25 truck insurance terms to know
Consider this your very own personal trucking insurance dictionary. These are truck insurance terms you should be familiar with as you navigate choosing a policy.
1. Bobtail/non-trucking liability insurance
Protection for your truck while you are off the clock. In general, the company you haul for only covers your insurance while you are under dispatch. This type of coverage gives you protection during other times, such as when you are getting the truck washed or repaired.
2. Commercial auto liability
In the event that you cause an accident, bodily injury coverage may help cover medical expenses and lost income for the other party. This type of policy may also help cover legal fees if you are facing a lawsuit because of the accident.
In the commercial trucking industry, large 18-wheelers are commonly referred to as carriers. You will also often hear this term applied to a company that operates these trucks. Simply put, a carrier is a company responsible for transporting products or people.
4. Collision coverage insurance
A type of insurance used to pay for repairs or replacement of your truck if you crash into another vehicle or object, such as a tree, wall, or fence.
The amount of money you must pay before your insurance company will pay a claim (specified in your policy).
6. Federal Motor Carrier Safety Administration (FMCSA)
The Federal Motor Carrier Safety Administration (FMCSA) was established within the Department of Transportation in 2000.
Formerly a part of the Federal Highway Administration, the Federal Motor Carrier Safety Administration’s primary mission is to prevent commercial motor vehicle-related fatalities and injuries. They are one of the main regulatory authorities for interstate trucking. The Administration works with federal, state, and local enforcement agencies, the motor carrier industry, and labor and safety interest groups.
7. Garage keeper’s liability insurance
Coverage that helps you pay to repair or replace a vehicle you don’t own. This situation generally happens when a vehicle is left in your care, custody, or control as a garage or towing operation.
8. General liability insurance
A type of insurance that can provide coverage if an issue occurs that isn’t directly related to operating your truck. These instances are generally related to customer injuries or property damage, as well as advertising conflicts. In short, this insurance can help protect your business from costly lawsuits.
9. Gross vehicle weight (GVW)
This is the fully loaded weight of a commercial truck. It includes both the weight of the vehicle itself, as well as the maximum load it can carry. Insurers use this as a rating factor for insurance. The heavier the vehicle, the longer it takes to stop, which can lead to more accidents. As a result, a higher GVW may lead to higher insurance premiums.
10. ICC/MC authority
Before you may legally haul regulated cargo, you must get permission from the Federal Motor Carrier Safety Administration by obtaining an MC number. Similar to the phased-out ICC authority, MC authority grants you the ability to transport regulated freight across state lines.
Any vehicle operating for hire in interstate transportation of regulated freight or passengers must comply. The minimum insurance coverage required depends on the Gross Vehicle Weight Rating (GVWR).
11. Interstate trucking
Interstate trucking is one of the truck insurance terms that define where you haul cargo and passengers. In general, it applies when you haul cargo or passengers across state lines. Specifically, interstate trucking refers to trucking activities that occur:
- Between a place in a state and a place outside of such state (including a place outside of the United States)
- Between two places in a state through another state or a place outside of the United States
- Between two places in a state as part of the trade, traffic, or transportation originating or terminating outside the state or the United States
12. Intrastate trucking
If your trucking activities occur exclusively in your business’s home state, then your business does intrastate trucking.
13. Medical payments (MedPay) insurance
An essential type of coverage that is meant to cover medical expenses. Regardless of who caused an accident, this coverage is extended to you and any other passengers in your vehicle who are hurt during an accident.
14. Motor truck cargo insurance
Insurance coverage for the cargo you are hauling for a shipper. This usually extends up to a set limit determined during the policy purchase. Federal law does not require it. However, some companies will request it.