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Hotshot Trucking Insurance Guide

You’ve put down a handsome amount on a heavy-duty truck and a decent trailer. You’ve got all of your tie-downs and other gear in place. Clients are waiting to hire you.

You’ve established yourself as the go-to guy for small shipments that need to be made on a limited basis. You’re quick, dependable, and eager to grow your business.

Your hotshot trucking business isn’t just about your vehicle, trailer, or cargo. It also includes defensive measures – both for yourself and other drivers on the road – to protect you from dangers. One severe accident may destroy your business.

That’s why hotshot trucking insurance is so important for your business. Some coverage is necessary.

Don’t consider insurance coverage a box to check off and then forget about. Consider it what it is: an investment in your hotshot trucking career and personal financial stability.

Here are the details you need to know about hotshot trucking insurance.

What is Hotshot Trucking Insurance?

Hotshot trucking insurance is a type of insurance that covers you, your truck, and your trailer in the event of an accident.

It’s important to note that not all accidents are equal. There are different types of coverage for different types of accidents. So, it’s important to know what each policy covers before you purchase one.

In most cases, brokers and shippers will refuse to work with you if you don’t have that; moreover, FMCSA will require it.

Who Needs Hotshot Trucking Insurance?

As a hotshot trucker, you must have some form of insurance before you can even think about hitting the road.

The FMCSA (Federal Motor Carrier Safety Administration) requires all commercial truckers to have liability insurance. This is the minimum coverage that will protect other drivers in an accident caused by you.

However, liability insurance will not protect your vehicle or your cargo in the event of an accident. So, if you want to be fully protected, you’ll need to purchase additional coverage.

We have three different types of trucks that are used in the hotshot trucking;

  1. Class 3 (10,001–14,000lbs): Includes GMC Sierra 3500, Ram 3500 and Ford F-350
  2. Class 4 (14,001–16,000lbs): Includes Chevrolet Silverado 4500HD, Ford F-450, and Ram 4500
  3. Class 5 (16,001–19,500lbs): Includes Chevrolet Silverado 5500HD, Ford F-550, Peterbilt 325, and Ram 5500

There are some specific types of trailers for hotshot truckers that are;

  • 20 to 40-foot gooseneck trailers (common)
  • Dovetail trailers (common)
  • Deckover trailers
  • Lowboy trailers

If you are the one who is using your small truck and trailer for the shorter deliveries faster than the other truckers, then you might be the hotshot trucker. SO you need to have specific insurance to protect yourself from any kind of accident.

What’s Covered in Hotshot Trucking Insurance?

The type of coverage you need will depend on the trucking you do and the types of loads you haul.

For example, if you only haul small loads within a 200-mile radius, you probably won’t need the same level of coverage as a hotshot trucker who hauls large loads across the country.

In the hotshot trucking insurance, three things will protect you:

  • Truck
  • Trailer
  • Cargo

A comprehensive insurance policy will cover your equipment for your trip. Medical expenses, as well as bodily injuries and liabilities, are frequently fully reimbursed by Hotshot insurance. Fire, theft, and vandalism protection are also included in the policy.

The coverage you choose for your cargo should match the value of your hotshot freight. Search for policies that give you the flexibility to compensate for the worth of your goods, especially if you’re transporting several LTL loads using many Bills of lading (BOL). A policy should cover each load with a limit of $100,000.

The most expensive component of hotshots trucking is, without a doubt, insurance. Consider it as an investment in your company and prospects. One accident might bankrupt you financially if you don’t have the right insurance. You’re protected with the appropriate coverage, and more importantly, you can recoup after an accident to continue operating.

Types of Hotshot Trucking Coverage

The more secure your purchase, the more protected you are. You need to discuss it with your insurance agent to include the following coverage in your hotshots’ trucking insurance policies.

1. Liability Insurance

This will protect you from third-party bodily injuries and property damage claims in the event of an accident.

2. Liability insurance comes in two forms:

Property Damage Coverage: This will cover the repairs or replacement costs of any property damaged in an accident caused by you. This includes other vehicles, buildings, telephone poles, fences, etc.

Bodily Injury Coverage: This will cover the medical expenses of any person injured in an accident caused by you. It will also cover their lost wages if they’re unable to work and any legal fees associated with the accident.

3. Cargo Insurance

This will protect your cargo in the event of loss or damage while it’s in transit. It will also cover you if your cargo is lost or stolen.

There are two forms of cargo insurance:

All-Risk Coverage: This will cover your cargo regardless of how it was lost or damaged.

Named-Perils Coverage: This will only cover your cargo in the event of loss or damage caused by a specific peril, such as fire, theft, or vandalism.

4. Comprehensive Insurance

This will cover your truck in the event of an accident, regardless of who is at fault. It will also cover your truck in the event of fire, theft, or vandalism.

5. Collision Insurance

This will cover your truck in the event of an accident, regardless of who is at fault. For example, if you will collide with someone or a stationary object. Comprehensive and Collison insurance combine to make full coverage.

6. Towing and Storage Insurance

This will cover the cost of towing and storing your truck in the event of an accident or breakdown.

