Owner-Operator Insurance
A complete guide to coverage types, costs, and requirements for independent truck drivers
OLPolicy | (866) 757-5350 | Last Updated: 2026 | Reading Time: ~18 min
| Key Takeaways
• Owner-operator insurance is a bundle of coverages designed specifically for independent truck drivers operating under their own authority or leased to a carrier. • The minimum required coverage is primary auto liability, mandated by the FMCSA at $750,000 to $1,000,000 for most freight operations. • Owner-operators on their own authority typically pay $9,000 to $16,000 per year; those leased to a carrier pay $5,000 to $9,000. • Key coverages beyond liability include physical damage, motor truck cargo, bobtail/non-trucking liability, and occupational accident insurance. • OLPolicy specializes in owner-operator insurance and can help you compare rates from multiple top-rated carriers. Call (866) 757-5350 for a free quote. |
Running your own trucking operation is one of the most demanding and rewarding paths in commercial transportation. As an owner-operator, you are responsible not only for your truck and your loads but also for the full scope of your insurance obligations obligations that differ significantly depending on whether you are leased to a carrier or running under your own motor carrier authority.
Owner-operator insurance is not a single policy. It is a package of coverages assembled to meet federal regulatory requirements, protect your truck and cargo, and cover gaps that exist between your business operations and a carrier’s master policy. Getting the right combination of coverages at the right limits and the right price is one of the most consequential financial decisions you will make as an independent operator.
This guide walks through every coverage type relevant to owner-operators, explains what each protects, outlines what you are legally required to carry, and gives you a realistic picture of what each coverage costs. If you have questions at any point, OLPolicy’s team of commercial transportation specialists is available at (866) 757-5350.
A company driver operates a truck owned by a carrier and is covered under that carrier’s commercial insurance policy for liability and physical damage. The driver bears no personal insurance obligation beyond a personal auto policy for their non-work vehicle.
An owner-operator is different in every material way. You own or finance your own truck. You are either running under your own FMCSA-issued motor carrier authority or leased to a carrier under a permanent lease agreement. In either case, a portion of your insurance responsibility rests directly with you and understanding exactly which portion is critical to staying both legally compliant and financially protected.
The specific coverages you need, and who pays for them, depends almost entirely on your operating structure: leased to a carrier or operating under independent authority.
| Factor | Leased to a Carrier | Independent Authority (Own MC) |
| Primary Liability | Carrier’s policy covers you under dispatch | You must carry your own primary liability policy |
| Bobtail / NTL Coverage | You need this for off-dispatch periods | Generally not applicable; primary liability covers all ops |
| Cargo Insurance | Often required; may or may not be covered by carrier | You must carry your own cargo policy |
| Physical Damage | Your responsibility in most lease agreements | Your responsibility |
| Occupational Accident | Typically your responsibility unless carrier provides | Your responsibility |
| Average Annual Cost | $5,000 – $9,000 total | $9,000 – $18,000+ total |
| Regulatory Responsibility | Carrier holds MC authority; you operate under theirs | You hold and maintain your own MC/DOT authority |
| Important
Before purchasing any coverage, request and carefully read your carrier lease agreement if you are leased. It will specify exactly which coverages the carrier’s policy provides, which coverages you are required to maintain independently, and what limits are required. |
Most owner-operators need several distinct coverage types working together. Each fills a specific gap in your overall protection. Understanding what each one does and what it does not cover prevents costly surprises at claim time.
Primary auto liability is the foundational coverage for any commercial trucking operation. It pays for bodily injury and property damage that you cause to third parties other drivers, pedestrians, and property owners as a result of an accident in which you are at fault.
This is the coverage mandated by the FMCSA for all for-hire carriers. Without it, you cannot legally operate in interstate commerce. If you are leased to a carrier, their primary liability policy covers you while you are under dispatch. If you operate under your own authority, you must purchase and maintain your own primary liability policy at all times.
