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1. What is the difference between primary liability and secondary liability (i.e., bobtail, unladen, non-trucking)?
Primary liability coverage is protection for the public and is required by FMCSA to obtain your own authority. Secondary liability coverage is required by your motor carrier and only covers you while under a permanent signed lease with them. Please see our list of coverages for differences between the secondary liability coverages.
FMCSA only requires $750,000 primary liability coverage, but most shippers/brokers require $1,000,000 to load you. The most common request for cargo is $100,000, but this would depend on what you’re hauling and who you are hauling for.
Primary liability coverage. If you are running under your own authority, you should have this coverage in your name. If you are leased to a Motor carrier, then you should have this coverage through them.
Physical damage covers the investment you have made in your truck. It covers a variety of perils other than collision, such as; fire, theft, vandalism, wind, and hail. If there is no legal lienholder at the time of a covered claim, then the insurance carrier will issue the claim check to the owner.
FMCSA requires the motor carrier whose authority you are running under to obtain the Primary Liability and Cargo coverage. However, the motor carrier can charge you for this coverage. You need to review any lease agreements carefully before signing them to determine what fees the motor carrier is charging you for.
Usually not as most states require proof of financial responsibility, which is the Primary Auto Liability Insurance, not Bobtail Liability. Depending on the day and who is helping you at the DMV, you may get by with using proof of Bobtail.
7. What is my truck valued at and what is the difference between actual cash value and stated limit?
There is no value set on equipment as the actual cash value is the cost of your equipment at the time of a loss minus depreciation. A Stated Limit Policy is when the insured places a value on their equipment. In the event of a loss, a Stated Limit Policy will pay either the actual cash value or the stated limit, whichever is less. Insured’s with stated limit policies can risk over insuring or under-insuring their equipment. Insuring at Actual Cash Value is the typical way to insure your rig. The value is usually set at what you could currently buy or sell the unit, and the claim is paid on that value as of the day of the claim.
Auto Liability and Cargo insurance are the most important coverage’s required to run under your own authority. Other coverages may be required in your contract(s) with your brokers and shippers.
9. Am I required to have higher limits of auto liability and cargo insurance if I am a car hauler with my own authority?
Yes, FMCSCA requires all car hauling operations to carry $1,000,000.00 in Liability, even though the minimum requirements set by FMCSA for general operations are only $750,000.00. Cargo limits are typically higher than the usual $100,000.00 and would need to be determined based on several factors including your broker and shipper requirements, what type of automobiles are being hauled and how many automobiles can be hauled at one time.
Any requirements for secondary liability; i.e., bobtail/non-trucking or unladen liability, coverage’s should be specified in your lease agreement with the motor carrier. The lease should also list any additional coverage’s the motor carrier requires. Then you will always have the option to purchase additional coverage on your own to protect your equipment.
No. If the primary auto liability is in your name or your corporation and you are the owner of the truck, you would not be required to carry bobtail liability.
Admitted carriers are licensed in a particular state to do business and are regulated by each state’s Division of Insurance. The states are required to monitor the finances, and market conduct of the admitted carrier companies and all admitted carriers are obligated to contribute to a state fund – or guaranty fund – which is used to pay claims if any of these licensed insurers were to go insolvent. A surplus line’s carrier is not required to be licensed in your state but does need to be licensed in the state in which they are domiciled. The Division of Insurance or some other type of authority monitors the financial condition of the surplus lines carrier to ensure solvency as there is no guarantee fund.
Be honest with your agent about your operation and records. Operating your business in a professional manner, maintaining good safety scores and remaining loss-free, will help you receive the best rates. Make sure when you are looking at premiums you are also comparing coverage. Not all policies are equal. The lowest rate does not always equate to adequate coverage and excellent service. We do our best to present you with the best coverage at the lowest rate possible.
Marine FAQs (Personally Owned Watercrafts)
You’re probably not required by law to have boat insurance, but that doesn’t mean you don’t need it. A few states require that you have liability coverage on certain types of boats — powerboats with more than 50 horsepower or PWCs, for example — or boats used in state parks or kept in state-run marinas.
This coverage insures your boat against damage and loss caused by common risks, such as sinking, fires, storms, theft, and collision. The property covered can vary, but the policy will usually cover the hull and other permanent components, such as the motors.
When options are chosen, boat insurance covers damage to your boat, motor, trailer, and personal items in the boat. It protects the boat owner against liability lawsuits and medical payments. Boat insurance protects most watercrafts with engines including small fishing boats, powerboats, houseboats, yachts, and pontoons
Boat insurance policies can be customized to cover your boat, your passengers, your personal possessions and yourself. Boat coverage options also can include bodily injury liability which can help pay for injuries to others from a covered accident if you are found to be legally liable.
The policy will also cover the liability exposure if the craft is involved in an accident and another person is hurt. But the problem comes if the driver of the boat is not listed on the insurance policy. … It will cover any person that operates the boat as long as they are listed on the policy.
Will my homeowner’s insurance cover my boat? … Typically, however, a homeowner’s insurance policy will only cover damage to your boat that occurs while it is on your property. Further, the amount of coverage offered is typically less than in a boat insurance policy, which can lead to problems if the boat is damaged.
OCEAN MARINE FAQs (Commercially Owned and Operated Vessels)
These policies provide (1) Hull & Equipment property damage coverage from various perils of the sea on scheduled vessels, (2) Protection and indemnity (P&I) liability for bodily injury or property damage caused by the insured to a third party (incl. its own passengers and crew), (3) Vessel Pollution Liability coverage, and (4) Excess Protection and Indemnity including Excess Vessel Pollution Liability.
