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Semi-Truck Physical Damage Insurance

Below is our complete guide to semi-truck physical damage insurance. We cover the different types, what is normally covered, how much it costs, and more.

While not legally required, most semi-truck owners will want to purchase physical damage insurance to protect their vehicles.

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However, selecting the right policy isn’t always easy. There are multiple types of coverage and a long list of endorsements that truck owners need to navigate to make sure they have adequate protection.

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Below is our complete guide to semi-truck physical damage insurance. We cover the different types, what is normally covered, how much it costs, and more.

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For those just looking for a list of top companies, here are a few of our favorites.

Progressive

Call Get Quote
  • Best Overall

biBERK

Call Get Quote
  • Recommended for new trucking companies

The Hartford

Call Get Quote
  • Recommended for fleets

By clicking “Get Quote” or calling you will go to one of our insurance partners. The providers above may not be one of the providers in their network at this time.

What Is Physical Damage Insurance?

Physical damage insurance covers the repair or replacement of an owned vehicle in the event of a covered incident. The two most popular types of physical damage coverage are collision, which covers most road-related incidents, and comprehensive, which covers most other incidents. 


Physical damage insurance does not cover third-party property or personal injuries of any kind.

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While coverage is not required by law, it may be required by a lender when a truck purchase is financed. Lenders will provide a list of required coverage types and amounts.

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Even when not required, coverage is still recommended. According to the FMCSA, nearly 415,000 large truck collisions occurred in 2020. The cost of repair for collision damage (and business losses while repairs are completed) can be higher than most businesses can weather. Physical damage insurance helps to cover these costs and also protects against non-collision damage risks such as theft or vandalism. 

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Without insurance coverage, the costs of vehicle repair and lost business fall solely on the truck owner. Many business owners lack the savings necessary to cover these losses and without adequate coverage, a truck collision or theft can be a business-ending event.

Who Needs Physical Damage Insurance Coverage?

Physical damage insurance covers specific commercial vehicles, including semi-trucks and trailers, and is usually purchased by the owner of the vehicles.

Policy-holders can fall into one of these three categories:

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  • For-Hire Motor Carriers – Trucking companies that own a fleet of vehicles. Motor carriers that exclusively work with owner operators will not need to purchase physical damage coverage.‍
  • Owner Operators – These businesses are responsible for insuring their vehicles against physical damage. Owner operators who lease onto a motor carrier will receive primary liability insurance coverage through the motor carrier but will need to provide their own physical damage insurance.‍
  • Private Carriers – Defined by FMCSA as someone transporting their own cargo. Private carriers will insure the owned vehicles in their fleet.



Is Physical Damage Insurance Required by Law?

No, physical damage insurance is not required by law.


However, other forms of insurance are required. For instance, public liability insurance is mandated by the Federal Motor Carrier Safety Administration (FMCSA). Public liability insurance covers bodily injury, damage to property, and environmental restoration for third parties. The amount of required coverage depends on what is being transported but coverage requirements range from $750,000 to $5 million. 

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The FMCSA also requires household goods motor carriers to file proof of cargo insurance. Minimum coverage is $5,000 per vehicle and $10,000 per occurrence.

What Does Physical Damage Insurance Cover?

Physical damage insurance covers the cost of repairing or replacing a named truck and trailer after a covered incident. In the event the truck is totaled, the insurance pays out the actual cash value (ACV) for the vehicle.

Main Types of Coverage

There are two primary types of coverage – collision and comprehensive. Most companies will want both but here is a quick breakdown of the two:


  • Collision Insurance – This covers damage to a named truck and trailer caused by a collision or rollover.  The accident can involve another vehicle or an object but collisions with an animal are not normally covered. Plans that offer collision insurance tend to be more expensive than those offering only comprehensive insurance. Premiums are also more likely to increase after a claim. ‍
  • Comprehensive Insurance – This covers damage to a named truck or trailer caused by something other than a collision or rollover. Common examples of covered situations include damage from fire, vandalism, collision with an animal, or theft. 

