Hot Shot Trucking Insurance Requirements: The Best Insurance for Truckers?

Hot Shot Trucking Insurance Requirements: The Best Insurance for Truckers?

Are you an owner-operator of a trucking business? Are you a motor carrier with drivers? Do you ever find yourself with the need to use pickup trucks to expedite cargo delivery?

Couriers and other companies using pickups as delivery or transport vehicles rely on the pickup’s flexibility to help them navigate customer requirements.

Do you know about hotshot insurance? There are several hotshot trucking insurance requirements needed to open a policy. These policies offer you specific coverage for pickup trucks, allowing you to run your business knowing you have protection against any liability.

You get coverage against any third-party liability claim involving physical damage or bodily injury caused by accidents with your vehicles.

Hotshot insurance policies are like all other insurance policies for truckers. 

The policy builds on your existing primary liability cover, adding additional coverage for hot shot loads. It’s another form of insurance coverage, just like bobtail or cargo insurance.

With hotshot trucking insurance, you get cover for your pickup and peace-of-mind for your business. When things go wrong, you need to know you have the cover you need. Without the right insurance policies, you could end up settling a huge civil suit that bankrupts your business.

Why take the risk when hotshot insurance covers you for any problems you encounter hauling loads with your pickup? Hotshot insurance makes sense for any company using pickups in their fleet.

This post looks at hotshot trucking insurance requirements. We’ll unpack everything you need to know about applying for this cover for your business.

What are the Hot Shot Trucking DOT Regulations and Requirements?

Whether you’re starting a courier company or an established player in the trucking game, you need to understand the requirements for opening a hot shot trucking policy.

You’ll have to meet your insurance broker’s requirements and those set by the state and shippers as well. Some of the most commonly requested coverage requirements include the following.

  • Most brokers request at least $100,000 in cargo insurance, protecting your freight from loss, theft, fire, or damage.
  • While not always required by the insurer or broker, they often recommend you have coverage for physical damage to your pickup and trailer.
  • If you plan on crossing state lines with your load, you’ll require MC numbers. The limit of coverage needed to file an MCS 90 varies from state-to-state.
  • If you recently started operations, you’ll need the MCS-150 and BOC-3 filings.
  • The broker or insurer needs your IRP (International Registration Plan) registration for the pickup truck and the PTI (Permanent Trailer Identification).
  • Some states make it mandatory for drivers to have a CDL, while others don’t have it as a requirement.
  • Most freight brokers require a minimum of $1-million in primary liability coverage for your trucking business.

It’s important to note that hotshot trucking insurance doesn’t always require the trucker to have a Commercial Driver’s License (CDL). However, non CDL hotshot insurance tends to come with a higher monthly premium.

What Is the Hot Shot Trucking Startup Cost?

The startup costs for hotshot insurance for your trucking business are considerable. You’ll also have to jump through a few hoops to ensure you comply with regulatory and state requirements for your policy.

To start, you’ll need to open your business and get an Employer Identification Number (EIN).

After receiving the number, you’ll use it to open your business bank account. When you’re ready and set up, you’ll apply for a “Motor Carrier” (MC) number.

The MC number allows you to cross state lines with your cargo, and it also lets you designate BOC-3 agents representing you in any states where you operate.

However, the issue with activating an MC number is that it requires you to have commercial trucking insurance. Most insurers or brokers need at least $1-million in primary liability coverage and a minimum of $100,000 in cargo insurance policies.

Depending on your driver’s age, where you operate, and your risk profile, these policies could cost you anywhere from $1,000 to $2,500 per month. The process can take weeks for approval, so ensure you have the correct paperwork ready. Mistakes cause delays and waste time.

Using a broker helps you navigate the paperwork for federal, state, and authority permits. They also handle any state DOT regulations for your hot shot trucking requirements.

Your insurance’s annual costs are a significant business expense, and you could end up paying anywhere from $15,000 to $30,000 for your insurance policy.

What are the Hot Shot Trucking Rates Per Mile?

Typically, running hot shot loads is not as profitable as a truckload. However, the operating costs for hotshot divisions are considerably less than those for running a flatbed truck.

In most cases, hotshot rates are around $1,50 per mile. Charging $2 per mile won’t get you many customers at this rate.

If you’re delivering partial loads, rates could even be as low as $1 to $1.25 per mile. Most hotshot managers find they need to structure their loads to help the larger deliveries cover the deadhead costs.

When setting rates, you’ll need to account for the costs of running your fleet. Gas and maintenance add up, and you need to ensure your drivers are making the most of your resources.

Including vehicle and driver tracking in your expenses might cost you more, but your insurer might offer you a discount on your premiums for these add-ons.

Hot Shot Trucking Insurance – Is It Worth It?

If you find yourself needing to use your pickup to expedite cargo to clients, a hotshot policy is a must. This insurance gives you the freedom to remain flexible with your business, giving you mere freedom to use other forms of transport when you need it.

Sure, it might be another cost to add to your annual business expenses. However, think of the business it brings in when you can act fast in a crisis. The reality is that if you use your pickup to carry, you need hot shot insurance to cover your liability.

Hotshot insurance can benefit many businesses, from courier companies to owner-operators that use a pickup frequently in their operations. You need to decide if you need to cover the risk in your hot shot business. However, leaving your company unprotected against potential loss, accidents, or injury could end up costing you a lot more in the future.

Speak to a broker or insurance agent about how hotshot insurance can benefit your business and the costs involved with signing up. They’ll give you everything you need to know about the requirements for opening a hotshot insurance policy for your trucking business.

Hot Shot Trucking Insurance FAQ

Q: What insurance is needed for hot shot trucking insurance?  

A: You’ll need primary liability insurance as your base for your hot shot policy. According to the FMCSA, it requires a minimum of $750,000 in liability coverage for physical and property damage, bodily injury, and restoration post-accident. Your hotshot policy builds on this original policy, just like bobtail or cargo insurance.

Q: How much does hotshot insurance cost?

A: Hotshot truck insurance is one of the more affordable options out there. However, it’s still a significant investment and accounts for a large chunk of your annual business expenses.
All in, your hot shot trucking insurance expenses can be anywhere between the $15,000-$30,000 range, depending on your requirements.

Q: Is hot shot trucking insurance worth it?

A: Hotshot Insurance is an “A” rated insurance company trusted by millions of truckers across America.
Hotshot offers affordable premiums and excellent coverage, with plenty of separate custom policy additions, like bobtail and cargo insurance – Hot shot insurance covers your pickup when you need it

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