Most shippers and freight brokers require a minimum of $1,000,000 in primary liability regardless of the FMCSA minimum for your cargo type. Building your policy around this limit is the practical standard for operating in today’s freight market.
| FMCSA Minimum Liability by Operation Type | Minimum Required |
| Non-hazmat freight, vehicles over 10,001 lbs (interstate for-hire) | $750,000 |
| Hazardous materials (certain classes) | $1,000,000 – $5,000,000 |
| For-hire passenger transport (buses) | $5,000,000 |
| Market standard required by most freight brokers | $1,000,000 |
Physical damage coverage protects your truck your most valuable business asset against loss or damage. It combines two sub-coverages that are typically written together:
Physical damage is not required by the FMCSA, but if your truck is financed, your lender will almost certainly require you to carry it as a condition of the loan. Even if your truck is paid off, the cost of replacing a modern semi-tractor which can range from $80,000 to $180,000 or more makes this coverage financially essential for most operators.
Premiums for physical damage are calculated as a percentage of the truck’s insured value, typically 2 to 4 percent annually. For a truck insured at $100,000, you might expect to pay $2,000 to $4,000 per year before deductible adjustments. Choosing a higher deductible $2,500 or $5,000 rather than $1,000 can meaningfully reduce this cost.
Cargo insurance covers the freight you are hauling against loss, damage, or theft while it is in your care, custody, and control. From the moment you sign the bill of lading until the load is delivered and receipted, you bear legal liability for the freight’s condition and security.
While cargo insurance is not federally mandated for dry van operations, the vast majority of freight brokers require it typically at a minimum of $100,000 per occurrence. Without a current cargo certificate on file with a broker, they cannot legally tender you a load. For practical purposes, cargo insurance is as close to required as a coverage can be without being federally mandated.
Standard cargo policies cover general commodities against named perils. If you haul higher-risk freight refrigerated goods, electronics, building materials, or high-value merchandise you may need additional endorsements. Common cargo policy additions include:
Bobtail insurance covers your tractor when it is operating without a trailer whether you are returning empty after a delivery, repositioning to a pickup, or driving to a truck stop for fuel. The term ‘bobtail’ refers specifically to a tractor running without a trailer attached.
This coverage is primarily relevant for owner-operators leased to a carrier. When you are under dispatch and pulling a trailer, the carrier’s primary liability policy covers you. But when you are driving the truck for any purpose other than a specific dispatched move including the drive home, the empty return trip, or a detour to a fuel stop you are typically outside the scope of the carrier’s policy. Bobtail insurance fills that gap.
Bobtail coverage is relatively inexpensive, typically $300 to $700 per year, and it is often required by lease agreements. It is narrow in scope it applies only to liability, not to physical damage on your truck but it provides essential protection for the significant amount of time you spend driving without an active dispatch.
Non-trucking liability (NTL) insurance is frequently confused with bobtail coverage, and the distinction matters. While bobtail insurance covers your tractor any time it is not pulling a load under dispatch including business-related repositioning moves non-trucking liability insurance covers only personal, non-business use.
Example: You complete a delivery, unhook the trailer, and drive across town to pick up your kids from school. That is a personal use trip. Non-trucking liability covers it. But if you are driving your bobtail from the delivery point to a truck stop to rest before your next dispatch, that is considered a business operation NTL does not cover it, but bobtail insurance does.
For leased owner-operators, you typically need one or both of these coverages depending on your carrier’s lease terms and how you use the truck off-dispatch. For independent authority operators, primary liability generally covers all business operations, making bobtail and NTL less relevant.
Owner-operators are generally not eligible for workers’ compensation insurance because they are self-employed rather than employees. Occupational accident insurance is the primary alternative designed to cover the financial consequences of an on-the-job injury or death.
A standard occupational accident policy provides coverage for:
Some carrier lease agreements include occupational accident coverage for leased owner-operators as part of the lease terms. Review your agreement carefully before purchasing a separate policy but also review what the carrier-provided coverage actually pays, as limits are sometimes lower than what an independent policy would provide.
For independent authority operators, occupational accident coverage is a critical component of your insurance package that is easy to overlook. Without it, a serious injury that keeps you off the road for months could be financially devastating.
