What it is?

Buying or leasing a truck is a huge investment.  For many truckers, investing in a truck means putting up most or all of their savings.  Most people don’t have enough savings to replace their truck if it were to be totaled.  This is where physical damage insurance kicks in and replaces or fixes your truck if it’s wrecked in an accident.

Physical Damage Insurance covers your truck if it is damaged. It consists of two different parts, Collision and Comprehensive.

  • Collision – This part of the coverage pays for damage to your truck when it collides with another vehicle or object.
  • Comprehensive – This pays for almost every other peril your truck might face such as vandalism, fire and theft.

Key considerations

1) Actual cash value (ACV)

When you have a claim, Truck insurance companies pay based on actual cash value of your truck. This is exactly like it sounds. It’s the market value of your truck. In personal lines of insurance some companies offer replacement value. Unfortunately this is not an option for commercial policies. Truck insurance companies will pay the lesser amount between the ACV and the Stated amount.

2) Stated Amount

If you elect to add comprehensive insurance to your policy you will have to provide the stated amount, which is your statement of the value of your truck. Your premium for Physical Damage is largely driven by the value of your truck. A good truck insurance agent will help you value your truck and take into consideration the mileage of your truck, upgrades, make and model, and comparable sales data. The Truck Blue Book is also a handy source in valuing your truck.

3) Picking the Right Amount

It’s crucial to provide an accurate stated amount. Since the insurance company pays the lesser of ACV and the Stated Amount, it does you no good to value your truck higher than it’s actually worth. Because this is typically one of the more expensive coverages, taking some time to make sure that you aren’t over insuring your truck can save you big on your premium.

4) Deductible

Besides the Stated Amount, your deductible is the other driving force of your premium. Raising your deductible will of course lower your premium. Find an amount that you are comfortable with. You shouldn’t raise it too high to where you couldn’t meet the deductible in the case of a loss.


A basic trucking physical damage policy may have holes in it that can be covered through endorsements (extra premium for extra coverage). Some of the endorsements that you might consider are:

  • Having a single deductible for your truck and your trailer
  • Chains, Tarps, and other Binder coverage
  • Personal belonging coverage
  • Electronic Equipment coverage
  • Paying for a rental truck while yours is getting fixed after a claim
  • Increased towing limits

Let Us Help You.

You may have a used, older model truck that you got a great deal on.  If you lost the truck in an accident, fire, or some other way, there is no guarantee that you will find that same great deal when you have to replace it.