Types of commercial truck insurance: which policy pays
A truck insurance program is several coverages stacked together, each written for one kind of loss. Knowing which one answers a claim, and which loss none of them answer, is the part most carriers learn too late.
Written by Rigo Diaz
Truck coverage in numbers
The types of commercial truck insurance coverage line up with the losses they pay: auto liability for injury and damage you cause others, physical damage for your own truck, cargo for the freight, and add-ons for towing, downtime, and injuries from uninsured drivers. Federal rules require only the liability, and only of certain carriers.
A truck insurance program is a stack of separate coverages, each written for a different kind of loss. The trouble starts when a carrier assumes one of them pays for something it was never written to cover, like the income lost while a truck sits in the shop.
I spent more than six years in risk management before I founded Simplex, and I have led it for more than 25 years since. This guide maps each type of coverage to the loss it pays, then goes deeper on the ones carriers misread most: physical damage, towing, downtime, and injuries caused by uninsured drivers.
The full briefing, read aloud
8 chapters. Select one to jump to it.
Generated with AI text-to-speech from this article's key insights, in order, rather than reading it word for word. Chapter times come from a transcript of the audio. The article itself was written and reviewed by Rigo Diaz.
Key takeaways
Start from the loss, not the policy name
Each coverage answers one kind of loss. A claim that fits none of them is yours to pay, however much premium you carry.
Federal law requires liability, not protection for you
For-hire interstate and hazmat carriers must carry public liability, from $750,000 to $5 million. Nothing federal requires coverage for your own truck.
Physical damage pays the repair, not the lost loads
The standard form pays the lesser of actual cash value or repair cost and excludes wear, breakdown, and road damage to tires.
Towing a tractor is not automatic
In ISO's 2013 business auto form, the built-in towing benefit applies only to private passenger vehicles, so a heavy truck needs towing written in.
Downtime is an add-on you choose in advance
Neither liability nor standard physical damage pays your lost income. It takes a rental reimbursement or downtime endorsement, bought before the loss.
In this articleContents
What types of commercial truck insurance coverage are there?
There are about ten common types of commercial truck insurance coverage, and each pays for one kind of loss. The fastest way to see what you have, and what you lack, is to start from the loss and find the coverage that answers it.
| The loss | Coverage that pays | Who requires it |
|---|---|---|
| Injury or damage your truck causes to others | Primary auto liability | Federal law for for-hire interstate and hazmat carriers; state law |
| Damage to your own tractor or trailer | Physical damage: comprehensive or specified causes, plus collision | Your loan or lease contract, if it says so |
| Loss of or damage to the freight | Motor truck cargo | Federal law only for household goods carriers; shipper and broker contracts |
| Damage to a trailer you pull but don't own | Trailer interchange or hired auto physical damage | Your interchange or rental agreement |
| Your truck used off dispatch while leased on | Non-trucking liability | Your lease with the carrier |
| Claims from your premises and operations, not driving | Commercial general liability | Customer and facility contracts |
| Your injuries caused by an uninsured or underinsured driver | Uninsured and underinsured motorist (UM/UIM) | State law, often included unless you reject it |
| Medical bills after a crash, whoever caused it | Personal injury protection or medical payments | State law where PIP applies |
| Income lost while the truck is being repaired | Rental reimbursement or downtime endorsement | No one: optional |
| Employees hurt on the job | Workers' compensation | State law, which varies |
Several rows have their own guides: trailers in semi trailer insurance, freight in motor truck cargo insurance, and where general liability ends and auto begins in general liability vs auto liability. What each line costs is covered in how much semi truck insurance costs.
Which types of coverage does federal law require?
Federal law requires only public liability, and only of for-hire carriers hauling property across state lines and of carriers hauling hazardous materials. Private carriers of non-hazardous freight fall outside these federal minimums, though state law still applies.
- $750,000 for for-hire general freight in vehicles of 10,001 pounds or more.
- $1 million for oil and most other hazardous materials.
- $5 million for certain bulk hazardous substances and the highest-hazard materials.
Carriers with operating authority prove that coverage through filings with FMCSA, and federal rules add a cargo filing only for household goods carriers, under 49 CFR 387.301T. Nothing federal requires coverage for your own truck, your own injuries, or your lost income. The order of filings for a new authority is in our guide to insurance for new trucking companies.
How does physical damage coverage work on a truck?
Physical damage pays for direct and accidental damage to your own truck, whoever caused it. ISO's standard business auto form offers it in three parts, and your declarations show which ones apply to which trucks.
- Comprehensive: any cause except collision or overturn, such as theft, fire, hail, or vandalism. Glass breakage and hitting an animal fall here too.
- Specified causes of loss: a cheaper alternative that pays only for named causes: fire, lightning, explosion, theft, windstorm, hail, earthquake, flood, mischief, vandalism, and the sinking, burning, collision, or derailment of a ship or train carrying the truck.
- Collision: impact with another object, or overturn.
What it pays, and what it doesn't
The most the standard form pays is the lesser of the truck's actual cash value or the cost to repair or replace it with like kind and quality, minus your deductible. On a total loss, the insurer adjusts for depreciation and condition, so an older tractor can pay out well below what you still owe on it.
It excludes damage due and confined to wear and tear, freezing, and mechanical or electrical breakdown, plus blowouts, punctures, and other road damage to tires. It also excludes any drop in resale value after a repair, and most portable electronics, such as a tablet, unless they meet narrow exceptions for equipment installed in and powered by the truck.
Towing is not automatic for a tractor
In ISO's 2013 business auto form, the built-in towing and labor benefit applies only to vehicles of the private passenger type. Check whether your declarations show towing for each truck and at what limit. Our physical damage coverage page lists what we place for tractors and trailers.
