Insurance that Fits

Overdrive Staff | August 05, 2011

Independent agents like Roemer Insurance (, C.M. Brown & Associates (based in Perryville, Mo.; (573) 547-4508) and True North can give an operator access to dozens of competing insurance carriers, plus the benefit of dealing with a single person on a claim. “We’re the bridge between the insurance carriers and owner-operators,” says Gabe Hotop, with C.M. Brown. Hotop worked with Overdrive 2010 Trucker of the Year Mike Crawford when he transitioned from being leased to Prime Inc. to running under his own authority and dedicated to Prime.

If you’re getting insurance where you’re leased, Tillman notes that volume pricing may dictate good rates for the group policy. Brackey says, however, for operators with good maintenance and driving records, it may make sense to buy an individual liability and damage policy.

“Rates can vary a lot between companies,” says Progressive Commercial Auto Marketing Director Mike Miller ( While Progressive is one of the few insurers that sells direct to operators, Miller also promotes independent agents. The company works “closely with a sub-segment of agents who specialize in serving the needs of owner-operators. If an owner-operator chooses to purchase insurance from Progressive through an agent or directly from the company, he or she will receive the same quoted rate.”

1st Guard Insurance Company (, however, believes its direct-write model for physical damage insurance benefits owner-operators “because we are not paying agents the normal 15 to 25 percent commission,” says Wilson. “We do not work through agents/brokers.”

Wake-up call for new independents

One of the biggest changes for an owner-operator transitioning from a leased operation to running under his own authority is insurance costs. Operator Mike Crawford found this out last year. Leased to Prime, he’d bought into the company’s group policy for bobtail insurance and paid $32 a month, he says. Physical damage insurance on his 1994 Freightliner, bought through the Owner-Operator Independent Drivers Association’s insurance program, ran him around $65 a month. The total $1,154 he paid yearly for those coverages is a small fraction of the $5,600-plus he now pays for liability and damage with his own authority.

The big difference is in the typical $1 million worth of liability coverage. “Where non-trucking liability will run $400 to $500 a year” in premiums, says Gabe Hotop, with independent insurance agent C.M. Brown & Associates,“ primary liability will be $4,000 to $5,000 a year.” Canal Insurance’s Paul Brocklebank says, “Our single power-unit range is between $4,000 and $7,000 for preferred to standard risk.”

It’s a cost more operators may face if more carriers shift from leasing owner-operators to working instead with subcontracted owner-operators who have their own authority. Rudolph Freight Systems of Murray, Ky., formerly a dry freight motor carrier, now operates under a Freight Forwarder DOT authority and contracts with independents. Company founder Robbie Rudolph says his approximately 100 independents work “with an agreement with us to be dedicated carriage.”

They also handle all their own primary liability insurance. Rudolph says the company has been able to arrange a settlement deduction program via True North Insurance, in this case with a policy written for each individual operator rather than as a group. “A one-truck operator really wants to run and make money,” says Rudolph. “We want to take safety and insurance concerns off of him as much as we can. We’re the intermediary hooking him up with” insurers and safety consultants.

Participating in the settlement deduction program for dedicated operators avoids the need for a 15 percent to 25 percent down payment on yearly liability premiums, says Rudolph. The company pays its providers weekly and deducts insurance costs weekly.

More Insurance Tips

• Mind the deductible. You can raise your policy’s deductible to lower the premium, but independents should beware, warns Mike Lawrence with agency Roemer Insurance. “I always tell my clients to take the lowest deductible that you can afford. If you have a $2,500 deductible on the tractor and the trailer and cargo insurance, and it all comes into play in a loss, $7,500 adds up fast.” If you’re leasing to a carrier, read the lease carefully. Some will hold the operator responsible for a certain amount of carrier liability or cargo deductibles in a loss. For instance, says owner-operator Rick Ash about his carrier, “If they deem me responsible for freight damage due to negligence, it is written into my lease that they can hold me responsible for the first $1,500 of the claim.” strives to maintain an open forum for reader opinions. Click here to read our comment policy.