Insuring your Cargo Van for Commercial Use is based on:
- How your Cargo Van will be used
- What your Cargo Van will be hauling
- Where your Cargo Van will be driving
If you are an Owner Operator with a Cargo Van or Sprinter Van hauling freight for hire then this Blog is for you.
Learn everything you need to know about insuring your commercial vehicle:
- Types of coverage required
- Limits of coverage required
- What factors affect your premium
- Who currently has the lowest priced Cargo Van and Sprinter insurance
Let’s get started.
What Kind of Insurance Do You Need to Haul Freight for Hire in a Cargo Van or Sprinter?
When you’re using your van for any commercial purpose your insurance will be different than standard auto insurance.
Here’s what you’ll need to consider:
- Commercial Auto Liability Insurance: This covers bodily injury and property damage caused by your vehicle. This is required coverage to legally operate your Cargo Van or Sprinter hauling freight for hire.
- Physical Damage Insurance: This provides coverage for damage to your van for Comprehensive and Collision losses.
- Motor Truck Cargo Insurance: This covers the goods you’re transporting for your customer.
- General Liability Insurance: This protects against risks not directly related to the operation of your vehicle but associated with your business activities. General Liability is not required by FMCSA or your state, but your customer contracts may require it.
Liability Limits for Cargo Van and Sprinter Insurance
The Commercial Auto Liability limits you choose can significantly impact your premiums and the level of coverage you receive. Most commercial policies offer:
- Basic Limits of $300,000
- Industry Standard Limits of $1 million
- Higher Limits for specific contracts or high-risk deliveries
DOT Requirements for Hauling Freight with a Commercial Van or HotShot
A common question is whether you need an FMCSA issued Department of Transportation (DOT) number to haul freight across state lines, or interstate.
- Interstate Operations: Cargo Vans and Sprinters hauling freight across state lines need a DOT number and minimum insurance limits of $300,000 CSL.
- Vehicle Weight: HotShot Insurance is a little different because Duallys with trailer have a combined weight over 10,000 GVW and require a minimum insurance limit of $750,000 CSL.
- State Regulations: Some states may require a DOT number even for intrastate operations.
- Industry Standard Liability Limit: Regardless of FMCSA minimum insurance requirements, industry standard for many industries has settled in at $1,000,000 CSL Commercial Auto Liability.
Cost of Insuring Cargo Vans for Commercial Use
The cost for Cargo Van and Sprinter Insurance varies widely from state to state. Here’s some of the factors that affect your Commercial Insurance premiums:
- Insurance Credit Rating: Poor payment records and debt negatively impacts your premium.
- Year and Value of your Commercial Van: New high valued vehicles cost more to repair or replace which increases your Physical Damage premium.
- Driver’s History and Experience: Clean records and experienced drivers lead to lower costs.
- Radius of Operation: Expediting long haul Owner Operators pay more for for Unlimited Radius, but Last Mile Delivery or Courier premiums are similar due to the exposure of busy city driving.
- Cargo: Hauling refrigerated freight (REEFER), HazMat and other high end freight will increase your Cargo Premium. There are specific EXCLUSIONS to Cargo policies that you need to know.
- More on What Motor Truck Cargo covers.
Because of these variables, it is ALWAYS worth your while to make a quick phone call for an estimate with your professional Trucking Insurance Broker first. She’ll be able to give you a very good ballpark before you take the leap into hauling freight for hire with a Cargo Van or Sprinter.
She will also have access to the latest companies providing top-tier commercial van insurance as detailed below.
Who has the Cheapest Commercial Van Insurance?
There are only a handful of strong competitors providing reasonable insurance premiums for Cargo Vans and Sprinters hauling freight for hire.
This niche has been overlooked by insurance firms due to the misconception that drivers face unique time constraints compared to other trucking types. This notion is unfounded, and a fresh option has finally emerged.
While Progressive has been dominant for the past ten years nationwide there are now other carriers that compete for this segment.
Northland, Brooklyn Specialty and Dynamic Specialty offer some very attractive packages for certain types of risks.
But right now the HUGE story is the GEICO launch into Expediting and Last Mile Delivery operations.
