Shippers and motor carriers are faced with a variety of potential loss events when their people and equipment operate with cargo over the road.
Transporting valuable goods that can be damaged or lost due to crashes, thefts, hijackings, while loading and unloading, or while held at terminals or en route.
Depending on the types of cargo you carry, the stakes can be high.
WHAT does Motor Truck Cargo protect against?
When you provide cargo transportation services, you could be held liable if the property you carry is damaged or destroyed.
There are many common risks that could destroy your cargo on the way to its destination, from vehicle collisions or overturns to fire and theft. In addition to the costs of the accident itself, a damaged or destroyed shipment can have a highly negative impact on your relationship with clients. This is why it’s important to purchase adequate coverage for the goods you carry. If your insurance is not sufficient to cover a claim, your company could be required to pay for damages, especially if the commodities are valuable.
Motor Truck Cargo insurance provides coverage against direct physical loss to covered property while in transit and loading or unloading. It covers property while at a terminal or dock awaiting final shipment.
This coverage can be customized with coverage extensions that help pay for losses caused by Food Spoilage, Temperature Changes Due to the Breakdown of Refrigeration or Heating Equipment (Reefer Breakdown), whether in a terminal or on a truck ready for transport.
Why is Motor Truck Cargo important?
- Cargo Insurance protects your investment, and covers your goods for loss, damage or delay. Without cargo insurance, all cargo is handled, stored and carried at the shipper's, owner's and consignee's risk
- Vehicles involved in for-hire transportation (e.g., trucking companies) are required to carry Motor Truck Cargo Coverage by the Federal Motor Carrier Safety Administration (FMCSA), and companies that ship goods with your company will often require you to have it via written contract.
Common Motor Truck Cargo Limits
Average cargo limits range from $20,0000 to $100,000. However, in some cases, companies will require a higher limit based on the commodities your are hauling.
For example, most dump trucks hauling dirt and gravel need up to $20,000 in cargo coverage as the cost of the goods hauled does not typically exceed $20,000.
A Trucker that hauls electronics/higher valued freight would need higher cargo limits as those goods being hauled are more expensive.
The most common limit is $100,000 required by most written contracts with trucking firms.
How much does Motor Truck Cargo Typically Cost?
Factors like prior loss history, commodities being hauled and location where the goods are being transported are major factors that influence the costs of cargo insurance.
Like most other coverages, cargo insurance is tailored to suit the truckingompany's specific needs, based on their specific operation and commodities hauled.
Motor Truck Cargo coverage has various exclusions. Therefore, it is important to have a knowledgeable agent who will provide the coverage that best suits your needs and explain all limitations of the policy.