Truck Insurance Terms

Truck Insurance Terms

This glossary covers many of the essential insurance terms used in the commercial trucking industry. However, insurance can be complex, and it’s crucial to consult with a qualified insurance professional to fully understand your specific coverage needs and options.

Commercial Auto Insurance: A policy that provides coverage for vehicles used for business purposes, including trucks used in the commercial trucking industry.

Motor Truck Cargo Insurance: Coverage that protects against damage to or theft of the cargo being transported by a truck.

Liability Insurance: Coverage that pays for bodily injury and property damage that the insured is legally responsible for due to an accident involving their truck.

Physical Damage Insurance: Coverage that pays for damage to the insured truck itself, including collision and comprehensive coverage.

Collision Coverage: Part of physical damage insurance that pays for damage to the insured truck caused by a collision with another vehicle or object.

Comprehensive Coverage: Part of physical damage insurance that pays for damage to the insured truck caused by non-collision events, such as theft, vandalism, fire, or natural disasters.

Bobtail Insurance: Coverage for trucks when they are not hauling a trailer, such as when returning from a delivery without cargo.

Non-Trucking Liability Insurance: Coverage for liability when a truck is being operated for personal use and not for business purposes.

Umbrella Insurance: A supplemental policy that provides additional liability coverage above and beyond the limits of the primary insurance policy.

Deductible: The amount of money the insured must pay out of pocket before the insurance policy covers the remaining expenses.

Cargo Insurance: Coverage that protects the cargo being transported against loss or damage during transit.

Trailer Interchange Insurance: Coverage for damage to trailers that are not owned by the insured but are in their possession under a trailer interchange agreement.

Primary Liability Insurance: The insurance that pays for injuries and damages caused by the insured truck in the event of an accident.

Excess Liability Insurance: Additional liability coverage that extends beyond the limits of primary liability insurance.

Underinsured Motorist Coverage: Coverage that protects the insured if they are involved in an accident with a motorist who has insufficient insurance coverage.

Uninsured Motorist Coverage: Coverage that protects the insured if they are involved in an accident with a motorist who has no insurance.

Aggregate Limit: The maximum amount an insurance policy will pay out over a specified period, often a year.

Occurrence: An event that triggers coverage under an insurance policy.

Policyholder: The person or entity that owns the insurance policy and is protected by it.

Premium: The amount of money the insured pays to the insurance company in exchange for coverage.

Endorsement: An addition to an insurance policy that modifies or expands its coverage.

Loss Control: Efforts made by the insured to prevent accidents and minimize potential claims.

Loss Ratio: The ratio of claims paid by an insurance company to the premiums received.

Indemnity: The principle that insurance is meant to return the insured to the financial position they were in before a covered loss occurred.

FMCSA (Federal Motor Carrier Safety Administration): The U.S. government agency responsible for regulating and overseeing the trucking industry, including insurance requirements.

DOT (Department of Transportation): The U.S. government agency that sets regulations and standards for the transportation industry, including commercial trucking.

Broker: A person or company that connects trucking companies with insurance providers to obtain coverage.

Certificate of Insurance: A document that provides proof of insurance coverage and outlines the details of the policy.