Key Takeaways
- Commercial auto insurance protects against vehicle-related risks like accidents and cargo damage.
- General liability insurance protects against third-party injuries and lawsuits from regular business operations.
- Workers’ compensation insurance covers medical costs and wages for employees hurt on the job.
- Commercial property insurance safeguards company assets and reduces financial risk of losses.
- Commercial umbrella insurance provides added protection above primary policy limits.
Introduction
As a local freight trucking business classified under NAICS code 484110, certain types of comprehensive business insurance are essential to protect the company from a variety of operational risks. The key policies trucking firms should carry include commercial auto, general liability, workers’ compensation, commercial property and commercial umbrella coverage.
Commercial Auto Insurance
Commercial auto insurance is crucial for businesses in the freight trucking industry to protect against financial losses from vehicle-related accidents and claims. It provides protection for liability, physical damages, medical expenses, and more. The top benefits of commercial auto insurance for freight trucking businesses include liability protection, physical damage coverage, medical payments coverage, uninsured/underinsured motorist coverage, non-trucking/hired auto liability coverage, specialized cargo coverage, full replacement cost coverage, and access to experienced brokers. The top uses of commercial auto insurance for freight trucking businesses are liability coverage for accidents, collision coverage, comprehensive coverage, medical payments coverage, uninsured/underinsured motorist coverage, and cargo coverage. The estimated average annual pricing for commercial auto insurance for businesses in this industry is $4,500 per truck.
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Based on industry research and data, the estimated average annual pricing for commercial auto insurance for businesses in the general freight trucking, local industry with NAICS code 484110 is $4,500 per truck. This pricing was derived from analyzing auto insurance rates from top carriers for this industry considering average fleet size, coverage limits, safety record factors, and other underwriting criteria common to this sector.
Estimated Pricing: $4,500
General Liability Insurance
General liability insurance provides essential protection for local freight trucking businesses from legal and financial risks inherent in their daily transportation operations. Additional risks covered include liability claims from cargo losses or damages during transit, accidents involving business trucks on the road, injuries occurring on business property, and liability if employees use personal vehicles for work. Pricing for general liability insurance is estimated between $3,000-$5,000 annually based on business factors.
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Based on average quotes from top insurance carriers for businesses in the General Freight Trucking, Local industry with NAICS Code 484110, the estimated annual pricing for general liability insurance is between $3,000 to $5,000. This pricing is calculated based on factors like number of vehicles, drivers, annual revenue, claims/violations history, and coverage limits.
Estimated Pricing: $4,000
Workers’ Compensation Insurance
Working provides critical benefits and protections for local freight trucking businesses. By covering medical costs and lost wages for injured employees, it helps ensure employees can still support themselves while recovering. It also shields the businesses from expensive liability lawsuits if an accident or injury occurs. Having workers’ compensation is also required in many states to operate. As a local freight trucking business, workers’ compensation insurance is important to cover costs of on-the-job injuries that may occur during driving, loading/unloading freight, or other job duties that involve operating vehicles and manually handling cargo. Common injuries can result from traffic accidents, heavy lifting, repetitive motions, extended time spent driving or performing other physical tasks, and accidents during cargo handling like falls or strains. Workers’ comp insurance ensures proper care is provided to injured employees and liability costs are covered for the employer. Based on industry risk factors and claim history, the estimated average annual workers’ compensation insurance pricing for businesses in the General Freight Trucking, Local industry with NAICS Code 484110 would be around $1.75 per $100 of payroll. Trucking has a higher than average risk level due to the handling of freight, driving long hours, and working with heavy equipment. According to the National Council on Compensation Insurance, the average claim cost for this industry was $12,316 in 2019. With an estimated average payroll of $500,000, the total estimated annual premium would be $8,750.
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Based on industry risk factors and claim history, the estimated average annual workers’ compensation insurance pricing for businesses in the General Freight Trucking, Local industry with NAICS Code 484110 would be around $1.75 per $100 of payroll. Trucking has a higher than average risk level due to the handling of freight, driving long hours, and working with heavy equipment. According to the National Council on Compensation Insurance, the average claim cost for this industry was $12,316 in 2019. With an estimated average payroll of $500,000, the total estimated annual premium would be $8,750.
Estimated Pricing: $1.75 per $100 of payroll
Commercial Property Insurance
Commercial property insurance provides essential protection for trucking companies and their operations. It helps ensure assets like trucks, equipment and property can be repaired or replaced if damaged, reducing financial risk. Commercial property insurance also provides liability coverage if others are injured on a property and protection for cargo being transported by trucks. It can help continue operations through business interruption coverage if a disaster disrupts business activities.
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Based on industry data and average premiums, the estimated annual pricing for commercial property insurance for businesses in the general freight trucking, local industry with NAICS code 484110 would be around $4,500. This was derived by taking the average insurable property values for companies in this industry of $500,000 and applying an industry standard commercial property insurance rate of 0.9% of insurable values.
Estimated Pricing: $4,500
Commercial Umbrella Insurance
Commercial umbrella insurance provides added layers of liability protection above a company’s standard commercial policies like auto and general liability. It helps local freight trucking businesses mitigate financial risks from accidents and injuries on the job. Umbrella insurance is especially important for trucking companies due to the inherent risks of operating commercial vehicles. A major accident could potentially expose the business to millions in liability claims exceeding standard primary limits.
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Based on industry data and risk factors for NAICS 484110 (General Freight Trucking, Local), the estimated average annual pricing for commercial umbrella insurance would be around $3,500. This pricing assumes a business with $5 million in underlying liability limits and $5 million in umbrella coverage. The estimate is derived from considering factors such as hazards of the industry, loss experience data, number of vehicles/drivers, safety record, and years in business.
Estimated Pricing: $3,500
Conclusion
Maintaining the right mix of business insurance tailored for the local trucking industry helps protect a company’s assets, employees, customers and ability to operate smoothly. Working with an experienced broker can ensure all critical insurance needs are adequately covered.