Anyone interested in getting into the trucking business under their own authority is often hit with a harsh reality when they try to get insurance. A $10,000 or more bill is common for one year of coverage and in some cases, can even stymie efforts to get into the business.
According to Ashley Hammonds, senior vice president of sales at Reliance Partners, there have been some recent incidents of new venture insurance coming in under $10,000, but generally most policies are in the $10,000 to $15,000 range. There are some instances of the policy approaching $24,000, he says.
So why is new venture insurance so expensive and, more importantly, is it something that every trucking company needs?
The second part of that question is easy. New venture insurance is for those companies with new operating authority, although even someone that has many years of experience could be required to obtain new venture insurance if there has been a break in coverage, i.e., you took 3 years off and came back to trucking.
Like most insurance policies, the first part of that question has many answers. For one, not many companies provide new venture insurance, viewing it as a more significant risk due to the lack of data on the new trucking company.
“New ventures tend to fit in a smaller box,” Hammonds says. “There are fewer companies interested in them. For instance, there may be five markets for new venture insurance but 35 markets for an established company.”
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