Commercial Trucking Company Insurance Requirements and Your Truck Accident Case
The Federal Motor Carrier Safety Act (FMCSA) Requires Motor Carriers to Have Minimum Levels of Liability Insurance Coverage. Find Out How These Trucking Insurance Regulations Affect Your Personal Injury Case
Whether the at-fault driver has sufficient liability insurance coverage often determines whether you have a personal injury case worth taking to trial.
This maxim applies to all tort claims, including intentional tort (assault, battery, etc.), and car crash cases.
But it’s more significant in truck accident cases, where the injuries and damages tend to be more severe.
Fortunately, the Federal Motor Carrier Safety Regulations (FMCSRs) mandate motor carriers that transport people, freight, and hazardous substances to carry significant insurance coverage.
This article explains these FMCSA insurance requirements for trucking companies and bus operators.
We hope you use this information to negotiate a better personal injury settlement for yourself or a loved one.
Read on to learn more.
And call one of our experienced truck accident lawyers if you have questions about your case: (804) 251-1620 or (757) 810-5614. Our law firm represents accident victims in Virginia and Maryland, including bus accident victims, those struck by 18-wheelers, and truck drivers hurt on the job who have workers compensation and third-party lawsuits. Let’s start your claim.
What is a Motor Carrier?
A business is a motor carrier if it transports passengers (people)or the goods or property of another (cargo/freight) for money.
The federal laws regulating commercial trucks and passenger buses include these people under the definition of a motor carrier:
- A motor carrier’s officer, agent, or representative
- Any employee responsible for hiring, training, supervising, assigning, or dispatching a driver
- Any employee who maintains, installs, or inspects motor vehicle equipment or accessories
As you can see, the FCMSRs cover all people and businesses involved in the interstate operation of commercial motor vehicles.
What Kind of Insurance Must a Trucking Company Have?
Federal regulations say a motor carrier must carry specific public liability insurance coverage levels. Otherwise, the motor carrier cannot legally operate a motor vehicle (including commercial trucks and buses).
This government policy requiring motor carriers, brokers, and freight forwarders to have specific insurance coverage or asset levels dates to the Motor Carrier Act of 1935.
President Franklin D. Roosevelt signed this law because of the hazards of large commercial trucks on highways.
The Act had a section titled Security for Protection of Public. It said:
No certificate or permit shall be issued to a motor carrier or remain in force, unless such carrier complies with such reasonable rules and regulations as the Commission shall prescribe governing the filing and approval of surety bonds, policies of insurance, qualifications as a self-insurer or other securities or agreements, In such reasonable amount as the Commission may require, conditioned to pay, within the amount of such surety bonds, policies of insurance, qualifications as a self-insurer or other securities or agreements, any final judgment recovered against such motor carrier for bodily injuries to or the death of any person resulting from the negligent operation, maintenance, or use of motor vehicles under such certificate or permit, or for loss or damage to property of others. The Commission may, in its discretion and under such rules and regulations as It shall prescribe, require any such common carrier to file a surety bond, policies of insurance, qualifications as a self-insurer, or other securities or agreements, In a sum to be determined by the Commission, to be conditioned upon such carrier making compensation to shippers and/or consignees for all property belong [sic] to shippers and/or consignees, and coming into the possession of such carrier In connection with Its transportation service. Any carrier which may be required by law to compensate a shipper and/or consignee for any loss, damage, or default for which a connecting motor common carrier Is legally responsible shall be subrogated to the rights of such shipper and/or consignee under any such bond, policies of insurance, or other securities or agreements, to the extent of the sum so paid.
The following year – 1936 – the Interstate Commerce Commission wrote specific regulations requiring motor carriers to have liability insurance.
Years later President Jimmy Carter signed into law the Motor Carrier Act of 1980. This law deregulated the trucking industry; however, the requirements that motor carriers have liability insurance coverage remained.