Does downtime fall under liability or physical damage?
Neither, under the standard forms. Your liability coverage pays other people for harm you cause, and standard physical damage pays to fix or replace your truck, not the loads you miss while it is in the shop.
The two income-related extensions in ISO's business auto form are narrow. Transportation expenses apply only after the total theft of a private passenger vehicle, and loss of use expenses apply only to a vehicle you rented without a driver. Neither pays a tractor owner for days off the road.
Rental reimbursement and downtime endorsements
To cover lost time, you add it before the loss, as a rental reimbursement or downtime endorsement or a separate policy, where your insurer offers one. Before you rely on it, read four terms:
- Trigger: whether it pays only after a covered physical damage claim.
- Daily amount: a rental bill paid, or a fixed sum per day.
- Waiting period: how many days the truck must be down before payments start.
- Maximum: the most days or dollars it pays per loss.
When another driver caused the crash
Your downtime is then part of your claim against them. ISO's standard definition of property damage includes "loss of use of tangible property," so the at-fault driver's liability coverage can answer for it, within their limits and what your state allows you to recover. Keep the repair dates, the loads you turned down, and your recent settlements to prove the loss.
What do UM/UIM and PIP cover for a truck driver?
Uninsured and underinsured motorist coverage lets you collect from your own insurer when a driver with no insurance, or too little, injures you. IRMI describes it as paying as if your policy provided liability coverage for the at-fault driver. Some states extend it to property damage.
These coverages are set by state law, not federal. Texas is a typical example: an auto liability policy there must include UM/UIM and personal injury protection unless a named insured rejects them in writing, and once rejected they stay off renewals with the same insurer until you ask for them in writing. Texas PIP pays regardless of fault, and the law does not require insurers to offer more than $2,500 per person.
Rejecting them saves premium, but your federal liability limit protects the public, not you or your driver. Injuries to employees on the job fall under workers' comp, covered for Texas in our guide to workers' comp for truck drivers.
How to check which types of coverage you actually have
Lay your declarations page next to the table above and work through it once a year, and again whenever your work changes.
Step 1: List the losses you couldn't absorb
A totaled tractor, a heavy tow, a month without loads, an injured driver. Each one should point to a coverage, or to cash you have set aside.
Step 2: Find each coverage and its symbol
Each coverage on the declarations carries its own covered auto symbol, so a truck can be covered for liability and not for physical damage. Our guide to commercial auto symbols explains how to read them.
Step 3: Read the physical damage limits
Confirm the deductible, how a total loss is valued, and whether towing is listed for each truck.
Step 4: Match contracts and leases
Collect every broker agreement, shipper contract, interchange agreement, and lease, and mark which coverage each one demands.
Step 5: Decide on downtime before you need it
If one truck down for a month would stop your revenue, price a downtime endorsement now. It cannot be added after the loss.
How Simplex helps you choose the right types of coverage
We start from how you run, what you haul, and what your contracts ask for, then build the coverage around it.
One program, every coverage
As a broker, we quote and place commercial truck insurance, from auto liability and cargo to the add-ons that keep a loss from stopping your business.
Protection for your own truck
Our physical damage coverage protects the tractor and trailer you paid for, and a licensed agent can walk you through deductibles, towing, and downtime options.
Leased to a carrier
If you haul under someone else's authority, non-trucking liability is built for the time your truck is off dispatch.
Frequently asked questions
What types of insurance does a trucking company need?+
Does downtime fall under liability or physical damage?+
How can an owner-operator get downtime compensation?+
Is bobtail insurance the same as non-trucking liability?+
Does physical damage insurance cover a blown tire or engine failure?+
Where this information comes from
The federal requirements below come from FMCSA's regulations in 49 CFR Part 387, the coverage wording from ISO's standard business auto form, and the state example from the Texas Insurance Code, all checked on October 20, 2026. Insurers can change standard wording by endorsement, so confirm your own policy with your agent.
-
1
49 CFR 387.9, Financial responsibility, minimum levels
The $750,000, $1 million, and $5 million public liability minimums by cargo.
-
2
49 CFR 387.3, Applicability
Which carriers the federal minimums apply to: for-hire interstate property and hazmat carriers.
-
3
49 CFR 387.301T, Surety bond, certificate of insurance, or other securities
Liability filings for carriers with authority, and the cargo filing required only of household goods carriers.
-
4
ISO Business Auto Coverage Form CA 00 01 10 13 (County of Sonoma copy)
Physical damage options, towing, transportation and loss of use extensions, exclusions, limits, and the property damage definition.
-
5
Texas Insurance Code, Chapter 1952
UM/UIM and personal injury protection included unless rejected in writing; the $2,500 PIP amount; PIP paid regardless of fault.
-
6
IRMI, uninsured motorists coverage
What UM coverage pays and how it works.
-
7
IRMI, underinsured motorists coverage
How UIM applies when the at-fault driver's limits are too low.
-
8
IRMI, bobtail liability
Bobtail liability as coverage for an owner-operator's truck when not used for trucking.
Written by
Rigo Diaz
Founder & CEO, Simplex Group
Founder and CEO of Simplex Group, with more than 25 years leading the company and helping trucking entrepreneurs navigate compliance, insurance, and the day-to-day demands of running a carrier. Before founding Simplex, he spent more than six years in risk management, experience that continues to shape how he approaches insurance, compliance, and carrier risk today.
Published · Updated
Related articles and services
Buy coverage for the losses you can't absorb
Every type of coverage on your policy should answer a loss you could not pay for yourself. The ones that matter most, like towing and downtime, have to be in place before the truck stops.
If you want a second look at which losses your current program leaves with you, talk to our team.