Other Types of Coverage

Additional coverage options include: 


  • Fire and Theft with Combined Additional Coverage – This is sometimes purchased as a less expensive alternative to comprehensive insurance. However, the name can be misleading. This type of coverage is limited in scope and will only cover specific named events. For example, a policy may include hail damage protection, but no protection for fire damage. Premiums will likely be less than comprehensive coverage but an uncovered incident can result in large out-of-pocket expenses.‍
  • Gap Coverage – This pays the difference between the actual cash value (ACV) of the vehicle at the time of the incident and what is owed on the loan. ACV only reflects the vehicle’s value, not what is owed on a loan or what it would cost to replace the vehicle. For example, if a vehicle is totaled and the ACV is determined to be $20,000 but there is still $27,000 due on the loan, loan gap insurance would cover the remaining $7,000.

Endorsements & Riders

Endorsements, sometimes called riders, are additions to an insurance policy to fill coverage gaps or provide extra protection. Examples include:


  • Personal belongings coverage – Covers personal items inside the vehicle, such as clothing.‍
  • Electronic equipment coverage – Covers electronic components that have been added to the vehicle such as dash cams or GPS equipment. ‍
  • Increased towing limits – Provides more choice for where the vehicle is towed after an incident. For instance, towing may be covered to a repair garage of choice rather than the closest option.‍
  • Roadside assistance – Offers assistance and some minor repairs to take place on the road after a mechanical malfunction rather than towing for service. ‍
  • Rental truck coverage – Covers the cost of renting a replacement vehicle while a truck is in for repairs.‍
  • Glass coverage – Eliminates the need to cover the deductible when a windshield or mirror breaks.‍
  • Emergency expenses – Covers expenses such as extra lodging and transportation. 
  • ‍Downtime or lost income – Helps offset business losses while a truck is out of operation.

What Does Physical Damage Insurance Not Cover?

Physical damage insurance does not protect against all risks. The following items are not covered by most policies: 

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  • General Wear and Tear. If vehicle parts wear out, such as brake pads, the replacement of those parts is not covered.
  • ‍Medical Expenses. Whether for the driver, passenger, or third parties, medical expenses are not covered. 
  • ‍Lawsuit Fees. Legal fees in the event of a lawsuit are not covered.
  • ‍Personal Property. While coverage protects the truck and trailer, it does not protect any personal property inside the truck. Coverage for personal belongings can be added as an endorsement on some policies.
  • ‍Damage To Other Vehicles. Because this type of insurance only covers the truck and trailer, damage caused to other vehicles is not covered. Primary liability insurance is required to cover damage to third parties. 
  • ‍Cargo. Physical damage coverage does not protect against cargo losses.

How Much Does Physical Damage Insurance Cost for a Semi-Truck?

Physical damage insurance premiums are based on the value of the vehicle, with monthly premiums typically ranging between 2.5-5% of the vehicle’s value.


However, exact figures will vary based on several factors.

Cost Factors

  • Deductible – The amount that must be paid out of pocket before insurance kicks in. The higher the deductible, the lower the monthly premiums. However, it is important to select a plan with a deductible you can afford if an incident occurs.‍
  • Location – Different states and regions have different pricing impacted by local laws, taxes, and other risk factors.
  • ‍Operating Radius – Trucks operating across a larger geographic area tend to have higher premiums. 
  • ‍Vehicle Value – More expensive vehicles will have higher premiums.
  • ‍Age of the Truck – Older trucks generally result in lower insurance costs.
  • ‍Miles on the Truck – Similar to age, vehicles with high mileage often have lower insurance costs as the overall value of the vehicle decreases.
  • ‍Time in Business – Insurance companies are more likely to offer discounts and favorable rates to owners with longer business records. 
  • ‍Driving Record of the Truck’s Operator – For fleet owners, the record for all employed or contracted drivers will be considered.
  • ‍Coverage Options – A plan will become more expensive as additional coverage and riders are added. 

