Running your transportation business means you're on the road constantly, handling valuable cargo and managing a fleet. These coverage types protect your operations from the costly risks you face daily.
What Insurance Do You Need For a Transportation Business?
Your transportation business needs commercial auto, workers' comp, cargo, and general liability insurance for comprehensive financial protection.
Get matched to the best transportation business insurance companies for your needs below.
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Updated: November 25, 2025
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Transportation Business Insurance Requirements: Key Takeaways
Commercial auto insurance tops the priority list for your transportation business given constant highway risks and federal mandates for interstate commerce authority. (Read More)
Federal law requires three core protections for your transportation company: vehicle liability, employee injury coverage, and environmental restoration insurance. (Read More)
Transportation operators should consider facility protection, equipment breakdown coverage, and third-party liability insurance beyond basic requirements.
Stay compliant by securing certificates immediately after purchase, completing federal filings, and proactively updating client documentation before renewals. (Read More)
What Insurance Types Are Needed For a Transportation Business?
Liability coverage for accidents involving your fleet, plus collision and comprehensive for vehicle damage. Protects you from lawsuits and covers costly vehicle repairs after crashes, theft or vandalism. | $1 million minimum for local delivery; $2 to $5 million for long-haul freight. Hazmat carriers need higher limits. | Your delivery driver rear-ended a sedan at a red light, causing $65,000 in medical bills and $15,000 vehicle damage. Commercial auto covered the full $80,000 claim with only your $1,000 deductible. | |
Cargo Insurance | Protects goods in transit from theft, damage or loss while under your control. Covers customer cargo you're legally liable for during transport. | $100,000 to $2 million per load based on cargo value. Most freight operations need $100,000 to $500,000 coverage. | Thieves stole $35,000 in electronics from your locked trailer overnight at a truck stop. Cargo insurance reimbursed the full loss, preventing customer lawsuits and contract cancellations. |
Covers injuries and property damage during loading, unloading and warehouse operations not related to driving. Protects against slip-and-falls and equipment damage at customer sites. | $1 to $2 million per occurrence for most operations. High-value clients may require $3 to $5 million coverage. | While delivering appliances, your crew damaged a customer's hardwood floors and broke a window, totaling $8,500. General liability covered repairs, maintaining your customer relationship. | |
Covers medical bills and lost wages for drivers injured in accidents, loading incidents or equipment malfunctions. Protects your business from injury-related lawsuits. | State-mandated coverage amounts. Expect $1,200 to $2,800 annually per driver depending on safety record. | Your driver herniated a disc securing load straps, requiring $28,000 in surgery and missing two months of work. Workers' comp covered all medical costs and wage replacement. | |
Protects your warehouse, maintenance shop, terminals and business equipment from fire, theft and weather damage. Covers the physical assets that keep your fleet running. | Match replacement cost of facilities and equipment, ranging from $250,000 to $2 million coverage. | Fire destroyed your maintenance bay and $65,000 in tools. Property insurance covered rebuilding costs and equipment replacement, keeping your fleet operational. | |
Equipment Breakdown Insurance | Covers mechanical failures that standard policies exclude - engine breakdowns, refrigeration unit failures, hydraulic system malfunctions. Includes lost revenue during repairs. | $500,000 to $2 million per incident. Higher limits recommended for refrigerated or specialized equipment fleets. | Your reefer unit failed during a 1,200-mile produce haul, spoiling $20,000 in cargo and requiring $6,000 emergency repairs. Coverage paid the full $26,000 loss. |
Transportation Business Insurance Requirements
Your transportation business must comply with insurance mandates from federal agencies, state laws, and commercial contracts to maintain operating authority and secure client agreements. Non-compliance results in operating authority revocation, license suspension, and contract termination.
