Business Insurance for Freight Brokers and Forwarders

Business driving and personal driving are covered under different insurance policies.

To be fully protected, you'll need both types of auto liability coverage for your truck:

• Commercial auto insurance pays for legal defense costs if you get into an accident while driving your company truck for work purposes. It's required by state law for vehicles owned by a business.
• Personal auto insurance provides coverage while you're driving for personal reasons unrelated to your job.

If you drive your own vehicle for work purposes, you should consider hired and non-owned auto insurance (HNOA). This policy provides liability insurance for personal, rented, and leased vehicles used by your business. This is an affordable option that you can add to your general liability policy as an endorsement, but it doesn't include physical damage coverage.

Whichever policy you buy, you'll need to carry enough coverage to meet your state's requirements for auto insurance. If your trucks cross state lines, then you'll also need to comply with Federal Motor Carrier Safety Administration (FMCSA) requirements, which might include cargo coverage.

Freight brokers and forwarders often buy other types of coverage as part of their risk management plan. Here are some of the top policies to invest in:

• Inland marine insurance covers property in transit or stored off-site. It's often necessary since commercial property insurance only covers items at your main location.
• Trailer interchange coverage provides physical damage coverage for trailers that you don't own in the event of an accident, theft, or vandalism.
• Non-trucking liability (NTL) insurance protects owner operators by insuring their truck when it's used for non-business purposes, such as a personal errand or driving home.
• Motor truck cargo insurance provides compensation in the event of cargo loss, theft, or damage. Freight brokers and forwarders often buy contingent cargo insurance in case a motor carrier's coverage isn't enough to cover a claim.
• A mobile equipment endorsement covers tractors, forklifts, and other non-auto mobile equipment while it's being driven on a public road.
• Surety bonds, similar to fidelity bonds, reimburse your clients if you fail to comply with regulations or the terms of a contract. However, this amount must be paid back to the insurer.
• Occupational accident insurance (OAI) covers costs when an independent contractor or owner operator is injured on the job. Similar to workers' compensation insurance, it covers medical expenses, disability benefits, and death benefits.

There are a few ways to save money on business insurance, while still getting the coverage you need:

• Compare rates from different insurance companies. You could contact each company separately, but it's easier with the help of an agent. TechInsurance helps you find affordable coverage with our easy online application that retrieves freight broker insurance quotes from top-rated providers.
• Bundle insurance products. When you buy policies from the same company, you can often combine different types of insurance for a discount. The most popular bundle is a business owner's policy.
• Customize your policy. Choosing lower limits or a higher deductible is an easy way to reduce your premium. However, make sure to choose limits that will cover a potential claim, and a deductible you can easily afford.

An insurance agent can help you find cost-saving bundles, choose the right policy limits, and make sure your coverage matches the needs of your freight business.