Before a new hot shot operation hauls its first paid load across a state line, the Federal Motor Carrier Safety Administration has to see proof of liability insurance on file. FMCSA states plainly that it will not grant operating authority until the registrant has the minimum levels of financial responsibility in effect. For most new owner-operators, that makes the insurance filing the step that sets the start date.

Hot shot trucking, usually a heavy-duty pickup pulling a gooseneck or flatbed trailer, is a common way into the business around Paducah, Calvert City, Mayfield and Murray. I-24 and I-69 put a lot of regional freight within a day’s drive, and the startup cost is lower than a tractor-trailer. The insurance side is where many new operators lose the most time.

The federal minimums, in plain terms

FMCSA’s insurance filing chart sets these public liability minimums for for-hire carriers of property:

  • Non-hazardous property, vehicles under 10,001 pounds GVWR: $300,000.
  • Non-hazardous property, vehicles 10,001 pounds GVWR or more: $750,000.
  • Certain hazardous materials: $1,000,000, and $5,000,000 for explosives, poison gas or radioactive materials.

That 10,001-pound line is the one hot shot operators run into. A heavy-duty pickup and a loaded gooseneck trailer can land on either side of it depending on the truck, the trailer and how the operation is set up, and the weight rating listed on the authority application drives which minimum applies. That’s a detail to confirm with the actual equipment specs in hand, not by rule of thumb.

The minimums are minimums. Many brokers and shippers ask for higher limits in their carrier packets than the federal floor, so the load board you plan to work often decides the practical limit as much as the regulation does.

How the filing actually works

The insurance company, not the trucker, files proof of coverage with FMCSA, using a form such as the BMC-91 or BMC-91X. FMCSA also requires the MCS-90 endorsement on policies for for-hire and interstate motor carriers. Once authority is granted, the carrier has to keep proof of insurance and a designation of process agents (the BOC-3) on file, or FMCSA can start revocation proceedings.

Two practical points follow from that. A gap in coverage can put the authority itself at risk, not just the truck. And switching insurers means a new filing has to be in place before the old one is cancelled, which is easy to get wrong in a hurry.

What the federal rule doesn’t require

FMCSA’s chart lists a $0 cargo insurance minimum for general freight carriers. The federal rule doesn’t require cargo coverage, but brokers commonly do. Most carrier setup packets ask for a cargo certificate, and some specify a limit or name the commodities they want covered.

Other pieces a new operation usually sorts out around the same time:

  • Physical damage on the truck and trailer, which lenders typically require if either is financed.
  • Trailer interchange, when you pull a trailer you don’t own under a written agreement.
  • Non-trucking or bobtail liability, for owner-operators leased onto another carrier’s authority, when the truck is used outside that carrier’s dispatch.
  • Workers’ comp, once there is a driver or helper on payroll. Our post on workers’ comp for small businesses in Kentucky covers when that comes into play.

Certificates of insurance come up constantly in trucking, the same way they do for contractors. Our guide to certificates of insurance for Kentucky contractors explains what a certificate does and doesn’t prove.

Before you apply for authority

A few things move the process faster:

  • The year, make, VIN and weight rating for the truck and trailer.
  • Your CDL status and driving record, plus any other drivers you plan to add.
  • The radius and commodities you plan to haul, and whether any are hazardous.
  • Whether you’ll run under your own authority or lease onto another carrier.

Trucking is a different market from a personal auto policy or a contractor’s business auto, and new authorities are underwritten carefully.

When you’re ready to walk through it

If you’re starting a hot shot or small trucking operation in Western Kentucky or Northwest Tennessee, send us your equipment list and how you plan to run, and we’ll quote it across the trucking markets we work with. Start from our commercial trucking insurance page, request a quote, or call (270) 925-1524. If you already have a policy, send your current dec page and we’ll walk through it with you.

This article is general information about how coverage typically works, not advice about your specific situation. Every policy reads a little differently, and yours is the only thing that says what you have. If you’d like a second set of eyes on it, send us your current dec page and we’ll walk through it with you.