If you have ever been driving on a major freeway in the US, you already know the prevalence of trucks hauling cargo. In fact, there are approximately 15.5 million trucks on the roads in the US.

80% of these trucks come from a small business with six or fewer trucks on the road.

While big trucking companies can afford to pay for the costs of crashes, small businesses need to take steps to avoid catastrophes. That includes paying for hot shot trucking insurance.

Because you already run a niche service with your hot shot trucking company, the importance of protecting yourself and your equipment is paramount.

Wondering how hot shot trucking is unique from big-rig semis? Read on to learn the ins and outs of hot shot trucking insurance for small business owners and what you should consider as you seek coverage for your hot shot trucks.

What Is Hot Shot Trucking?

Before discussing insurance, it's important to have a common understanding of the niche of hot shot trucking.

Hot shot trucking is unique for several reasons. The truck used is smaller than the larger semi trucks they often compete against. The trucks are usually Class 3, 4, or 5 trucks, which are generally powerful pickup trucks in most cases.

The trucks pull some kind of trailer to haul their load. Often this trailer is an extended flatbed trailer.

Often the hot shot trucks are owner operated versus owned by a company.

It's believed that hot shot trucking got its start in the oil industry in the 1970s. Workers would wait in their own trucks outside of manufacturing facilities. They'd wait for a specific part for the oil rigs.

When the part was ready, instead of waiting for professional trucking services, the part or rig piece would go in the waiting truck and trailer and be driven to the oil well.

When you consider a hot shot truck, it has to be one with enough power and torque to pull freight when needed.

What's a Hot Shot Load in Hot Shot Trucking?

You already know that a hot shot truck is often a heavy-duty pickup truck and utility trailer. They can carry loads smaller than might be necessary to fill a whole semi-truck and make it worthwhile to move a load.

The hot shot truck is a for-hire operation that's ready to move a single piece of cargo when it needs to go.

Hot shot trucking focuses its services on the provision of scheduled and quick delivery services. They can pick up a single load and get it where it needs to go. Often this is with little notice and without needing to fill a full load.

Like the oil rigs that inspired the start of hot shot trucking, now many hot shot loads take parts to locations or job sites to prevent a shutdown or work from slowing down because of a lack of equipment.

The selling point of a hot shot load is that it can move cargo more quickly, cost-effectively, and with less hassle and planning than larger loads of freight.

How Does Hot Shot Trucking Work?

Since hot shot trucking runs with truckers who are one-truck operators and small fleet owners, the operations are different and often more flexible than planning to ship a load in a large rig.

A hot shot trucker is different because they can prioritize shipping small batches of cargo or freight. They can also usually get the load to its location more quickly.

It does bring an element of hustle to the business. Hot shot drivers need to be available when needed. They also need to find a way for those needing their services to know their availability.

Often once a business starts to take advantage of the features of hot shot trucking, they appreciate it and go back. If a business needs freight delivered on a tight deadline or needs to get equipment or cargo for their own business more quickly, hot shot trucking is the route to take.

Who Are Hot Shot Drivers?

When you consider how hot shot trucking works, generally, the drivers fall into one of two categories. You aren't likely to drive on behalf of a business with other trucks or a fleet of trucks.

If that were the case, they'd likely be insuring the truck and trailer as part of the fleet of commercial vehicles.

Instead, a hot shot driver might be an independent driver with a vehicle and who puts himself to work. They have the vehicle and the trailer, along with the correct license to haul the load.

In some cases, hot shot drivers are amateurs looking to make some extra money by hauling a load here or there.

Should You Insure a Hot Shot Business?

There are a host of reasons you need to insure your hot shot business.

The reality, and the statistics, show that a truck accident could happen at any time. In 2020, there were 107,000 large trucks involved in accidents. 4,842 of these accidents involved fatalities.

As an independent contractor working in the commercial realm, you must protect yourself from all liability. You may be hauling a load with a high dollar value.

What happens if you're in an accident, even one that's not your fault, and you have to answer for damages to the load you're carrying? It's the reason there's a unique niche market for hot shot trucking insurance, too.

Who Needs Hot Shot Coverage?

A common industry term used with hot shot trucking is less-than loads or LTLs. Less than loads are simply defined as small cargo loads

As a trucker, do you do the following:

• Carry less-than loads?
• Do you deliver on tight deadlines?
• Do you deliver to a single customer in a load?

These parameters and the standard truck and trailer size define a trucker who works and needs hot shot coverage.

Truck sizes generally include:

1. Class 3 (10,001-14,000 lbs)
2. Class 4 (14,001-16,000 lbs)
3. Class 5 (16,001-19,500 lbs)

The trailers include:

• Lowboy trailers
• Deckover trailers
• 20- to 40-foot gooseneck trailers (common)
• Dovetail trailers (common)

If your truck and trailer fit in the parameters of this description and you're being paid for the services of making deliveries for others, then you do need hot shot coverage.

