Even if you’re a self-proclaimed ‘great driver,’ accidents can happen. Having the right insurance coverage can protect you, others, cargo, and your equipment, like a box truck. These trucks are expensive to repair or replace. Many fleets use box truck insurance to lower their financial risk in the event of an accident.
In exchange for mitigating risk, insurance companies ask for a premium. You can get sufficient protection without high premiums. We’ll share what goes into this insurance policy and how to lower your premiums.
And when you’re finished reading, check out these other articles in our ‘How to become a box truck owner operator’ series:
- 9 steps to become a box truck owner operator
- How much does box truck insurance cost?
- Best box truck financing options
- 7 tips for evaluating box truck dispatch services
What Is a Box Truck?
Truck drivers use box trucks to deliver freight to customers. These trucks feature box-shaped cargo compartments with a rear roll-up door. Some box trucks also include side doors. Many truckers and operators appreciate the box truck’s engine and its ability to store cargo safely.
How Is a Box Truck Used?
Box trucks store freight and enable drivers to transport goods across road lanes. Freight gets stored safely within the truck’s box. Box trucks offer protection from the weather and other elements, a vital factor for many cargo types.
Types of Businesses That Use Box Truck Insurance
As a staple in the transportation industry, box trucks carry a wide range of cargo. Many businesses rely on box trucks to receive their freight, service customers, and expand operations. Trucking companies respond to this demand by purchasing box trucks and insurance policies.
These are some businesses that use box truck insurance.
- Home Moving Services: When people move, they take their stuff with them. Home moving services put cargo in box trucks and ship them to the new destination.
- Ecommerce Companies: These companies fulfill customer orders and rely on box trucks and other transportation to deliver freight.
- Hazmat Trucking Companies: Box trucks can store hazardous materials. Trucking companies will pay extra premiums to protect their hazardous freight.
- Truck Drivers: Independent truckers may use box truck insurance for their vehicles.
- Meat Plants: These companies need meat delivered at tight schedules. They will ask for reefer trucks to deliver their freight. Reefer trucks are refrigerated box trucks designed to store cargo at a set temperature.
Average Cost of Box Truck Insurance
Box truck insurance costs range based on your business, coverage needs, and driver records. The average annual insurance costs range from $3,000 to $5,000 per year, but each business gets a different premium. A licensed insurance agent specializing in commercial trucking can set you up with an appropriate box truck insurance premium.
Which Factors Impact Box Truck Insurance Cost?
Box truck insurance provides necessary protections, but what goes into the assigned premiums? You may pay higher premiums than the nearby trucking company. Why does that happen? These factors provide a glimpse of what goes into box truck insurance premiums.
Driving Records
Insurance companies consider multiple risk factors when providing premiums. A significant risk factor is a person behind the wheel. Reckless drivers get into accidents more often, and insurance companies will protect themselves from that risk.
Companies with poor driving records can expect higher insurance premiums. Insurance companies are strict about driving records due to the weight of cargo. A single speeding ticket can significantly increase premiums. You can lower costs by hiring truckers with clean driving records.
The Box Truck’s Worth
When a box truck gets damaged, insurance steps in to cover the costs if the company has comprehensive and collision insurance and has the truck listed at the correct stated value. Some vehicles cost more than others which results in varying costs of repair. When assessing passenger cars, insurance companies will charge higher premiums for a new Lamborghini than an old Toyota.
The luxury car costs more to replace or repair, leading to a higher insurance policy. Insurance companies apply the same logic to box trucks. They charge higher premiums if your box truck has more value than the average box truck.
Your Coverage
Insurance companies can help reduce costs in the event of an accident. However, the coverage you select impacts how much they’ll chip in for repairs. Less coverage leads to lower premiums but also less protection. You can buy more protection, but it will also yield higher premiums.
The Cargo You Haul
Not all cargo is equal. Some cargo comes with greater risk for insurance companies. For instance, Hazmat and expensive freight will result in higher premiums.
Some truck companies can adapt and ship cargo that keeps premiums low. However, other truckers may absorb the higher premiums to service clients who order deliveries for hazmat and expensive freight.
4 Ways to Lower Box Truck Insurance Cost
The trucking industry has low-profit margins. Order volume helps trucking companies realize higher profits, but insurance premiums can get in the way. You need an insurance policy for extra protection, but what if you could snag a more affordable policy? We’ll share some strategies to lower your box truck insurance costs.
Comparison Shop
Trucking companies can select from multiple insurance companies and request free quotes. You can use other policies when negotiating for lower premiums. Find the most attractive price before committing to a policy.
Annual or Fewer Installment Payments
Insurance companies prefer to get their money in a lump sum. They incentivize trucking companies to make annual payments instead of monthly payments. Spreading the premiums across fewer payments per year can reduce your overall premium costs. You only have to worry about annual payments once a year. You can lower overall monthly bills and leave room in your budget for other expenses.
Ask for Discounts
A simple request can trim your insurance premiums. You may be eligible for discounts based on your payment plan, driving record, bundle deals, and other factors. Ask your agent which discounts you can use for your premiums. The worst-case scenario is that your agent informs you that no discounts are available. Even if the deal doesn’t save you much money, it’s better than nothing.
Increase Deductibles
Increasing deductibles is an easy way to reduce insurance premiums, but this strategy comes at a cost. Higher deductibles result in more out-of-pocket expenses if something happens. Higher deductibles hurt if you frequently call your insurance company about incidents. However, you can save money in the long term if you don’t have many accidents.
Protect Yourself with Box Truck Insurance
You can’t predict if an accident will happen. However, you can prepare for one in advance. Box truck insurance provides a safeguard in the event of an accident. The insurance company will help you pay costs for repairs and replacements. This insurance policy makes an excellent addition for any trucker or company that relies on box trucks.
FAQ
Box truck insurance can provide coverage for your box truck. This policy is a modified version of commercial auto insurance.
Box truck costs vary considerably from $25,000 to over $70,000 depending on the model and usage.
The average box truck driver makes over $75,000 per year.
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