Commercial general liability (CGL) insurance covers third-party bodily injury and property damage claims that arise from your business operations but are not related to the operation of your vehicle. Common scenarios that general liability covers include:
General liability is not required by the FMCSA, but it is increasingly required by shippers, especially in dedicated contract operations and retail distribution. Policy limits of $1,000,000 per occurrence and $2,000,000 aggregate are the common standard. Annual premiums typically range from $500 to $2,000 for owner-operators.
If you pull trailers that are not owned by you or the carrier you are leased to a common situation in trailer pool operations and drop-and-hook freight trailer interchange insurance provides physical damage coverage for those non-owned trailers while they are in your possession.
Without trailer interchange coverage, you may have no physical damage protection for a trailer that is damaged while attached to your truck if it is not owned by your carrier or covered by a carrier’s policy. Many broker agreements and shipper contracts specifically require you to carry trailer interchange coverage, so check your freight contracts carefully.
Insurance is typically one of the top three operating expenses for owner-operators, alongside fuel and truck payments. Understanding what drives cost helps you evaluate quotes accurately and identify where savings are genuinely possible.
| Coverage Type | Avg. Annual Cost | Required? | Notes |
| Primary Liability ($1M) | $5,000 – $18,000 | Yes (FMCSA) | Cost varies dramatically by cargo, state, and driver history |
| Physical Damage | $1,000 – $4,000 | If financed | ~2–4% of truck insured value annually |
| Motor Truck Cargo | $400 – $1,800 | De facto required | Most brokers require $100K minimum |
| Bobtail Insurance | $300 – $700 | Lease-dependent | Leased O/Os almost always need this |
| Non-Trucking Liability | $300 – $900 | Lease-dependent | Check lease terms before buying |
| Occupational Accident | $1,200 – $2,500 | Strongly advised | No workers’ comp alternative for self-employed |
| General Liability | $500 – $2,000 | Shipper-dependent | Increasingly required by larger shippers |
| Trailer Interchange | $400 – $1,000 | Contract-dependent | Required for non-owned trailer operations |
| Coverage | Own Authority (Est.) | Leased to Carrier (Est.) |
| Primary Liability ($1M) | $8,500 | Carrier covers (under dispatch) |
| Physical Damage ($90K truck) | $2,400 | $2,400 |
| Motor Truck Cargo ($100K) | $900 | $900 |
| Bobtail / NTL | Not typically needed | $550 |
| Occupational Accident | $1,500 | $1,500 |
| General Liability | $800 | $800 |
| Total Estimated Annual | $14,100 | $6,150 |
Profile assumed: Dry van freight, 48-state operating radius, 5 years CDL experience, clean MVR, truck value $90,000, domiciled in Midwest.
The figures above are national averages. Your actual premium is the output of an underwriter’s risk model that weighs these variables for your specific operation:
| Get Your Owner-Operator Insurance Quote Today
OLPolicy specializes in commercial trucking insurance for owner-operators. Compare rates from top-rated carriers in minutes and get the coverage you need at the best available rate. Call OLPolicy: (866) 757-5350 | Visit: OLPolicy.com |
The Federal Motor Carrier Safety Administration sets minimum insurance requirements for all motor carriers operating in interstate commerce. These are federal floors. Operating below them is a federal violation and will result in your authority being placed out of service.
If you are operating under your own authority, you obtained or are in the process of obtaining an MC number from the FMCSA. Part of the authority activation process requires you to file proof of insurance with the FMCSA through your insurer using specific federal forms:
Your insurer files these forms electronically on your behalf. Your operating authority will not be activated and will be suspended if it lapses without current, valid filings on record with the FMCSA. When you purchase a primary liability policy, confirm with your insurer that the BMC-91 filing is included and that it will be maintained continuously.
One of the most important and most overlooked aspects of FMCSA compliance is the continuous filing requirement. The FMCSA does not allow gaps in your insurance filings. If your policy lapses for any reason non-payment, cancellation, or non-renewal your insurer is required to file a cancellation notice with the FMCSA, which can trigger an automatic suspension of your operating authority.
The practical implication: even a brief lapse in coverage can result in a period during which you are legally prohibited from hauling freight under your own authority, with potential penalties and a reinstatement process. Paying your premium on time and maintaining open communication with your insurer and broker about renewal is not optional it is a core compliance obligation.
