Truck Insurance: Some drivers may consider leasing a vehicle instead of purchasing. Although you do not take ownership of a leased vehicle (unless you decide to purchase it at the end of the lease period), you are still responsible for obtaining and paying for insurance coverage. According to the Federal Motor Carrier Safety Administration (FMCSA), the minimum requirements for leased trucks are the same as for company-owned vehicles. [/box]
[box type=”shadow”]Minimum Requirements
Primary liability coverage is required by law for bodily injury or property damage caused by commercial trucks engaged in interstate commerce. According to FMCSA, the minimum levels of coverage depend on the type of carrier (tractor), type of equipment (trailer) and the commodity being transported. The minimum coverage is $750,000 for carriers with a gross vehicle weight rating exceeding 10,000 pounds that haul non-hazardous commodities. The minimum coverage increases to $1 million for carriers with a gross vehicle weight rating exceeding 10,000 pounds that haul oil, hazardous waste or hazardous materials and substances. Carriers hauling portable tanks, cargo or hopper-type equipment with capacities in excess of 3,500 water gallons must obtain coverage of at least $5 million.
The Statutory Employer Rule for Commercial Carriers
Innocent people are occasionally injured and killed due to the negligence of drivers of leased trucks. To avoid finger-pointing by lessees, lessors, drivers and insurers resulting from these tragic events, FMCSA regulations make the lessee responsible to the injured party. In effect, lessees must have minimum primary liability insurance coverage for leased trucks operated for their benefit. And, because lessees have a legal duty to control leased vehicles and drivers of leased vehicles, FMCSA regulations create a statutory relationship whereby employees of lessors become statutory employees of lessees.
State Statutory Financial Responsibility Provisions
Common carriers engaged in both interstate and intrastate commerce are subject to state statutory insurance requirements in addition to FMCSA requirements. Most states typically adhere to FMCSA regulations governing motor carrier responsibility for minimum liability insurance coverage. In Georgia, for example, the motor carrier lessee is fully responsible for insurance coverage for leased trucks. However, truckers should check with their respective states to ensure they are in full compliance with insurance requirements for leased trucks.
Other Insurance Considerations
FMCSA is primarily concerned with protecting the public from potential harm caused by commercial carriers operating in interstate commerce under its authority. In this regard, bodily injury and property damage coverage protects the public from the negligence of motor carriers. Owners/drivers of leased trucks should also be concerned about protecting themselves from damage to their trucks from accidents, vandalism and theft. Comprehensive coverage is an important protection against these kinds of damages, which can prove extremely expensive in the absence of such coverage. Many owner-operators also carry bobtail insurance, which provides coverage when they are not on the job and not covered by the motor-carrier’s insurance policy.