7. Loading and Unloading Insurance

Loading and Unloading Insurance will cover the cost of loading and unloading your cargo in an accident or breakdown.

8. Earned Freight Insurance

Hotshot truckers can get earned freight as a company income loss coverage. Whether you’re in an accident or the cargo is damaged while being loaded, If you have a covered peril and submit a claim, your lost earnings can be reimbursed if the cargo is not delivered.

9. Bobtail Coverage Insurance

Bobtail Coverage is an add-on to your liability insurance that will cover your truck in the event of an accident while you’re not hauling a load.

10. Downtime Insurance

Downtime insurance will cover the cost of repairs to your truck if it is damaged in an accident or breakdown. It will also cover the cost of renting a replacement truck while yours is being repaired.

11. Medical Payments Insurance

Medical payments insurance will cover the medical expenses of you and your passengers in the event of an accident, regardless of who is at fault.

12. Personal Injury Protection

Personal injury protection will cover the medical expenses of you and your passengers in the event of an accident, regardless of who is at fault. It will also cover lost wages and other expenses incurred due to the accident.

13. Family Emergency Expenses Insurance

Family emergency expenses insurance will cover the cost of transportation and lodging for your family in an accident or breakdown. It will also cover the cost of childcare and other expenses incurred due to the accident.

14. Equipment Coverage Insurance

This will cover the cost of repairs or replacement of your truck’s equipment in an accident or breakdown. This includes your trailer, fifth wheel, and other tools and equipment.

15. Debris Removal Insurance

Debris removal insurance will cover the cost of removing debris from the road in the event of an accident. This will cover the cost of repairs or replacing any property damaged in an accident caused by you. This includes other vehicles, buildings, telephone poles, fences, etc.

16. Broadened Pollution Insurance

Broadened pollution insurance will cover the cost of cleanup and repairs in the event that your truck causes an environmental disaster. This could include a fuel spill, toxic chemical spill, or oil slick.

17. Loss Mitigation Insurance

Loss mitigation insurance will cover the cost of repairs or replacing your truck if it is damaged in an accident or stolen. It will also cover the cost of renting a replacement truck while yours is being repaired.

18. Gap Coverage Insurance

Gap coverage insurance will cover the difference between the amount you owe on your truck and the amount your insurance company will pay in an accident or theft. This is important if you have a loan or lease on your truck.

19. Umbrella Insurance

Umbrella insurance will provide coverage if you are sued for damages in an accident. This could include medical expenses, property damage, and other damages. It will also cover your legal fees if you are sued.

You should be familiar with a few types when searching for hotshot trucking insurance. You may not need all of these types of coverage, but it is important to know what is available to you. Speak with your insurance agent to determine which types of coverage are right for you and your business.

Is Hotshot Trucking Insurance Required?

The short answer is yes; hotshot trucking insurance is required if you want to operate your business legally. The Federal Motor Carrier Safety Administration (FMCSA) requires all interstate commercial motor vehicles (CMVs) to be properly insured. This includes hotshot trucks.

The minimum amount of liability insurance that you must have is $750,000 for vehicles that carry cargo and $5,000,000 for vehicles that carry passengers. You must also have $300,000 of motor carrier liability insurance if your truck weighs over 10,000 pounds.

You may also be required to have additional types of insurance, depending on the type of cargo you are hauling and the states you will be operating in. For example, if you are hauling hazardous materials, you will be required to have hazmat insurance.

It is important to note that the FMCSA does not provide insurance for hotshot trucks. You must purchase your policy from an insurance company.

Before starting your own hotshot trucking business, make sure you fulfill these requirements.

  • Not having the proper insurance can result in heavy fines and even the shut down of your business.

How Much Does Hotshot Trucking Insurance Cost?

The cost of hotshot trucking insurance will vary depending on several factors, such as the type of coverage you need, the size of your truck, and the states you will be operating in.

For example, a basic liability policy for a small hotshot truck may start at $750 per year. A comprehensive policy for a large hotshot truck operating in multiple states may cost $5,000 per year or more.

To get an accurate quote for your business, speak with an insurance agent specializing in hotshot trucking insurance. They will be able to determine the coverage you need and get you the best rate possible.

Tips for Saving on Hotshot Trucking Insurance

You can do a few things to save money on hotshot trucking insurance.

  1. Shop around and compare rates from different companies.
  2. Pay your policy in full to avoid finance charges.
  3. Choose a higher deductible to lower your premium.
  4. Join an insurance pool or association.
  5. Use telematics to track your driving habits and lower your rate.
  6. Keep your truck in good condition and free of any defects.

By following these tips, you can save money on hotshot trucking insurance and ensure you have the coverage you need.

Conclusion

The FMCSA requires hotshot trucking insurance if you want to operate your business legally. The cost of hotshot trucking insurance will vary depending on several factors, such as the type of coverage you need, the size of your truck, and the states you will be operating in.

Moreover, you can save money on hotshot trucking insurance by shopping around and comparing rates from different companies, paying your policy in full, choosing a higher deductible, joining an insurance pool or association, and using telematics to track your driving habits.

 

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