In addition to FMCSA federal requirements, some states impose their own minimum insurance requirements for intrastate operations. If you haul within a single state, that state’s Department of Transportation or public utilities commission may have requirements that differ from or exceed federal minimums. Several states also require additional filings, endorsements, or surety bonds for specific types of operations. Check with your state’s DOT and your OLPolicy broker to ensure your coverage meets both federal and applicable state requirements.
Insurance is a significant operating cost, and like any major expense, it rewards active management. The following strategies consistently produce the best results for owner-operators seeking competitive rates without sacrificing protection.
Your MVR is the most powerful rating factor in your premium, and it is entirely within your control over time. A clean record with no at-fault accidents or moving violations for three consecutive years opens access to preferred market carriers at substantially lower rates. Proactively addressing any violations before your renewal through traffic school or legal remedies where applicable can also help.
If you are adding drivers to your operation, their MVRs will be rated alongside yours. Selecting drivers with strong records is not just a safety decision; it is a direct insurance cost decision.
Many commercial trucking insurers offer documented discounts of 5 to 15 percent for fleets with verified dashcam programs. Beyond the discount, a front-facing dashcam is your best defense against fraudulent or exaggerated third-party liability claims. In a serious accident, dashcam footage can mean the difference between a claim that is paid and one that is defended successfully.
GPS tracking and electronic logging devices (ELDs) which are federally required for most commercial drivers also contribute to lower rates with some carriers. Telematics data that shows consistent safe driving behavior can qualify you for usage-based pricing programs that reward clean performance.
Raising your physical damage deductible from $1,000 to $2,500 or $5,000 reduces your annual premium meaningfully. This strategy works best when your truck is paid off and you have cash reserves sufficient to cover the higher deductible if needed. For operators with financed equipment, lenders may set a maximum allowable deductible that limits this option.
Carrier appetite for specific risk profiles changes year to year. An insurer that was aggressive on pricing for your profile two years ago may have tightened underwriting today, while a competitor has moved into that space at lower rates. Obtaining three to five competitive quotes at each renewal rather than simply accepting a renewal offer is the most consistent way to ensure you are not overpaying.
Working with an independent broker who specializes in commercial trucking, like the team at OLPolicy, gives you access to multiple specialty markets with a single application. A specialist broker understands which carriers are competitive for your specific risk profile and can advocate on your behalf with underwriters in ways that a general commercial lines agent cannot.
Placing your primary liability, physical damage, cargo and other coverages with a single carrier typically produces a multi-line discount and simplifies claims management. When an accident involves multiple coverage types which is common in trucking claims having all coverages with one carrier eliminates coordination disputes between insurers over who owes what.
Gaps in coverage history are a red flag for underwriters and often result in higher rates or outright declinations. Even if you are temporarily parked due to a slow freight market or truck repairs, keeping your policy active even at reduced limits or on a stored-vehicle basis preserves your insurance history and avoids the higher rates associated with starting fresh after a lapse.
| Talk to an Owner-Operator Insurance Specialist
The OLPolicy team understands the unique coverage needs of independent truckers. Whether you are just getting your authority or looking to lower your renewal rate, we will help you find the right coverage at the right price. Call OLPolicy: (866) 757-5350 | Visit: OLPolicy.com |
Having the following information ready before contacting an insurer or broker allows you to receive accurate, bindable quotes rather than rough estimates. It also signals to underwriters that you are an organized, professional operator.
When you receive quotes, comparing them accurately requires looking beyond the total premium number. Evaluate each quote across these dimensions:
| Working with OLPolicy
OLPolicy’s commercial transportation specialists will walk you through your quote comparison, explain the differences between competing offers, and help you select the combination of coverages that best fits your operation and budget. Call (866) 757-5350 or visit OLPolicy.com to get started. |
Yes. You cannot activate your FMCSA operating authority without a current insurance filing on record. When you apply for your MC number, part of the activation process involves your insurer filing Form BMC-91 or BMC-91X with the FMCSA to confirm that your primary liability policy is in force. Many new authorities are delayed simply because operators do not start the insurance process early enough. Begin working with an insurance broker like OLPolicy at the same time you begin your authority application so that coverage is ready to bind and file when your authority is approved.
