How Can Trucking Company Owners Reduce their Insurance Rates?

Semi Truck insurance is an expense that is unavoidable for fleet owners as well as independent owner-operators. The most annoying part of this expense is that rates are increasing almost every year. Even a minor claim can see your rates increased by as much as 20%. What's even worse is the fact that certain insurance conditions are also hidden. 

These reasons can often make cost management more difficult. While there is no way of avoiding insurance, there are ways in which you can reduce the cost. There are many factors considered by insurance providers when calculating your commercial trucking premiums. Knowing these factors can help you reduce your overall insurance costs. 

How Much Does Semi Truck Insurance Cost?

By estimation, leased semi trucks are commonly charged about $3000 to $5000 annually. Truck owner-operators working under their authority are charged between $9000-$12000 per annum. New authority owners can even be charged around $16000. 

Insurance agents also offer specific coverage types for different business needs. These can be:

  • Auto liability: avg cost $5,000
  • Non-trucking: avg cost $400
  • Occupational accidents: avg cost $1,600 to $2,000
  • Cargo insurance: avg cost $400 to $1800
  • Physical damage: avg cost $1,000 to $3,000
  • Workers' compensation: avg cost of $3,000 to $5,000
  • Trucker's general liability: avg cost $600

Here is How You Can Reduce Semi Truck Insurance Rates

  1. Employ Experienced Drivers

One of the key factors in determining insurance rates is driver experience. The better your driver profiles, the better your insurance rates. Consider hiring drivers with a minimum of 2 years of CDL experience. The reason is that insurance companies believe that an experienced driver would make fewer mistakes in difficult driving conditions, so they are considered a low-risk asset. Age is also an essential factor; too young is considered more reckless, and too old is considered riskier. The ideal age bracket for drivers is between 28 and 60.

  1. Company Age (Stay in Business)

One of the most effective ways to lower your trucking insurance costs is by staying in business. You must keep your business under the same authority and name. Insurance companies tend to give lower rates to businesses that have been established for a long time because new businesses are considered riskier to insure. 

  1. Keep a Clean DOT Safety Record

A DOT safety record shows how well your drivers and vehicles have complied with the rules and regulations set by the Federal Motor Carrier Safety Administration (FMCSA). Your insurance premiums are considerably lower when you have an excellent DOT record. 

Here are some common DOT violations that can raise your insurance rates:

  • Poorly maintained vehicles
  • Vehicle inspection not adequately done
  • Drivers have a record of drug use or alcohol
  • Transporting hazardous materials
  • Drivers not having proper qualifications
  1. Employ Drivers with Clean Records

When employing drivers be sure to check their driving history. Insurance companies will consider them high-risk if they have several accidents or misdemeanors, increasing insurance costs. 

  1. Keep Higher Deductibles in Consideration

If all else fails, consider higher deductibles which will lower insurance rates. But the downside is that you must bear higher costs upfront if an accident occurs. So, if you plan to go down this route, choose a deductible that won't strain your budget. This works best for companies with very few accidents, so study your accidental history to see if this option is viable for your business. 

  1. Use Newer Trucks

Your trucks' value, condition, and age play a massive role in calculating trucking insurance costs, and technology is also a determining factor. If your semi-truck has accidental avoidance technologies like motion-censored braking, reverse cameras, collision warning systems, etc., you can expect a better insurance rate. 

Older trucks have gone through a lot of wear and tear in their years of service. They are more likely to cause an accident. Moreover, trucks older than 10 years are less likely to have advanced accidental avoidance technologies, so they are deemed riskier to insure. So it is best to use trucks no older than 10 years and have modern technologies enabled. 

  1. Your Routes Affect Insurance Rates

The roads your trucks drive on have a massive impact on your insurance rates. If, for example, most of your operations occur in metropolitan areas with dense traffic and population, then you have to pay higher insurance rates. Because the chances of having an accident increase considerably. 

Another factor is the probability of bad weather in the routes you cater to. If your routes include areas with a high probability of rain and snow, these slippery roads are considered riskier to insure.

If you have a small fleet and make long hauls regularly, this will also affect your premiums. The reason is that the insurance company would consider your drivers to be more tired and your trucks to require more maintenance as they spend more time on the road. More time on the road also increases the chances of accidents. 

If possible, try to split your routes to decrease the time each driver and truck spends on the road. For those with a small business, this may not be possible. You can also try to cater to loads in less populated areas and areas with fewer chances of unexpected weather changes.


  • Employ mature drivers with a good history.
  • Choose less risky routes.
  • Use newer trucks with accident avoidance technologies.
  • Get higher deductibles
  • Ensure you comply with Federal Motor Carrier Safety Administration (FMCSA) rules & regulations. 
  • Stay in business under the same authority.
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Sara Naveed is a creative and digital content writer who uses her creative skills to develop and edit professional web content. Being a writer has always been her dream. She earnestly hopes people appreciate her writing—an asset she deeply covets. Using her 8+ years of working experience, she writes for trucking industry experts who are always looking for better technological solutions to their problems.

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