Common Endorsements in Trucking and Logistics Insurance and How They Close Coverage Gaps

The U.S. trucking and logistics sector relies on a set of core insurance products—auto liability, motor truck cargo, and physical damage—plus dozens of endorsements that tailor policies to real-world exposures. This article explains the most common endorsements used by carriers, owner-operators, brokers and 3PLs across major U.S. markets (e.g., California: Los Angeles, long‑haul Texas lanes through Dallas/Houston, and Midwest hubs like Chicago), how they close coverage gaps, typical limits and the cost impacts to expect.

For background on how liability, cargo and physical damage interrelate, see Trucking and Logistics Insurance 101: Breakdown of Liability, Cargo and Physical Damage Coverages. For contingent options and when to rely on them, see When to Use Primary vs Contingent Coverages in Trucking and Logistics Insurance. For cargo valuation questions, consult Cargo Insurance Explained: Limits, Valuation Methods and Typical Exclusions for Carriers.

Sources and market context

• Federal regulatory context and required endorsements: FMCSA (insurance and financial responsibility guidance) — https://www.fmcsa.dot.gov/regulations/insurance
• Carrier market references and insurer product examples: Progressive Commercial (U.S. trucking insurance products) — https://www.progressivecommercial.com/solutions/tractor-trailer-insurance/

Note: premiums vary significantly by state, commodity, driving history, claim record and trailer/tractor values. Owner-operators and small fleets commonly pay in the low‑to‑mid five‑figure range annually for a combined program; single-truck packages frequently range from roughly $6,000–$25,000+ per year depending on coverages and geography.

Why endorsements matter (coverage-gap examples)

Standard trucking policies include core coverages but rarely match every contract requirement, cargo valuation method, lease agreement, or lender stipulation. Endorsements are the surgical tools that:

• Add insured parties (shippers, brokers, lenders) as Additional Insureds and specify obligation order (primary/non‑contributory).
• Attach regulatory or statutory language (e.g., MCS‑90) to ensure responsibility for accident victims.
• Fill exposure holes (e.g., non-owned auto risks, physical damage on newly acquired vehicles, leased trailers).

Common gap scenarios:

• A broker requires primary and non‑contributory coverage—your standard policy is not written that way unless an endorsement is added.
• A leased trailer is damaged under a trailer interchange agreement—the insurer must have a Trailer Interchange endorsement or specific physical damage language.
• A shipper sues for cargo damage under their bill of lading language—the carrier needs specific motor truck cargo wording and the correct valuation basis.

Key endorsements explained (what they do and when to use them)

1) MCS-90 / Endorsement for Federal Financial Responsibility

• Purpose: Attaches a motor carrier’s auto liability policy to FMCSA financial responsibility obligations.
• Typical limits/cost: Does not change your policy limits but ensures insurer responsibility for judgments consistent with federal requirements. Cost is generally built into overall premium; no separate stated premium on the endorsement.
• When to add: Required for interstate for‑hire carriers subject to FMCSA regulations.

2) Motor Truck Cargo (Cargo Endorsement / Policy)

• Purpose: Protects against loss to customers’ freight while in transit or in your custody.
• Typical limits/cost: Common limits are $100,000 per tractor/trailer or declared value per load; premiums vary by commodity, geography and declared value (e.g., high‑value electronics shipments in Los Angeles will cost significantly more than household goods).
• When to add: Must be in place whenever you haul goods you do not own or when required by shippers/brokers.

3) Trailer Interchange / Non-Owned Trailer Physical Damage

• Purpose: Covers physical damage to a trailer you do not own while it is in your care under a trailer interchange agreement.
• Typical limits/cost: Limits typically reflect trailer value (e.g., $20,000–$80,000); endorsements often add a premium based on trailer exposure and interchange frequency.
• When to add: Required when pulling leased or broker‑provided trailers.

4) Hired and Non‑Owned Auto (HNOA)

• Purpose: Extends liability to autos drivers operate but the company does not own (rental trucks, employee personal vehicles used for business).
• Typical limits/cost: Limits mirror your chosen liability limits; premium depends on exposure and state. Important in dense markets like Chicago and Los Angeles where rental use is common.
• When to add: When drivers use personal or rented vehicles for business tasks.

