Fuel truck insurance

Why gasoline needs $1,000,000, not $5,000,000

A lot of people think gasoline needs $5,000,000 because it sits on the federal hazardous materials list. That is not how the rules work. FMCSA guidance notes that the Clean Water Act groups gasoline with oil rather than with hazardous substances, which lands it in the $1,000,000 category.

The federal rule covers trucks with a rated weight of 10,001 lbs or more. That includes carriers delivering fuel for someone else and businesses moving their own supply. Any gasoline volume qualifies when it travels between states, and so does bulk gasoline that never leaves a single state.

When your tank size changes the rules

The federal measure for a tank is water gallons, or the amount of water it would hold. Once a tank holds more than 3,500 water gallons, it is "in bulk" under the federal definition. That label often settles which minimum applies to your truck.

A truck is "intrastate" when pickup and delivery both happen in one state with no border crossing. A smaller delivery truck that stays within one state and hauls fuel that is not in bulk is not covered by the federal floor under 49 CFR 387.3. State rules take over, and the insurer normally provides proof to the state, frequently on a Form E.

Propane follows separate thresholds in FMCSA guidance:

• A propane tank bigger than 3,500 water gallons calls for $5,000,000, whether it crosses a state line or not.
• If the tank holds 3,500 water gallons or less, crossing a state line calls for $1,000,000.
• That smaller tank, when it stays within a single state, is governed by state rules alone.

Cargo tanks with multiple compartments

Certain cargo tanks are divided into separate compartments. When the cargo is a hazardous substance, FMCSA measures the full tank instead of judging each compartment on its own. So, when every compartment holds less than 3,500 water gallons yet together they exceed that amount, coverage of $5,000,000 is required.

Liability minimums by load and route

These minimums cover vehicles with a rated weight of 10,001 lbs or more.

Pollution cover for fuel haulers

At the federal level, the required coverage is public liability insurance. It responds to injuries and damage suffered by other people, and the federal definition also covers environmental restoration, which means spill cleanup claims fall within its intended scope.

There is a catch here. A commercial auto policy's pollution exclusion can affect a fuel-release claim, so ask an agent to review how your policy handles spills. Kelly Insurance Group explains that this exclusion creates trouble when a release grows larger than a standard auto claim. For that reason, it recommends that fuel haulers have their environmental liability reviewed separately.

Filing your insurance

If you operate under your own authority and cross state lines, your insurer sends proof to FMCSA through the BMC-91 or BMC-91X forms. Your liability policy also needs an MCS-90 endorsement, which FMCSA requires, so ask your agent to add it. Once your authority application shows up in the public record, the insurer has 20 days to submit the filing, or the application is thrown out.

Common questions