How To Get Cheap Physical Damage Coverage

There are several ways to save on insurance costs. Look out for the following:


  • Ask for discounts for paying premiums annually instead of monthly
  • Choose a plan with a higher deductible
  • Build and maintain a good credit score
  • Hire experienced drivers with clean driving records
  • Create a safety policy outlining accidents, drug or alcohol abuse, and other safety situations are handled
  • Make sure logbook and FMCSA data is accurate
  • Keep trucks up to date with current safety equipment, such as fog lamps
  • Consider dash cams for policy discounts and to document any incidents
  • Reduce claims by keeping trucks and trailers in secure areas
  • Comparison shop by receiving quotes from multiple insurance providers

Avoid chasing the lowest rate without considering coverage. It is important to balance monthly costs with the coverage needed to protect your business.

Other Insurance Requirements for Carriers & Owner Operators

The following types of insurance are recommended or required depending on the business.

For-Hire & Private Motor Carriers


  • Primary Auto Liability Insurance – This insurance covers accidental damage caused by the covered vehicle. For instance, this would cover personal injuries to another driver caused by a collision. Primary auto liability insurance is legally required. 
  • ‍Cargo Insurance – Reimburses the cost of damaged or lost cargo. This coverage is legally required for household goods motor carriers. Shippers and brokers will also require this coverage from their for-hire motor carriers.
  • ‍General Liability Insurance – This insurance offers additional coverage beyond primary auto liability coverage. Coverage includes workplace accidents, copyright infringement, and negligence. These policies are less expensive than the minimum required liability insurance, and provide useful additional protection. 
  • ‍Additional Coverage – Includes optional coverage additions. The most commonly selected coverage includes worker’s compensation, occupational accident insurance, trailer interchange or non-owned trailer, reefer breakdown, roadside assistance, and commercial property insurance.

Owner Operators


  • Non-trucking Liability or Bobtail Insurance – Non-trucking liability covers claims when a truck is used for non-commercial reasons while bobtail insurance specifically covers when the truck is driven separately from the trailer. An owner operator’s lease agreement with their motor carrier will require either non-trucking liability or bobtail coverage. For a detailed breakdown of the difference between these, see our guide to bobtail insurance.
  • ‍Occupational Accident Insurance – This coverage provides similar benefits to worker’s compensation for a motor carrier’s independent contractors. Some motor carriers provide this coverage on behalf of their contractors. When not offered by a motor carrier, the owner operator can opt to purchase this coverage directly.
  • Trailer Interchange Coverage – Owner operators that lease onto a motor carrier and use the motor carrier's trailer may be required to purchase trailer interchange to protect the carrier's equipment while in their possession.

Best Non-Trucking Liability & Physical Damage Insurance Companies

Choosing the right insurance coverage is an important decision with a lot of variables to consider so it is a good idea to get several quotes and carefully compare coverage and pricing before making a decision.

Progressive

Call Get Quote
  • Best Overall

biBERK

Call Get Quote
  • Recommended for new trucking companies

The Hartford

Call Get Quote
  • Recommended for fleets

By clicking “Get Quote” or calling you will go to one of our insurance partners. The providers above may not be one of the providers in their network at this time.

FAQs

  • Is physical damage the same as full coverage?

    No, physical damage is not the same as full coverage. Full coverage refers to a combination of policies that covers damage to a truck or trailer, the driver, and business liabilities. Physical damage only covers damage to the truck and trailer. Other damage, such as to third-party vehicles or cargo, is not covered.

  • Is physical damage the same as liability insurance?

    No, physical damage and primary liability are two different types of coverage. Primary liability insurance is legally required and covers damage to third parties and their property. Physical damage coverage is not legally required as it only protects owned trucks and trailers.

  • What are the two types of physical damage insurance?

    Collision and comprehensive are the two most common types of coverage. As the name implies, collision coverage protects against damage to a truck or trailer caused by a collision. Comprehensive coverage, on the other hand, covers damage caused by something other than a collision, such as theft or vandalism.