Commercial Auto Liability Insurance | FMCSA legally mandates coverage for interstate motor carriers with BMC-91 forms required before granting operating authority. State laws require coverage for business-owned commercial vehicles with penalties including DOT suspension and inability to operate legally. | FMCSA minimums: $750,000 for general freight, $1.5 million for passenger vehicles under 16 seats, $5 million for 16+ passengers or hazardous materials. State minimums range from 15/30/25 to 30/60/25. |
Workers' Compensation Insurance | Required by law in 48 states once you hire employees, with penalties including $10,000 fines per employee, criminal charges, and personal liability for medical costs. Some states require coverage for trucking companies regardless of employee count due to DOT licensing. | State-mandated minimums with premiums calculated at 8% to 15% of driver payroll. Annual costs range from $1,200 to $2,800 per driver based on state requirements and claims history. |
Environmental/Pollution Liability Insurance | FMCSA requires coverage for hazardous materials carriers through MCS-90 endorsement filing. Commercial contracts mandate pollution coverage before authorizing transportation of chemicals, fuel or waste materials with contract termination for non-compliance. | FMCSA requires financial responsibility up to liability limits ($1 to $5 million) for environmental restoration. Standalone policies cost $1,500 to $3,000 annually with $1 million to $5 million coverage limits. |
Cargo Insurance | FMCSA mandates coverage for household goods carriers with BMC-34 filing required before authority approval. Freight brokers and shippers contractually require proof before load assignment with contract termination for non-compliance. | FMCSA minimum $5,000 per vehicle, $10,000 per occurrence for household goods. Commercial contracts require $100,000 to $2 million with certificates naming clients as loss payees. |
General Liability Insurance | Required by commercial clients before allowing transportation services on their property and mandated by landlords for warehouse leases. Municipalities require proof for business licensing and commercial vehicle permits. | Commercial contracts require $1 million per occurrence and $2 million aggregate minimums. Government contracts and high-value shippers mandate $3 to $5 million with additional insured endorsements. |
How To Ensure Transportation Business Insurance Requirements Are Met
This guide helps you maintain compliance with transportation insurance requirements after purchase. You'll need to prove coverage and keep documentation current to meet FMCSA regulations, client contracts, and state licensing requirements.
- 1Request certificates of insurance from your provider
Contact your insurer immediately after purchasing coverage to request COIs, as you can't dispatch trucks or accept loads without proof of required coverage. Most insurers deliver certificates within 24 to 48 hours via email, though same-day service costs $25 to $50 for urgent freight commitments.
- 2File required forms with FMCSA
Your insurer must file BMC-91 and BMC-34 forms directly with FMCSA before your operating authority becomes active. Monitor your FMCSA profile online to confirm filings appear within five to 10 business days, and contact your insurer immediately if forms don't appear.
- 3Verify coverage meets contract requirements
Review client contracts to confirm your policy limits meet their insurance requirements, as freight brokers often require $1 to $2 million coverage beyond FMCSA minimums. Check that coverage types and deductible limits match contract specifications to avoid losing load opportunities.
- 4Submit COIs and add additional insureds
Send certificates to freight brokers and facilities before dispatching trucks, as most require proof on file before authorizing property access. Request additional insured endorsements for clients who require them (costs $25 to $100 per endorsement) and ensure certificates show current policy periods.
- 5Set up renewal alerts and update documentation
Schedule reminders 60 to 90 days before expiration to avoid coverage lapses that suspend operating authority. Send updated COIs to active clients when policies renew, as contracts often require 30-day advance notice of insurance changes.
Get Business Insurance You Need For Your Transportation Business
You can get matched to the best transportation business insurance company for your needs using our tool below. We'll match you to a top provider, but we still recommend comparing options, researching transportation insurance costs, and evaluating additional insurers to find your best fit.
Get Matched To The Best Transportation Business Insurer For Your Needs
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About Mark Fitzpatrick
Mark Fitzpatrick, a Licensed Property and Casualty Insurance Producer, is MoneyGeek's resident Personal Finance Expert. With over five years of experience analyzing the insurance market, he conducts original research and creates tailored content for all types of buyers. His insights have been featured in publications like CNBC, NBC News and Mashable.
Fitzpatrick holds a master’s degree in economics and international relations from Johns Hopkins University and a bachelor’s degree from Boston College. He's also a five-time Jeopardy champion!
He writes about economics and insurance, breaking down complex topics so people know what they're buying.