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Insurance Requirements to Start Your Own Limited Liability Company (LLC) With a DOT# and Motor Carrier Authority
Starting a Limited Liability Company (LLC) is a great way to establish a business and protect your personal assets from potential liabilities. An LLC can be used for many types of businesses, including those involving transportation and freight. If you’re starting an LLC for a transportation business, you’ll need to apply for a Department of Transportation (DOT) number and a Motor Carrier Authority (MCA) permit. Along with this, you’ll also need to obtain appropriate insurance coverage to protect your business and its drivers.
In the next few paragraphs we will provide an overview of the insurance requirements necessary to start your own LLC with a DOT# and MCA. We’ll discuss the types of insurance needed, who needs to be insured, what limits should be set, and how to get the most competitive rate.
Types of Insurance for Your LLC
When starting an LLC for a transportation business, you’ll need to obtain several different types of insurance coverage. The most important type of insurance for a transportation business is liability insurance. Liability insurance will protect you from potential claims of negligence and other liabilities that may arise from the operation of your business. The other types of insurance you should consider are cargo insurance, motor carrier physical damage insurance, and non-trucking liability insurance.
Liability Insurance
Liability insurance is the most important type of insurance for any transportation business. It covers your business in case of accidents, negligence, and other liabilities. Liability insurance can be divided into two categories: general liability insurance and motor carrier liability insurance.
General liability insurance covers your business in case of property damage or personal injury. It covers the cost of repairs, medical bills, and legal fees in the event of an accident. Motor carrier liability insurance covers the cost of repairs and medical bills in the event of an accident involving a motor vehicle owned and operated by your business. This type of insurance is mandatory for all businesses that transport goods.
Cargo Insurance
Cargo insurance is a type of insurance that covers your business in the event of cargo loss or damage. This type of insurance is required for any business that transports goods for hire. Cargo insurance covers the cost of replacing or repairing lost or damaged goods. It also covers the cost of legal fees if your business is sued for cargo loss or damage.
Motor Carrier Physical Damage Insurance
Motor carrier physical damage insurance is a type of insurance that covers the cost of repairs to your business’s motor vehicles. This type of insurance is required for any business that owns and operates motor vehicles. It covers the cost of repairs in the event of an accident or other damage.
Non-Trucking Liability Insurance
Non-trucking liability insurance is a type of insurance that covers your business in the event of an accident or other liability while your motor vehicle is not being used to transport goods. This type of insurance is required for any business that owns and operates motor vehicles. It covers the cost of repairs and medical bills in the event of an accident or other damage.
Who Needs to Be Insured?
When starting an LLC for a transportation business, you’ll need to make sure that all drivers and employees are adequately insured. This includes any drivers who operate motor vehicles owned and operated by your business, as well as any employees who work in the office or warehouse.
What Limits Should Be Set?
When choosing insurance coverage for your business, it’s important to set appropriate limits. The limits you choose will depend on the size and scope of your business, as well as the type of goods you transport. Generally speaking, you should set limits that are high enough to cover potential liabilities.
How to Get the Most Competitive Rate
When shopping for insurance coverage, it’s important to shop around and compare rates from different insurers. You can do this by using an online insurance comparison tool or contacting multiple insurers directly. By comparing rates, you can be sure to get the most competitive rate for your business.
Starting an LLC for a transportation business requires obtaining several different types of insurance coverage. The most important type of insurance is liability insurance, which covers your business in case of accidents and other liabilities. You should also obtain cargo insurance, motor carrier physical damage insurance, and non-trucking liability insurance. Make sure to include all drivers and employees in your insurance coverage, and set appropriate limits for each type of coverage. Finally, shop around and compare rates from different insurers to ensure you get the most competitive rate.
Go ahead and send us some basic information and we’ll do the truck insurance quotes for you and discuss the most affordable option for you to move forward.
Click here to get commercial truck insurance quotes for your LLC.
We have the following: Commercial Big Rig Truck Insurance · Motor Truck General Liability · Non-Trucking Liability · Motor Truck Cargo · Trailer Interchange · Rental Reimbursement with Downtime for owner operators up to fleet size operations. We also have very fast workers compensation insurance for truckers of all types.
