8 Ways to Lower your Commercial Truck Insurance Rate

Sep 28, 2022 1:58:32 PM / by Mike Riegel

Truck insurance is one of the main expenses a trucking company will have to pay. With claims that are able to easily cross over $100,000+ it takes a lot to cover a truck on the road. The FMCSR requires all carriers to have a minimum of $750,000 in liability insurance just to operate. A new owner/operator can expect to pay $1,500 - $3,500 per month using their own authority. High insurance rates is a main reason why newer owner/operators prefer to lease on to another company.

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Price index of Premiums for Commercial Auto Insurance from 1999-2022 from the Federal Reserve Bank of St. Louis

 

If you are interested in operating under your own authority and grow your trucking company, here are 8 ways to help lower your commercial insurance rates.

1. Hire experienced drivers

The type of drivers you employ is a big factor in determining what your insurance rates will be. Experienced drivers are able to handle bad weather, road conditions, construction areas and all of the other types of operating conditions that a driver will face. Hiring new drivers without the experience increases the risk of an accident and can cause the insurance company to factor that as a reason for higher rates.

Once you have a team of experienced drivers, be sure to do everything in your ability to keep them. There are many ways to boost driver retention and keeping happy drivers will guarantee you maintain the lowest rates possible

2. Make sure drivers have a clean driving record

The Federal Motor Carrier Safety Administration (FMCSA) requires employers to obtain and review a motor vehicle record from every state in which a commercial driver has held a license during the previous three years. This practice helps you understand what drivers you are bringing in to your company. Drivers with a history of accidents and violations increase the likelihood of repeat accidents. Bad driving records is also a main cause that raises a carriers CSA score.

3. Review and optimize your truck routes

Optimizing your truck routes also helps carriers reduce their commercial truck insurance cost. Trucks that are able to avoid high traffic and major metropolitan areas are less likely to get into an accident. With today's ELD technology carriers and dispatchers can review a driver's route history. Reviewing trends of going through cities when there are routes around can help avoid reckless drivers and avoid accidents.

Taking some time each month to review your fleet's routes can help plan what the best course is for future loads and help you get your truck insurance cost down.

keep hos violations off of your csa score

 

4. Use newer trucks

Newer trucks have better tools and built-in technology as well as significantly less "wear and tear". Operating older trucks have a higher chance of breaking down during use and sets the scene for a potential accident.

5. Raise your deductible

Having a low deductible means you pay less out of pocket when you have an accident but that privilege comes at the cost of higher rates. By raising your deductible you can lower insurance premiums. If you have the ability to maintain a rainy day fund for anticipated accidents this may be a good way to get a lower insurance rate for your trucks

6. Keep a good CSA score

Your CSA score is your company's reputation in the eyes of the FMCSA. Knowing what your CSA score is and understanding what all goes into calculating it is key to lowering your commercial truck insurance rates. CSA scores are based on accidents and other driving factors performed by you or your drivers. Following all of the FMCSA's BASICs guidelines and reducing the number of inspections, violations and accidents will help you keep a low CSA score.

7. Share ELD data with your provider

Many insurance companies provide big discounts to carriers who share ELD data with them. With the ELD requirments set by the FMCSA, your insurance company can use the data that is usually shared through the ELD providers API key and can be sent directly to the insurance company to maintain the discount. Some insurance providers offer up to 10% off annually on plans that share ELD data. This is a huge insurance discount that can save carriers thousands per year on their trucking insurance cost.

Switching to an ELD provider that has the capability to share data with third parties through an open API can save so much on truck insurance that it more than pays for the entire ELD system. This type of data sharing allows insurance providers to have the confidence to provide steep discounts.

8. Ask if your provider accepts video telematics

Video-based telematics using dashcams is becoming more popular each year. Video allows drivers to keep recorded proof of accidents and can exonerate drivers who were not at fault for an accident. Video telematics also allows carriers to coach drivers which has an impact on CSA scores that also drive insurance costs down.

Exploring web-enabled dash cams and video telematics can provide as much discount for carriers as sharing ELD data. As dashcams become more accepted they will certainly have an impact on what a carrier will expect to pay for their truck insurance.

 

Topics: ELDs, Insurance

Mike Riegel

Written by Mike Riegel