Livestock hauler insurance

Who does the $750,000 rule cover?

Federal rules apply this minimum to for-hire carriers. These are carriers who move nonhazardous property in interstate or foreign commerce using vehicles with a weight rating of 10,001 lbs or more. Livestock is treated as nonhazardous property.

The term "for-hire" has a precise meaning. Federal rules define it as carrying the goods or property of someone else in exchange for payment. So if a rancher hires you to haul their cattle, you are hauling for hire.

Farmers hauling their own animals

If you only haul your own animals, you aren't hauling for hire, so this federal $750,000 minimum isn't aimed at you. Your state may still have its own rules, so it's worth checking.

If every trip stays inside one state, that state sets your liability minimum and the paperwork, often a Form E your insurer sends in.

What the livestock exemption covers and leaves out

Some new haulers hear about the livestock "exemption" and think they can skip buying commercial coverage. Ordinary livestock is exempt under federal law, but only from rules "under this part." The law covered by that phrase addresses for-hire registration and operating authority only, so many other federal trucking rules still apply.

What the exemption takes away:

• Operating authority. Many paid interstate carriers need this federal permit, known as an MC number. FMCSA says carriers that haul only exempt commodities do not need one.
• The insurance filing requirement. FMCSA notes that carriers moving exempt commodities do not file proof with FMCSA, so no proof of coverage is sent in for you.

What the exemption still requires:

• The coverage itself. FMCSA says these carriers still fall under the federal insurance rules and must carry at least $750,000 in liability.
• Proof to carry. You keep Form MCS-90, an endorsement that attaches to your liability policy and shows that your coverage satisfies what federal law requires.

FMCSA says the $750,000 minimum for exempt-commodity carriers applies to vehicles rated 10,001 lbs or more. Different federal minimums may apply to lighter for-hire vehicles.

Federal liability minimums for different loads and vehicle weights

The $300,000 amount comes from federal rules. The hazmat amounts are listed on FMCSA's insurance filing chart.

Coverage for the animals you haul

For nonhazardous property, federal law sets no cargo insurance requirement, so animal coverage is your choice. Even though the law doesn't ask for it, the people who hire you may want to know their animals are protected, so it's worth asking an agent about it.

A standard cargo policy may not suit a load like this. Joe Morten & Son, a trucking agency, explains that standard motor truck cargo policies normally cover property, not live animals. It suggests asking an agent how a policy handles death, injury, animal welfare and shrink, which is the weight animals lose on the road.

Livestock transit coverage exists for this need. The Insurance Store calls it the coverage that pays out when livestock are hurt or killed while being transported. The Hartford's livestock coverage provides broad-perils protection for death and crippling during transit.

The Hartford's livestock transit flyer includes these optional extras:

• Carcass removal: covers the cost of removing animals that die of a covered cause.
• Refusal of shipment: pays for lost value when the receiver turns down the whole load due to a covered cause.
• Substitution of vehicles: adds a temporary replacement vehicle to the coverage.

Progressive Commercial mentions moving livestock on its farm trucks page, but that page does not describe a separate livestock hauler policy.

Additional insurance for your truck

A full insurance setup usually goes beyond liability and animal coverage:

• Physical damage: ask an agent what coverage is available for damage to your truck and trailer, and which losses it covers.
• General liability: covers claims that have nothing to do with driving. For this cover, hotshot businesses pay on average $32 a month.
• Non-trucking liability or bobtail: meant for drivers who are leased on to a carrier. While you're under dispatch the carrier's own filing protects you, and this policy steps in when you're not under dispatch.

Questions haulers ask