As an owner-operator with your own authority, you're not just a driver-you're the CEO of your own company. And a CEO's number one job is managing risk.
Many new carriers think their "trucking insurance" is a single policy that covers everything. This is a financially catastrophic mistake. The truth is, you face two very different types of risk: the risk of an at-fault accident on the road and the risk of a non-driving accident at a dock or office. These two risks are covered by two completely different policies: Primary Auto Liability and General Liability.
Confusing them can leave your business exposed to six-figure lawsuits that your main policy won't touch. This guide is a no-fluff breakdown of what each policy does, why you need both, and how to protect the business you're working so hard to build.
The Core Differences
- Primary Auto Liability (PAL): This is for the ROAD. It is federally mandated and covers damage your truck causes to other people or vehicles in an at-fault accident.
- General Liability (GL): This is for the DOCK. It is not required by the FMCSA but covers non-driving business risks, like your driver damaging a shipper's property or a customer slipping and falling near your operation.
- The Critical Gap: Your PAL will not pay if your driver damages a warehouse loading dock. Your GL will not pay if you rear-end a car on the highway.
- The Requirement: The FMCSA requires PAL. Most brokers and shippers, however, will require you to have both to get a load.
What is Primary Auto Liability (PAL) Insurance? (The "Must-Have" for the Road)
This is the policy that lets you legally operate.
What It Is (In Plain English)
Primary Auto Liability (PAL) is the non-negotiable, federally-mandated insurance for all motor carriers operating under their own authority. It pays for two things when you are at fault in an accident:
- Bodily Injury: Medical bills and other costs for people you injure.
- Property Damage: The cost to repair or replace the other person's vehicle or property (like a guard rail or fence) that your truck damages.
The Federal Minimum vs. The Business Reality
The FMCSA requires a minimum PAL limit of $750,000.
This is not enough. No serious shipper or broker will give you a high-value load with the federal minimum. The industry standard, and what you will be required to show on your Certificate of Insurance (COI), is $1,000,000 (one million) in Primary Auto Liability coverage.
What Primary Auto Liability Does NOT Cover
This is the part that sinks new businesses. Your PAL policy does not cover:
- Damage to your own truck (that's Physical Damage coverage).
- Damage to the cargo you are hauling (that's Motor Truck Cargo coverage).
- Any non-driving incident, like damaging a dock or a customer injury.
What is General Liability (GL) Insurance? (The "Must-Have" for the Business)
If PAL protects you on the highway, General Liability protects you everywhere else.
What It Is (In Plain English)
General Liability (GL) insurance covers your trucking business from lawsuits related to its non-driving operations.
Think of it as "business operations" or "slip-and-fall" insurance. While not required by the FMCSA, most shipper and broker contracts now demand it.
Real-World Scenarios Where GL Saves Your Business
Your Primary Auto Liability policy would deny all of these claims, but a General Liability policy is built for them:
- Property Damage During Loading: Your driver is backing into a tight dock and misjudges, crushing a $10,000 roll-up door at the shipper's warehouse.
- Customer Injury: A broker or shipping manager comes to inspect your trailer and slips on a step, breaking their wrist.
- Libel or Slander: You get in a heated dispute with a receiver and falsely accuse them of "running a crooked operation" in a public setting, and they sue your business for slander.
- Mistaken Delivery: You drop a load at the wrong warehouse, and it's stolen before the error is caught.
At-a-Glance: Primary Auto Liability vs. General Liability
Here is a simple breakdown for comparing the two policies.
| Feature | Primary Auto Liability (PAL) | General Liability (GL) |
|---|---|---|
| Main Purpose | Covers at-fault accidents while driving. | Covers non-driving business operations. |
| Example Coverage | You rear-end a car on the highway. | Your driver damages a shipper's dock. |
| Another Example | Your truck jackknifes and hits another vehicle. | A customer slips and falls on your property. |
| FMCSA Required? | Yes. (Federally Mandated) | No. |
| Broker Required? | Yes. (Typically $1M limit) | Often. (Increasingly common in contracts) |
Your Questions Answered: "People Also Ask" FAQs
A: This is your most significant insurance expense. For a new authority, expect to pay between $5,000 and $12,000 per year per truck. This depends heavily on your driving record, state, radius, and truck type.
A: GL is far more affordable. On average, it costs between $500 and $2,000 per year. The cost depends on your business size and perceived risk.
A: Yes. As a for-hire carrier, you absolutely need both. Your PAL keeps you legal on the road, and your GL keeps you from being bankrupted by a non-driving mistake and allows you to sign contracts with good brokers.
A: You face two major risks:
1. Contract Denials: You will be ineligible for loads from brokers and shippers who require GL.
2. Out-of-Pocket Lawsuits: If a non-driving accident happens (like the examples above), you will pay for the damages and legal fees entirely out of your own pocket.
A: Technically, yes, but it doesn't make sense for an active carrier. Freight brokers or dispatchers might buy standalone GL, but if you are operating a truck, you must have PAL.
A: Yes. Bundling your policies through a specialized agency like Logrock simplifies your insurance process and often results in a lower overall premium.
Stop Guessing. Build a Real Policy.
Your policy shouldn't be a "one-size-fits-all" package. Both Primary Auto Liability and General Liability are vital tools for protecting your trucking business from two very different, and very real, types of risk.
Skipping a $500/year GL policy to "save money" is a rookie mistake that could cost you a $50,000 lawsuit for a damaged dock door. A professional business owner protects all angles of their operation. At Logrock, we help you compare carriers, bundle coverage to lower costs, and stay DOT-compliant and contract-ready.
Get a Custom Quote for Your Business
Don't leave your business exposed. Let our specialists build a policy that protects you both on the road and at the dock.
