Hot Shot Trucking Insurance: Types, Costs, & Tips | ACV Auctions (2024)

Hot Shot Trucking Insurance: Types, Costs, & Tips | ACV Auctions (1)

Hot shot trucking is an excellent way to build your experience in shipping and hauling—and create a lucrative career in a fast-growing industry. But before you invest in a truck and start looking for hot shot loads to haul, you’ll want to make sure you have the proper protections.

Hot shot trucking insurance is a key part of staying legal and compliant on the road. Not only will you want to protect yourself in the case of an unexpected emergency or accident, but you’ll also want to know that your clients are safe.

The risks of hitting the road without proper coverage are too great to ignore. Read on to get an idea of what to expect with hot shot trucking insurance, including what types of hot shot trucking insurance exist and how to find the right coverage for your needs.

What Is Hot Shot Trucking Insurance?

If you drive, you know that you need to carry some kind of insurance coverage to legally operate a vehicle. The same goes for hot shot truckers, but the specific insurance requirements may differ depending on your state and the type of cargo you haul.

Hot shot trucking refers to hauling time-sensitive loads that are too small to fill an entire semi-truck trailer.

These hot shot loads often need to be delivered quickly and require specialized equipment, such as flatbed trucks or gooseneck trailers. As a result, unique risks are associated with this type of work, requiring specialized insurance coverage.

Types of Hot Shot Trucking Insurance

You’d be surprised to learn that hot shot trucking isn’t covered by standard commercial truck insurance. Instead, you’ll need to purchase a specific type of coverage​​​​​​​ tailored to the risks involved in hot shot hauling.

Primary Liability Insurance

Primary liability insurance is the most critical coverage for hot shot truckers. It protects you financially if you're found at fault for an accident that causes property damage or bodily injury to others. The FMCSA requires a liability coverage minimum of $750,000, but many shippers and brokers—including ACV—require $1 million or more in liability to ensure adequate protection.¹

When choosing your liability coverage limits, consider the potential costs of a severe accident, including medical expenses, legal fees, and damages. While higher limits may result in higher premiums, the financial protection they offer can be a lifesaver in the event of a catastrophic incident.

Cargo Insurance

While cargo insurance isn't legally mandated, it's a worthwhile purchase for most hot shot truckers. This coverage protects your transport goods against damage, theft, or loss during transit. Most shippers and brokers require you to carry cargo insurance, with the average minimum requirement being $100,000.²

However, the required coverage limit can vary significantly based on the type and value of the cargo you're hauling. High-value or sensitive goods may necessitate higher limits to ensure full protection. Be sure to discuss your specific cargo insurance needs with your provider to get adequate coverage.

Physical Damage Insurance

Your truck and trailer are the lifeblood of your hot shot trucking business and represent a significant financial investment. While not legally required, physical damage insurance is a wise choice to protect these valuable assets from any damage caused by accidents, theft, vandalism, and other risks.

This coverage can help cover the cost of repairing or replacing your equipment in the event of a covered loss, minimizing the financial impact on your business. When selecting physical damage coverage, consider the value of your truck and trailer, your financial situation for handline repairs or replacement costs, and the level of risk you're comfortable with.

Non-Trucking Liability Insurance

If you're an owner-operator leased to a motor carrier, you'll need non-trucking liability (NTL) insurance to cover you when you're not under dispatch.³ This coverage kicks in when you're using your truck for personal reasons outside your business.

NTL insurance protects you from liability claims arising from accidents during these personal use periods. It's important to note that NTL coverage typically doesn't apply when you're under dispatch or conducting business-related activities, as those situations would be covered by your primary liability insurance.

Factors Affecting Hot Shot Insurance Costs

Just like your regular vehicle insurance, some factors affect how much you will pay for hot shot insurance. These can include:

  1. Driving Experience: Insurance companies often offer lower premiums to drivers with more experience and clean driving records.
  2. Type of Cargo: Hauling hazardous materials or high-value goods can increase insurance costs.
  3. Equipment Value: The worth of your truck and trailer will impact your physical damage coverage premiums.
  4. Operating Radius: Larger operating areas generally translate to higher insurance rates, as there's a greater risk exposure.
  5. Coverage Limits and Deductibles: Higher liability limits and lower deductibles will result in increased premiums.

On average, hot shot trucking insurance can cost between $7,000 and $12,000 annually per vehicle, with owner-operators paying slightly less depending on several factors.⁵ You’ll want to do thorough research to find the best provider.

Tips for Finding Hot Shot Insurance

When searching for the best hot shot trucking insurance, it's essential to work with an experienced provider that will find the right coverage for your business. Look for a company specializing in commercial trucking insurance with a proven track record of serving hot shot truckers.

Get and compare quotes from multiple providers and carefully review the coverage options, limits, and deductibles. Don't be afraid to ask for specifics on any policy aspects you don't fully understand.

It might be tempting to the cheapest policy available, but ensuring adequate coverage to protect your business and comply with regulations is vital. After all, you’ve worked hard to build this business, so don’t take any unnecessary risks.

Team Up With ACV Transportation

Having the right insurance is only one step to building a successful hot shot trucking business. You also need to have the right truck, the best routes, and the most up-to-date information on industry trends.

With ACV Transportation you can tap into hundreds of car dealerships that are looking for hot shot transport each day. Sign up to join our free load board.


Sources

  1. Federal Motor Carrier Safety Administration. (2024). Financial Responsibility Study. Retrieved from https://www.fmcsa.dot.gov/sites/fmcsa.dot.gov/files/docs/Financial-Responsibility-Study.pdf
  2. Marquee Insurance Group Editorial Team. (2024). Hauling for a Freight Broker: What You Need to Know. Marquee Insurance Group. Retrieved from https://www.marqueeig.com/resources/hauling-for-a-freight-broker/
  3. Commercial Insurance Solutions Editorial Team. (2024). Non-Trucking Liability Insurance. Commercial Insurance Solutions. Retrieved from https://commercialinssolutions.com/non-trucking-liability-insurance/
  4. TruckInfo Editorial Team. (2024). Bobtail Insurance Guide. TruckInfo. Retrieved from https://www.truckinfo.net/guide/bobtail-insurance#what
Hot Shot Trucking Insurance: Types, Costs, & Tips | ACV Auctions (2024)
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