Business Truck Insurance for Cargo

The goods America’s truckers haul each year are worth billions. Motor truck cargo insurance protects the value of the load you’re carrying up to a limit set by you when you purchase commercial auto insurance for your truck carrying cargo. While you aren’t required by federal law to carry this type of business truck insurance, the company you’re driving for probably will insist that you have it.

This type of business truck insurance provides legal liability coverage for both common and contract truckers while they are hauling cargo belonging to someone else. Under this type of business truck insurance coverage, the trucker is the insured party and the covered property is the property of others that is being transported by the insured trucker. In either instance, the trucker is liable for that property as a common carrier under the terms of a bill of lading ( which must be produced to the claims adjuster in the event of a claim situation) or as a contract carrier under terms spelled out in the shipper’s contract.

Your legal liability under this type of business truck insurance will differ depending on whether you are a common carrier or a contract carrier. Basically, as a common carrier you assume full responsibility for the safe delivery of the cargo you’re hauling. In other words, you have strict liability or liability without fault, except under several circumstances. These include: an act of God (an unanticipated storm, for example); public enemy (a terrorist attack, for instance); inherent vice (something is inherently wrong with your cargo beyond your control) ; act or fault of the shipper like shoddy packaging; or public authority (a government agency confiscates your cargo or places it under quarantine). As a contract carrier, your individual contract with the shipper will spell out the details of the liability you’re assuming. 

Under most business truck insurance policies covering cargo liability, your risk exposure begins when the cargo is delivered to and accepted by you. It ends when you deliver the shipment to the specified destination and it is accepted by the designated consignee. However, be aware that there are several conditions and extenuating circumstances regarding delivery that may affect your cargo liability, so read your business truck insurance policy carefully and understand truckers insurance basics.