What You Need, What It Costs, and What to Watch For
Insurance is typically the second-largest expense for an owner-operator after fuel. You cannot legally operate without it, and FMCSA will not activate your authority without proof of filing. Here is exactly what you need and what you can expect to pay.
Required Coverages
Primary Liability (BIPD — Bodily Injury and Property Damage)
FMCSA minimum: $750,000. Most brokers and shippers require $1,000,000. This is the big one — it covers damage and injury you cause to others. Expect $500–$1,500/month depending on your record, equipment, and cargo type.
Cargo Insurance
Covers the freight you are hauling if it is damaged or stolen. Most brokers require $100,000 minimum. Cost: $50–$250/month depending on commodity.
Physical Damage
Covers your truck and trailer against collision, theft, fire, and other damage. Not federally required but required by most lenders if you have a truck note. Cost: $100–$300/month.
Bobtail / Non-Trucking Liability
Covers you when you are driving your truck without a trailer for personal or non-business use. Cost: $25–$150/month.
Optional but Worth Considering
Occupational Accident (Occ Acc)
If you are an independent contractor, you are not covered by workers comp. Occ Acc is your substitute — covers medical bills and lost income if you are injured on the job. Cost: $140–$210/month.
Umbrella / Excess Liability
Additional coverage above your primary liability limits. Worth considering for high-value freight or high-risk lanes.
What Affects Your Premium
- Driving record and claims history — one at-fault accident can dramatically increase rates
- Years in business — new authorities pay more
- Equipment age and value
- Commodity hauled — hazmat and high-value freight cost more to insure
- Operating radius and states traveled
- CSA scores
Total Annual Cost: What to Expect
A new owner-operator with their own authority should budget $12,000–$16,000/year for a full insurance package. Rates have risen 20–40% over the past five years. Shop multiple agents who specialize in trucking — a standard personal lines agent cannot get you the best rates.
Tips
- Never let your policy lapse — FMCSA will revoke your authority immediately
- Maintain a clean record — your loss ratio follows you for years
- Bundle coverages with one carrier when possible for discounts
- Ask about safety discounts — some carriers reward clean CSA scores