


Loss runs are a detailed record of claims filed and payments made on a commercial insurance policy. It is a collection of information about past incidents that have led to claims and costs by the insurance company.


This record provides an overview of the frequency and severity of losses or claims the insured has experienced.A client needs to be transparent with this information for the following reasons:


  • Loss history is used to assess the risk associated with the insured. A history of frequent claims may indicate increased risk, so the insurance company may adjust rates or even deny coverage.


  • By providing an accurate and complete loss history, the client allows the insurance company to assess risk and set appropriate rates accurately.


  • Knowing the record of losses, the insurance company can customize the coverage and terms of the policy.


Mandatory Trucking Insurance Policies You Must Renew


When renewing your commercial truck insurance, the Liability and Motor Truck Cargo insurance coverages are mandatory to guarantee the safety of the parties involved in the event of an accident or eventuality, comply with the law, and reduce the financial risks associated with the operation of vehicles and cargo transportation. That your transport company has active Liability, and Motor Truck Cargo insurance guarantees you the following:


  • Legal and Financial Protection: The Liability insurance policy is mandatory to cover possible damages and injuries that an insured vehicle can cause to third parties.


  • Cargo Transport Security: The Motor Truck Cargo insurance policy is mandatory to protect the cargo transported in the trucks. Motor Truck Cargo coverage ensures the cargo owner is protected against financial loss in the event of cargo damage. Work is a mandatory requirement; with this coverage, the Brokers will assign loads to you.


On the other hand, other types of trucking insurance policies on the market meet different needs.


  • Physical Damage: It is how to insure the vehicle owned by the insured. It covers damage caused by natural disasters, theft or fire, collision, or rollover. It is not mandatory coverage for carriers.


  • Trailer Interchange Insurance: If you frequently interchange trailers in your operations, this coverage ensures physical damage protection for any trailer. It is mandatory for units that are being paid to financial institutions.


  • General Liability Insurance: Designed for all trucking businesses, our general liability coverage extends the scope and limits of existing policies. It offers comprehensive protection against defamation, third-party damages, and personal injury.
  • Workers Compensation: Coverage that protects employees in the event of a work-related injury (including death) due to an accident or occupational disease. Compensation is disbursed based on the terms and conditions of the insurance.


  • Umbrella Insurance: Enhances existing policy limits with general coverage. It provides comprehensive protection for injury, property damage, lawsuits, and other liability situations.


  • Excess Liability Insurance: Increases the coverage limit chosen with excess liability insurance for trucks. This additional coverage offers additional protection for your trucking business.


How soon should you renew your business insurance?


Commercial truck insurance is usually renewed every 12 months, but you can also find renewed policies every six months.


The renewal requirement of commercial trucking insurance must be made 30 calendar days before its expiration to not affect your company’s commercial operation. However, as expert advisors in commercial insurance, we recommend that you start the renewal process 60 calendar days in advance. In this way, you can collect the documentation, which is a requirement for renewal, compare quotes in the insurance market and not be against time since there are factors in the renewal process that do not depend on you but on the insurance company and can sometimes take longer than planned.


Financing options


Each insurance agency establishes different terms and conditions to offer financing options to transport companies.


In the case of Preventty – Insurance Agency, there are financing options, including Down Payment or initial payment. This is the amount paid when you buy or renew business insurance. This initial amount is usually a fraction of the total insurance cost, commonly 25%. After making the initial payment, the remaining 75% of the policy can be divided into ten monthly payments.


In summary,

Renewing the commercial truck insurance policy is vital to safeguard your business’s stability and success. An updated policy protects against possible risks and accidents, guaranteeing the continuity of your operations and the safety of your assets.


In addition, renewing on time allows you to review and adjust coverage according to your company’s changing needs, making sure you are always protected. Protect your investment with up-to-date and complete truck insurance.


Remember that renewing your commercial insurance within the established period will prevent your company from running out of business and losing loads.