What Does Hot Shot Insurance Cover?

When you use your truck for commercial purposes, you want to ensure you have it covered.

Are you wondering how hot shot insurance is actually different than the truck insurance you might have in a private policy?

Of course, it will cover your truck and trailer in case of damage. This would include damages if stolen, vandalized, or damaged from a collision or a fire.

Some policies will actually cover potential wages lost while the truck and trailer are down for repairs.

A hot shot policy will also cover property damage. This property damage might occur because of an accident or during a delivery. The insurance would cover the physical damage to the property.

If your hot shot vehicle causes damage to another person from an accident or while on a delivery, the injuries to the other person would be covered. This includes medical bills, lost wages, and other expenses.

Since you're operating as a business, you want to protect yourself legally as such. If you face litigation because of something that occurred while operating your hot shot rig, the legal representation will get covered through this type of insurance.

Finally, it's important to remember that you're not just driving the truck and pulling a trailer. You're also carrying cargo that has value. This cargo also likely doesn't belong to you.

An important part of hot shot insurance is the coverage it provides for the cargo if it's lost, stolen, or damaged while in your possession.

Forms of Hot Shot Trucking Coverage

Hot shot trucking insurance coverage needs to cover all aspects of your business. Let's take a closer look at the specifics your coverage should and could have to protect and keep you covered.

Liability

One required part of your coverage will be liability coverage. Your state may have minimum requirements with hot shot coverage as part of your policy.

Liability coverage covers your liability if there's an accident and someone is injured. It covers the other driver's medical payments and property damage if you cause an accident.

Cargo

One requirement from your vendors and business is that you have cargo coverage. This protects the cargo you're hauling from one place to another.

The cargo coverage protects the load you're carrying from things like:

• Accident damage
• Fire
• Theft
• Vandalism
• Other losses

The NHTSA has minimum federal requirements for cargo coverage. Most businesses will expect you to have higher amounts than the minimum. This is where it's important that you know what you plan to cover.

Comprehensive

Like a private policy, you'll want to have comprehensive coverage. Comprehensive coverage protects your truck and trailer if there's damage that doesn't involve an accident.

You might have damage to your truck for things like:

• Fire
• Theft
• Vandalism
• Other physical causes of loss

You would need comprehensive coverage when there's damage at a time when there isn't an accident. You can vary the amount of comprehensive coverage you have based on the value of your truck.

Collision

Like the name implies, collision coverage protects your vehicle when it's in a collision. Like comprehensive coverage, you can vary the value of your collision coverage based on the value of your truck.

The higher the amount of coverage, the more it will cost.

Collision coverage covers the damages your vehicle incurs when it's hit by another vehicle.

Most insurance policies that have both comprehensive and collision coverage refer to it as full coverage because it protects your vehicle when it's driving and when it's not.

Towing and Storage

Towing and storage is one type of add-on you can get on your policy. It covers your trailer and cargo in a few ways.

If you're in an accident, you are likely to need to be towed for repairs. The towing part of this policy covers the cost of your tow minus the deductible you choose.

Storage coverage pays for the storage of your trailer while any repairs get done.

Loading and Unloading

It's not uncommon for hot shot drivers to carry expensive cargo. One of the most vulnerable times for this cargo is when it's getting loaded or unloaded.

This add-on coverage protects you for any potential damages that might occur when you're either loading up the cargo or unloading it when it reaches its final destination.

Earned Freight

Earned freight coverage is a unique type of add-on insurance for hot shot truckers who may have a situation where they lose income.

You might be in an accident and it prevents you from making the necessary delivery. You might have cargo damaged en route to its final destination. Either way, as a hot shot trucker, you're likely to lose income.

The earned freight coverage helps to provide lost wages in these types of situations.

Bobtail

Bobtail coverage is a specialized form of liability coverage that many hot shot truckers choose to add to their coverage.

It covers your truck when you're driving without the trailer attached, which is called bobtailing.

This coverage also protects your trailer when it's not attached to your truck and the truck is moving without the trailer attached to it.

Downtime

The reality of what you do as a hot shot trucker is that you need your truck and trailer to carry on your work.

So, what happens to your livelihood when your truck or trailer is involved in an accident and you're unable to continue working?

Downtime coverage helps to provide income loss when your truck is down for repairs.

Medical Payments

You already know that liability coverage protects the other driver's medical costs that result from an accident.

Medical payments add-on coverage will help to cover your medical costs from an accident. You might think you have medical insurance, but some medical insurance policies have limits.