Their new program has already rolled out in Ohio, Indiana, Illinois, Florida, Texas, Arizona, Colorado and South Carolina with more states to follow soon.
CIS is excited to partner with GEICO as an Independent Agent to offer a better option for our Owner Operators and small Motor Carriers.
Right now their rates have been nothing short of spectacular, so jump in for your quote as soon as you can.
CIS: 330-864-1511
We work as your advocate to secure the correct coverage at the lowest price from policy inception through renewal.
Plus, we issue the multiple Certificates of Liability you’ll need, and help you with claims.
Read on for more tips on insuring your cargo van or sprinter for commercial use:
Is a Cargo Van or Sprinter better for Commercial Use
The debate of which is better for hauling freight for hire, a Cargo Van or a Sprinter.
From an insurance standpoint, there is no difference in cost between the two types of commercial vans, it’s the year and value of the unit that drives the core premium.
Consider the size of the van and its capacity to determine what can fit inside.
Here is a much more detailed summary on size and cost for Cargo Vans vs Sprinter Vans.
Required Van Modifications for Commercial Use
Regardless of which type of van you purchase, certain modifications might be necessary in order to haul freight.
The modifications you make to your van have a minimal impact on your Physical Damage premium so make sure the coverage is included on your policy.
- Permanently attached equipment: $2,500 is a common limit added to a Commercial Van hauling freight.
- Examples: Customization including load securing equipment, shelving, custom paint, appliances, electronics, HVAC and Bunk.
- Deductible: The permanently attached equipment becomes part of the Stated Amount of your Commercial Van and subject to only one deductible that you choose for Physical Damage (Comp & Collision).
Remember to tell your Truck Insurance Broker about any new modifications you make to your van.
Do Multiple Drivers affect the Insurance Premium
If multiple drivers use your van, it can impact your insurance in either direction.
- Driver History: Each driver’s record impacts premiums for better or worse.
- Age: Sometimes an older responsible driver can mitigate the higher cost of a younger driver.
All insurance policy contracts state that failing to disclose a driver constitutes insurance fraud and can result in legal disputes over claims. It’s not worth the risk.
Special Driver’s License Requirements for a Cargo Van or Sprinter
Operating a commercially insured cargo van or Sprinter van may require specific licenses:
- Commercial Driver’s License (CDL) is not required to drive an under 10,000 GVW Commercial Van, but some insurance companies include a discount on your policy if you already have a CDL.
- Endorsements for transporting hazardous materials in any size unit and as defined by 49CFR383.5 requires a state issued CDL.
Always check state and federal regulations to ensure compliance for anything remotely HazMat.
Finding the Best Load Boards
For owner-operators looking to haul freight, load boards are invaluable.
Unfortunately for Cargo Vans and Sprinters, these popular Loadboards tend to focus more on large Straight Trucks and Tractor Trailers:
- DAT Load Board
- Truckstop.com
- 123Loadboard
The Best Load Board for Cargo Vans and Sprinters
If your goal is to haul freight for hire with a Cargo Van or Sprinter, your best bet is to start with a reliable Load Board dedicated to Commercial Vans.
My Virtual Freight is a proven 7 year old company that provides a comprehensive solution for Cargo Vans and Sprinters.
My Virtual Fleet stands out in 3 unique ways:
- They share the Results of the Bidding Process
- They teach you how to line item bid
- They teach you how to develop Direct Customers
Their services include a top-notch Load Board, DeadHeading Board, Tracking, Notifications, and Compliance Solution. Leveraging GPS, Google Earth, smartphones, and an advanced accounting module, they enhance productivity and boost profits. With a one-stop approach, they cater to under 10,000 GVW Commercial Vans hauling freight for hire.
Conclusion
Understanding the various aspects of insuring your Cargo Van or Sprinter for commercial use should give you more confidence to take the leap into the Owner Operator arena. But please call us BEFORE you take that leap. We’ll run some preliminary quotes and talk through your plans. We really will help point you in the right direction – we want you to succeed.
Read more about hauling freight for hire with a commercial van at CIS Commercial Truck Insurance Blog for Owner Operators.
When you’re ready to talk we’re here to listen.
Call CIS at 330-864-1511
15 Minutes can Save you BIG $$$ on your Expediting Insurance!