Both coverages apply when you are not actively hauling a load under dispatch, but they cover different situations. Bobtail insurance applies any time you are operating your tractor without a trailer, regardless of whether the trip is business-related. Non-trucking liability applies only during genuinely personal use trips that have no connection to your business operations. If you are driving your truck to a truck stop between dispatches, bobtail coverage applies. If you are driving it on a personal errand on your day off, non-trucking liability applies. Many owner-operators need both, and they are typically inexpensive to carry together.
Yes, though your options will be more limited and your rates will be higher than those available to experienced drivers. New CDL holders and new motor carrier authorities are considered higher risk by standard market underwriters, and some standard carriers set a minimum experience threshold often two years of CDL tenure before they will write a new authority. Non-standard and surplus lines markets are available for inexperienced operators, but premiums are meaningfully higher. Most operators see their rates decrease significantly after their second and third year of clean operating history.
A lapse in coverage for an owner-operator operating under their own authority has two serious consequences. First, your insurer is required to file a cancellation notice with the FMCSA, which will automatically trigger a suspension of your operating authority. You will be legally prohibited from hauling freight under that authority until coverage is reinstated and confirmed with a new BMC-91 filing. Second, a lapse in coverage history is a negative underwriting signal that can result in higher rates or declination by preferred market carriers when you seek to reinstate. Maintaining continuous coverage is a compliance and cost management imperative. If cash flow is a concern, contact OLPolicy at (866) 757-5350 before your premium is due there may be payment plan options that prevent a lapse.
No, though they serve similar purposes. Workers’ compensation is a state-mandated benefit program that applies to employees. As a self-employed owner-operator, you are generally not eligible for workers’ compensation in most states. Occupational accident insurance is a private insurance product specifically designed to provide income replacement, medical coverage, and death benefits for independent contractors who are injured while working. Coverage terms, benefit limits, and exclusions vary significantly between policies, so it is important to review the specific terms of any occupational accident policy rather than assuming the coverage is equivalent to workers’ compensation.
The practical minimum for most owner-operators is $100,000 per occurrence, as this is the threshold required by the majority of freight brokers. However, your actual cargo liability exposure depends on what you are hauling. If you regularly transport loads with a declared value above $100,000 which is common with electronics, pharmaceuticals, building materials, and certain retail freight your coverage limit should reflect your actual maximum load value. Carrying $100,000 in cargo insurance while regularly hauling loads worth $150,000 or more leaves you personally exposed for the difference in the event of a total loss.
Yes. Many shippers, receivers, and contract partners will require that they be named as additional insureds on your liability policy. This is a standard commercial insurance practice and can typically be accomplished through an endorsement at little or no additional cost. Confirm with your OLPolicy broker that your policy allows for additional insured endorsements before signing any contract that requires them.
Owner-operator insurance is not a commodity to be minimized it is the financial foundation of your independent trucking business. A single uninsured or underinsured accident can generate liability claims that exceed the value of your truck many times over, end your operating authority, and create personal financial exposure that follows you for years.
The good news is that the right coverage does not have to be prohibitively expensive. Understanding your actual coverage needs, maintaining a clean driving record, working with a broker who specializes in commercial transportation, and shopping the market at every renewal are the most reliable ways to keep your premiums competitive while maintaining the protection your business requires.
Whether you are just getting started with your first owner-operator authority or looking for a better rate on an existing policy, OLPolicy’s commercial transportation specialists are here to help. We work with multiple top-rated carriers and can help you compare coverage options side by side to find the best fit for your operation.
| Ready to Protect Your Operation? Talk to OLPolicy Today.
Get free owner-operator insurance quotes from multiple top-rated carriers. OLPolicy’s specialists understand the trucking industry and will help you build the right coverage package at the right price. Call OLPolicy: (866) 757-5350 | Visit: OLPolicy.com |
Disclaimer: This article is provided for general informational purposes only and does not constitute insurance, legal, or financial advice. Coverage requirements, rate ranges, and regulatory minimums are subject to change. Consult a licensed commercial insurance professional for advice specific to your operation. OLPolicy is a licensed insurance agency.