5) Additional Insured — Primary & Non‑Contributory

• Purpose: Provides protection to a contract party (shipper, broker) and forces your policy to respond first.
• Typical limits/cost: Usually mirrors your liability limits; insurers often add a surcharge for primary/non‑contributory language.
• When to add: When a contract or broker requires it.

6) Waiver of Subrogation

• Purpose: Prevents the insurer from pursuing third parties (often the shipper/warehouse) after paying a claim.
• When to add: When a customer or lease requires it—common in logistics contracts.

7) Agreed Value / Total Loss Replacement / GAP Coverage (Physical Damage)

• Purpose: Protects owners against depreciation disputes after a total loss; GAP covers the gap between loan/lease balance and insurer payout.
• Typical limits/cost: Agreed value sets the settlement value; GAP cost is typically a modest percent of vehicle value.
• When to add: For financed or leased tractors/trailers, or when equipment ages rapidly.

8) Occupational Accident (for owner-operators)

• Purpose: Replaces workers’ comp for independent contractors (medical and lost income benefits).
• When to add: Common in owner‑operator lease arrangements where carriers prefer not to offer workers’ comp.

9) Broadform Products / Completed Operations

• Purpose: Extends liability to cover products and completed operations exposures (e.g., cargo contamination).
• When to add: When your operations include warehousing, packing, or processing customer goods.

10) Newly Acquired Auto / Newly Acquired Trailer

• Purpose: Automatically provides coverage for vehicles/trailers recently added to the fleet for a limited window.
• When to add: Ensures continuous protection during fleet turnover while you formalize limits and schedule.

Quick comparison table

Cost & market examples (U.S. locations and insurers)

• Insurer market players: Progressive Commercial, CNA, Great West, Travelers and regional carriers provide trucking insurance and endorsements. Progressive lists tractor‑trailer products and endorsement options that illustrate how carriers tailor packages for long‑haul and regional operations: https://www.progressivecommercial.com/solutions/tractor-trailer-insurance/.
• Premium ranges by program (illustrative, not a quote):
  • Single‑truck owner‑operator (interstate, standard risk, $750K liability, $100K cargo, physical damage with deductible): roughly $6,000–$20,000+ per year depending on state (higher in California and New York, lower in parts of the Midwest).
  • Small fleet (3–10 trucks) with expanded endorsements (primary/non‑contrib, trailer interchange, agreed value): $20,000–$80,000+ annually, depending on tractor/trailer values and cargo types.
  • Note: specialty high‑risk commodities (electronics, pharmaceuticals) or high‑theft corridors (Los Angeles ports, South Texas) materially increase cargo and liability premiums.

For regulatory minimums and financial responsibility context, review FMCSA guidance: https://www.fmcsa.dot.gov/regulations/insurance.

Practical endorsement selection: checklist for buyers (U.S. carriers)

• Review contracts: add Additional Insured and Primary/Non‑Contributory endorsements if required by shippers or brokers.
• Confirm FMCSA compliance: ensure MCS‑90 (or equivalent) is attached for interstate for‑hire operations.
• Match trailer exposure: add Trailer Interchange and/or Newly Acquired Trailer endorsements whenever hauling non‑owned trailers.
• Protect cargo valuation: select Motor Truck Cargo with appropriate declared value and consider sub‑limits for theft-prone commodities.
• Finance protection: add Agreed Value or GAP where tractors/trailers are leased/financed.
• Non‑owned exposures: add Hired & Non‑Owned Auto where employees operate non‑company vehicles for business.
• Contractor relationships: consider Occupational Accident if you engage owner‑operators and avoid workers’ comp classification.
• Request carrier-rated endorsements: always get written confirmation of added endorsements and exact endorsement wording before signing a contract.

Final notes

Endorsements are not optional paperwork—they directly determine whether a claim will be paid and whether contractual obligations will be met. Work with a broker or insurer experienced in your operating region (Los Angeles ports, Texas intermodal lanes, Chicago freight hubs) to bind the correct endorsements and verify primary vs. contingent responsibilities. For a primer on how liability, cargo and physical damage interrelate when building a coordinated program, see How Liability, Cargo and Physical Damage Interrelate: Building a Coordinated Trucking Insurance Program.

References

• FMCSA — Insurance and financial responsibility: https://www.fmcsa.dot.gov/regulations/insurance
• Progressive Commercial — Tractor-trailer insurance solutions and product resources: https://www.progressivecommercial.com/solutions/tractor-trailer-insurance/