The vessel and equipment values are based on market value which is what the vessel and its attached equipment would sell for in the current market.
The protection and indemnity policies cover third-party legal liability risks for vessel operations including cargo, crew, personal injury to third parties, passengers, stowaways, collisions, damage to fixed and floating objects, wreck removal and fines. There are three optional liability coverages within P&I: (1) for your vessel only, (2) for your passengers, and (3) for your crewmembers. Your crewmembers P&I coverage would include claims made under the Jones Act, a federal law that allows an employee acting as a crewperson to bring suit against a vessel owner for negligence resulting in injury.
This coverage is designed to cover cost and damages incurred by the insured (agency) for removal, response or remedial action due to legal liabilities caused by discharges, releases of a hazardous substance under the (1) Oil Pollution Act of 1990, (2) Comprehensive Environmental Response, Compensation and Liability Act (CERCLA), (3) spills of other substances and (4) other Federal and State Law.
No, you must also buy P&I coverage on the vessel in order to buy the Vessel Pollution Liability coverage.
You would buy excess coverage if you need a higher limit of insurance than $1,000,000 for your P&I and Pollution Liability exposures.
You can add a vessel to the schedule during the policy period. The vessel premium will be pro-rated (the effective date of coverage to the end of the policy period).
If a vessel is to be deleted, a pro-rated return premium will be credited to the policy owner.
This policy provides coverages to specific waters and tributaries.
We can help you decide which policy or policies are right for your business. Additional coverage for property, liability, perils or conditions otherwise excluded (e.g., flood protection) can be purchased as endorsements to a standard policy or as a separate, second policy. Because businesses vary, it is impossible to have a standard policy to cover all contingencies. Also, some businesses, regardless of their size, do not fit the profile of a standard business owners policy. For example, restaurants, wholesalers, and garages have special liability needs that are not met in the standard business owners policy. We can advise you of the best policy (or policies) to protect you and your business.
No business can afford to be unprepared for a lawsuit. General liability insurance protects your business assets when the business is sued for something the business did (or failed to do) that contributed to injury or property damage to someone else. Liability coverage extends not only to paying damages but also to the attorneys’ fees and other costs involved in defending against the lawsuit – whether valid or not.
Usually excluded from general liability insurance policies are suits by customers against a business for nonperformance of a contract and by employees charging wrongful termination, racial or gender discrimination, or harassment. For this coverage, businesses should purchase professional liability coverage and employee-related practices coverage.
Check with us about the best liability protection covering all types of situations that may arise in your business.
The best thing to do is to take a complete inventory of all your business property, determine the value and decide if each is worth insuring. Then check to see that the items on the inventory list are included in the basic business property policy and covered for the correct amount. If not, ask us about the cost of purchasing additional coverage to meet your needs.
You also need to consider your business situation. Are you planning a major expansion? Does your inventory have a decidedly peak season? Or does it fluctuate throughout the year? Is your liability limit high enough in light of the new job contract you just signed? Business policies are designed to be added to or subtracted from to meet your needs. Be sure to discuss changes to your business with us so that we can be sure your policy still provides adequate coverage. Some common additional coverages for business property include (although this list is by no means all-inclusive):
Boiler and Machinery Insurance
Even if you do not own a boiler, you may need this coverage. The term “boiler and machinery insurance” is gradually being replaced with terms such as “equipment breakdown” or “mechanical breakdown” coverage. This insurance provides coverage against the sudden and accidental breakdown of boilers, machinery or equipment, including computer systems and telephones/communication systems. Coverage usually includes reimbursement for property damage, expediting expenses (e.g., express transportation charges), and business interruption losses.
Builders Risk Coverage
Covers buildings in the course of construction. Depending on the policy, this coverage can be for either the building’s value at the time of the loss or its full value at the time of completion.
Commercial Crime Coverages
Covers money and securities, stock and fixtures against theft, burglary, and robbery both on and off the insured premises and from both employees and outsiders.
Provides coverage for glass breakage such as store windows and plate glass on office fronts.
Inland Marine Insurance
Primarily covers property in transit such as from warehouse to warehouse or warehouse to retail store, as well as other people’s property left on your business premises, such as clothes left at a dry cleaning business or an employer’s personal effects left in the company locker room.
Property insurance can be purchased on the basis of the property’s actual value, on its replacement cost, or an agreed amount. The differences between the three are:
Actual Cash Value
The replacement cost of the item minus depreciation. For example, a new desk may cost $500. If your seven-year-old desk gets damaged in a fire, it might have depreciated 50 percent. Therefore, you would be paid $250 for it.
The cost of replacing an item without deducting for depreciation. So today’s cost for a desk of a size and construction similar to the seven-year-old one damaged by fire would determine the amount of compensation. If it costs $500 today, that would be the replacement coverage.
Art objects, antiques and other unique items are usually insured at an amount agreed upon when the policy is being written. An appraiser values the goods to be insured and the business owner and the insurer agree upon an amount that the insurer will pay if the goods are destroyed due to a covered peril. Check your policy. If you prefer replacement coverage and do not already have it, this coverage can be added to your policy. Inflation-guard coverage, which automatically increases your insurance amount a certain percentage, protects against rising construction costs. We can advise you of the costs involved.