Some private medical insurance policies also have limits or won't cover a commercial accident. Medical bills from an accident can add up quickly, so this is one area you don't want to skimp on.

Equipment

You know as a truck driver that you use more equipment than just your truck and trailer.

You need to secure loads. Equipment coverage covers things like your ramps, chains, tarps, tie-downs, and binders if they are lost, vandalized, or stolen.

Debris Removal

It might surprise you to learn that if you're in an accident your cargo may go flying off your trailer and cover the road. The surprising part is that if the accident is your fault, you may be responsible for the cost of cleanup.

Debris removal coverage is particularly important if you carry the type of loads that could cause a huge mess if they came off the trailer.

Broadened Pollution

Another type of add-on liability coverage is broadened pollution coverage. You may have the type of load that is a potential pollutant to the environment or others.

This is a situation where if you carry this type of load, it's extremely important to let your insurance agent know so they can adequately keep you covered from this potential liability.

GAP

It's not uncommon for a driver to have a loan on their truck and trailer used for hot shot trucking.

GAP coverage pays the difference between what your truck is worth and what you owe.

When you buy a vehicle, it depreciates quickly. This protects you so you can replace the vehicle and not be out the difference on the balance of the loan.

Cost of Hot Shot Insurance

If you're like most business owners, for every decision you make you must consider the cost. Insurance coverage is no different.

You need to know that the cost of hot shot insurance is different from insuring your truck for private use. Because it's being used for commercial purposes which increase risk, in the eyes of the insurance company, the cost changes.

Like every insurance policy, the cost of the policy will vary based on the value of what's being insured. The more expensive your truck and trailer, the more costly your insurance.

In general, these are the factors that will impact the cost of your hot shot insurance policy, including:

• Value of the truck you're driving
• Value of the trailer being pulled
• Coverage limits
• Deductible amounts
• Types of coverage included in the policy
• Number of claims
• Type of cargo being carried in a load
• Distance of hauling cargo

Anytime you seek truck insurance for your business, you want to work with an insurance agent who understands what you do. It's also important to be honest about what you're hauling and how far.

You'll only find yourself in a bind if you need the coverage and have been dishonest about what you're hauling with your truck and trailer.

Ways to Reduce Insurance Costs

While the cost of insurance might feel overwhelming, you must have it. The good news is that you can do some things that might help to lower the cost of your policy.

Here are some ways you might find to shave down the cost of your hot shot policy, including:

• Pay a full-year premium all at once, instead of spreading out the payments
• Make an increase on your deductible amount
• Choose a policy limit that's realistic and affordable but still keeps you covered
• Participate in a safety course and driver training course
• Ask your insurance agent about discounts
• Evaluate the coverage to ensure you only have what you need
• Maintain a good credit score
• Practice safe driving

You will also want to be sure to shop around for coverage. You should actually do this yearly. This ensures you're getting the best rate for your driving credentials and needs.

What Will Impact the Cost of Your Insurance?

You also need to know that you as the operator of the hot shot vehicle or drivers you employ will impact the cost of your insurance policy.

Once you understand all the factors that impact your insurance rates, you can do everything possible to keep them lower.

Here are some things that impact the rate you'll pay for hot shot insurance, including:

• Experience as a driver
• Age of the driver
• Driving record
• Claim history as a driver
• Credit score
• Employment history

As you can see, in addition to the coverage and your vehicle, your personal credentials will also have a role in the cost of the coverage.

If you carry a CDL license versus a regular license, it should save you a little, so make sure you mention this to your insurance agent.

Is Hot Shot Coverage Required?

The short answer is yes, you do need hot shot coverage if you're provided with this type of trucking service.

You need the truck protection, personal protection, and property protection that's a part of the hot shot coverage.

All states require you to have insurance on a vehicle. Since this is being used for commercial purposes, your state may have additional requirements.

You should also be aware that most businesses won't want your services unless you're properly covered. They won't want you to carry their valuable cargo with the proper coverage.

Find the Right Insurance Agent to Fit Your Unique Needs

Anytime you're looking for insurance coverage, it's important that you do your homework. Just like when a vendor hires you, they want the best service at the best value.

You want to approach your insurance needs with the same insight. Not all insurance agencies or agents are the same. Hot shot insurance fills a niche market and has unique needs.

You want to hire an insurer who understands your industry and its unique features and needs.

You should expect to work with an agent who wants to know about the work you do and your needs for coverage. They should be willing to consider options to get you the best coverage at the best rate.

All You Need to Know About Hot Shot Trucking Insurance

As a hot shot trucker, you know you work in a unique and growing industry. You also want to protect your business and your truck and trailer with the right hot shot trucking insurance to ensure you're protected.

If you need insurance coverage for your hot shot business, we can help. Contact us today to get more information on how we can help you cover your hot shot trucking needs.