Truck Insurance Classification Codes And Descriptions
Insurers classify trucking companies both small and large using several coding systems.
SIC CODES: 4212 Local Trucking without Storage, 4213 Trucking, Except Local, 4214 Local Trucking with Storage
ISO General Liability Codes: 99793
NAICS CODES: 484110 General Freight Transit, Local, 484121 General Freight Transit, Long-Distance – Truckload, 484122 General Freight Transit, Long-Distance-Less than Truckload, 484220 Specialized Freight (except Used Goods) Transit, Local, 484230 Specialized Freight (except Used Goods) Transit, Long-Distance
Suggested Workers Compensation Codes: 7228, 7229, 7230, 7231, 7232.
Description for 4212: Local Trucking without Storage
Division E: Transportation, Communications, Electric, Gas, And Sanitary Services |
Major Group 42: Motor Freight Transportation And Warehousing |
Industry Group 421: Trucking And Courier Services, Except Air
4212 Local Trucking without Storage: Establishments primarily engaged in furnishing trucking or transfer services without storage for freight generally weighing more than 100 pounds, in a single municipality, contiguous municipalities, or a municipality and its suburban areas.
Baggage transfer
Carting, by truck or horse drawn wagon
Debris removal, local carting only
Draying, local: without storage
Farm to market hauling
Furniture moving, local: without storage
Garbage, local collecting and transporting: without disposal
Hauling live animals, local
Hauling, by dump truck
Local trucking, without storage
Log trucking
Mail carriers, bulk, contract: local
Refuse, local collecting and transporting: without disposal
Rental of trucks with drivers
Safe moving, local
Star routes, local
Truck rental for local use, with drivers
Trucking timber
Description for 4213: Trucking, Except Local
Division E: Transportation, Communications, Electric, Gas, And Sanitary Services | Major Group 42: Motor Freight Transportation And Warehousing | Industry Group 421: Trucking And Courier Services, Except Air
4213 Trucking, Except Local: Establishments primarily engaged in furnishing “over-the-road” trucking services or trucking services and storage services, including household goods either as common carriers or under special or individual contracts or agreements, for freight generally weighing more than 100 pounds. Such operations are principally outside a single municipality, outside one group of contiguous municipalities, or outside a single municipality and its suburban areas.
Long-distance trucking
Over-the-road trucking
Trucking rental with drivers, except for local use
Trucking, except local
Description for 4214: Local Trucking with Storage
4214 Local Trucking with Storage: Establishments primarily engaged in furnishing both trucking and storage services, including household goods, within a single municipality, contiguous municipalities, or a municipality and its suburban areas.
Furniture moving, local: combined with storage
Household goods moving, local: combined with storage
Trucking, local: combined with storage
Federal Motor Carrier Safety Administration Information
- Federal Motor Carrier Safety Administration (FMCSA) – The Federal Motor Carrier Safety Administration’s primary mission is to prevent commercial motor vehicle-related fatalities and injuries.
- Safer System – The FMCSA Safety and Fitness Electronic Records (SAFER) System offers company safety data and related services to industry and the public over the Internet. Users can search FMCSA databases, register for a USDOT number, pay fines online, order company safety profiles, challenge FMCSA data using the DataQs system, access the Hazardous Material Route registry, obtain National Crash and Out of Service rates for Hazmat Permit Registration, get printable registration forms and find information about other FMCSA Information Systems.
- FMCSA Forms – All forms needed for the Federal Motor Carrier Safety Administration.
- Update MCS 150 – Form MCS-150 and Instructions – Motor Carrier Identification Report.
- How does CSA work? – CSA (Compliance – Safety – Accountability) re-engineers the former enforcement and compliance process to provide a better view into how well large commercial motor vehicle carriers and drivers are complying with safety rules, and to intervene earlier with those who are not.
Congratulations on running your trucking company as a LLC. It appears to be the best way to operate considering all of the other stuff you have to deal with. We have you covered from one truck to fleets up to 40 units.