Indeed, the current U.S. Code (49 USC Section 13906) says:
The Secretary [of Transportation] may register a motor carrier …. only if the registrant files with the Secretary a bond, insurance policy, or other type of security approved by the Secretary, in an amount not less than such amount as the Secretary prescribes pursuant to, or as is required by, sections 31138 and 31139, and the laws of the State or States in which the registrant is operating, to the extent applicable. The security must be sufficient to pay, not more than the amount of the security, for each final judgment against the registrant for bodily injury to, or death of, an individual resulting from the negligent operation, maintenance, or use of motor vehicles, or for loss or damage to property ….
Further, the Bus Regulatory Reform Act of 1982 set minimum financial responsibility limits and insurance requirements on vehicles transporting large numbers of passengers.
What is Public Liability Insurance Coverage?
The Federal Motor Carrier Safety Regulations (FMCSRs) define public liability as liability for bodily injury, property damage, or environmental restoration.
Environmental restoration includes payment for the loss, damage, or destruction of natural resources (including wildlife, fish, and shellfish) because of discharge or release of the cargo.
Why Does the Federal Government Require Motor Carriers to Have Insurance or Prove Financial Responsibility?
The insurance requirements for commercial trucks and buses have several purposes:
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- Promote highway safety by keeping “truckers who might have little concern for the safe operation and maintenance of their vehicles” off the roads.
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- Create incentives for motor carriers to keep and run their trucks and buses safely.
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- Ensure adequate compensation for those injured by commercial trucks or traveling by bus.
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- Reduce the pressure that safe motor carriers may feel to cut costs to meet the prices of competitors who cut costs by violating minimum trucking safety standards.
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- Make up for the U.S. Department of Transportation’s (DOT’s) inadequate funds and personnel to enforce safety regulations.
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- Protect trucking companies from dishonest or financially unstable brokers and freight forwarders.
What Type of Commercial Motor Vehicle Insurance is Required by the FMCSA?
The amount of liability insurance a motor carrier must have for a vehicle depends on three things:
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- The vehicle’s size
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- The vehicle’s cargo (hazardous vs. nonhazardous)
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- Where the vehicle operates (interstate, foreign, or intrastate commerce)
Here is a list of how much liability insurance a motor carrier must have by type of vehicle:
Commercial Trucking Insurance Requirements (for Freight and Cargo Vehicles)
| Type of Vehicle | Cargo | Insurance Coverage |
| (1) For-hire vehicle (in interstate or foreign commerce) weighing 10,0001 or more pounds | Property (nonhazardous) | $750,000 |
| (2) For-hire or private vehicle (in interstate, foreign, or intrastate commerce) weighing 10,001 or more pounds | Hazardous substances, as defined in 49 CFR 171.8, transported in bulk in cargo tanks, portable tanks, or hopper-type vehicles with capacities in bulk; in bulk Division 1.1, 1.2 or 1.3 materials; in bulk Division 2.3, Hazard Zone A material; in bulk Division 6.1, Packing Group I, Hazard Zone A material; in bulk Division 2.1 or 2.2 material; or highway route controlled quantities of a Class 7 material, as defined in 49 CFR 173.403 | $5,000,000 |
| (3) For-hire or private vehicle carrying in any quantity in interstate or foreign commerce, or carrying in bulk only in intrastate commerce, and weighing 10,001 or more pounds | Oil listed in 49 CFR 172.101; hazardous waste, hazardous materials, or hazardous substances defined in 49 CFR 171.8 and listed in 49 CFR 172.101, but not mentioned in entry (2) or (4) of this table | $1,000,000 |
| (4) For-hire or private vehicle in interstate or foreign commerce weighing 10,001 pounds or less | In bulk Division 1.1, 1.2, or 1.3 material; in bulk Division 2.3, Hazard Zone A material; in bulk Division 6.1, Packing Group I, Hazard Zone A material; or highway route controlled quantities of a Class 7 material as defined in 49 CFR 173.403 | $5,000,000 |
Insurance Requirements for Carriers of Passengers
| Vehicle Seating Capacity | Minimum Insurance Limits |
| (1) Any vehicle with a seating capacity of 16 passengers or more, including the driver | $5,000,000 |
| (2) Any vehicle with a seating capacity of 15 passengers or less, including the driver | $1,500,000 |
These FMCSA insurance requirements may also apply to transit providers in your state. You will have to see who funds the transit provider and what other motor carriers connect to the entity’s route.
Are These Motor Carrier Insurance Limits High Enough?
No – in our opinion.
These limits give sufficient coverage for many truck crash victims.
But these amounts are often insufficient for catastrophic injury cases. For example, personal injury damages often exceed $750,000 when they involve a spinal cord injury (paralysis), traumatic brain injury (TBI), amputation, burn injury, or wrongful death.
Can Motor Carriers Have More Liability Insurance Coverage than the Law Requires?
Yes.
Federal insurance regulations set the floor for how much liability coverage a freight or bus company must have.
But motor carriers can buy insurance with higher policy limits. And many do.
Indeed, we have helped trucking accident victims collect damages from excess and umbrella insurance policies that kicked in after the underlying liability insurance coverage paid the claim.
How Can I Find How Much Insurance Coverage the At-Fault Motor Carrier Has?
Proof that a motor carrier has the minimum levels of insurance required by law is public information.
A motor carrier must produce this proof to anyone who asks after receiving a reasonable request.
In addition, a motor carrier must keep the documents listed below at its principal place of business:
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- Form MCS-90 from the insurer (officially called the Endorsement(s) for Motor Carrier Policies of Insurance for Public Liability Under Sections 29 and 30 of the Motor Carrier Act of 1980) or Form MCS-90B under the Bus Regulatory Reform Act of 1982;
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- Form MCS-82 from a surety (officially called the Motor Carrier Surety Bond for Public Liability Under Section 30 of the Motor Carrier Act of 1980) or Form MCS-82B under the Bus Regulatory Reform Act of 1982; or
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- A written decision, order, or authorization from the Federal Motor Carrier Safety Administration authorizing the motor carrier to self-insure if it keeps a satisfactory safety rating.
Do States Require Motor Carriers to Have Liability Insurance?
Federal laws control when they conflict with state laws. The U.S. Constitution’s Supremacy Clause says so.
But states may pass laws about trucking insurance and require motor carriers to have more liability coverage than federal law requires.
For example, Section 46.2-2143.1 of the Code of Virginia lists insurance requirements for motor carriers operating in the Commonwealth.
This statute requires freight-carrying trucks running in intrastate commerce and weighing more than 7,500 pounds but less than 10,000 pounds to have at least $300,000 in liability insurance.
The Truck Crash Caused Damages Greater than the Insurance Amounts. Can I Get More Money?
Yes.
You may negotiate a truck accident (or bus accident) settlement for more than the liability insurance coverage.
Similarly, you can file a civil action (also called a complaint or lawsuit) alleging various causes of action (including negligence) that asks for more than the trucking company’s (or bus company’s) insurance coverage.
And the judge or jury may award it.
And you may be able to collect it depending on the motor carrier’s finances.
Inadequate insurance coverage, however, creates problems if the at-fault motor carrier does not have assets to pay for a verdict above the insurance amount.
What Happens if a Motor Carrier Violates the Law Governing Insurance Requirements?
The penalty for not having adequate insurance adds up.
A motor carrier that knowingly fails to have the levels of financial responsibility or insurance required by these rules may have to pay a maximum penalty of $19,933.
Although this may seem low for large companies carrying freight and passengers, each day that the motor carrier violates these rules constitutes a separate offense.
What if the Motor Carrier Has Less Insurance Coverage than the FMCSA Requires?
The law controls when a liability insurance policy conflicts with the statute governing minimum trucking insurance requirements to the injured person’s detriment.
Put This Knowledge of Commercial Trucking Insurance to Use and Get a Fair Accident Settlement
Dealing with an accident victim who knows how much insurance coverage is available to pay damages scares insurance claim adjusters.
The insurer would rather you have no idea how much money is available to make you whole – or as close as you can get after a truck crash.
We hope you use this information to build your case.
Or, if you want to focus on healing and leave the legal work to someone else, contact us for a free consultation.
We stand for truck accident victims throughout Virginia and Maryland and can help you win no matter what type of commercial truck or bus caused you harm.
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