Physical Damage Coverage for Trucks and Trailers: Collision, Comprehensive and Agreed Value Options

Physical damage coverage is a core component of a coordinated insurance program for trucking and logistics operations. For U.S.-based fleets — whether a one-truck owner-operator in Texas, a regional fleet in Illinois, or a long-haul carrier based in California — choosing the right collision, comprehensive, and agreed value options affects downtime, repair decisions, finance compliance and total cost of risk.

This article explains what each option covers, typical limits and deductibles, when each applies, how they interrelate with liability and cargo coverages, and practical buying guidance for carriers operating in the USA.

Related resources:

• Trucking and Logistics Insurance 101: Breakdown of Liability, Cargo and Physical Damage Coverages
• How Liability, Cargo and Physical Damage Interrelate: Building a Coordinated Trucking Insurance Program
• Common Endorsements in Trucking and Logistics Insurance and How They Close Coverage Gaps

What "Physical Damage" means for trucks and trailers

Physical damage coverage for commercial autos generally breaks into two core coverages:

• Collision — covers loss or damage to the insured vehicle resulting from collision with another vehicle or object, or from overturn. Applies to tractors, straight trucks, and trailers (if insured).
• Comprehensive (also called Other Than Collision) — covers non-collision perils such as theft, vandalism, fire, glass breakage, falling objects, flood, and most animal strikes.
• Agreed Value — is a valuation option or endorsement that fixes the settlement amount for the covered vehicle (rather than paying Actual Cash Value). Common for new tractors and higher-value specialized trailers where ACV creates a “coverage gap.”

Regulatory note: motor carriers must meet minimum financial responsibility for liability per FMCSA rules; physical damage is optional but often required by lenders, lessors and shippers. See FMCSA insurance guidance: https://www.fmcsa.dot.gov/regulations/insurance

Collision vs Comprehensive vs Agreed Value — side-by-side

Typical values, limits and deductible strategies (USA market examples)

• Vehicle values (typical U.S. market ranges):
  • Class 8 tractors (new): approximately $120,000–$200,000+ depending on spec and emissions package. (See manufacturer model lines and pricing trends at major OEMs such as Freightliner: https://freightliner.com/.)
  • 53’ dry van trailers (new): $30,000–$70,000+ depending on make and features (e.g., aluminum floor, liftgate). (See Utility Trailer and other OEMs: https://utilitytrailer.com/.)
• Common physical damage deductibles: $500, $1,000, $2,500, $5,000. Larger fleets often choose higher deductibles to lower premium exposure; smaller operators often keep $1,000 or less.
• Policy limits: Physical damage is generally written to the full value of the vehicle (ACV or agreed value). Lenders/lessors typically require full coverage limits equal to loan value; lease/finance contracts frequently demand agreed value or loss-payee endorsement language.

Pricing snapshot — market estimate ranges (U.S., 2024 market context):

• Owner-operator single long-haul tractor (full physical damage) — $6,000–$18,000 per year depending on vehicle value, operations, state, driving record and deductible.
• Small regional/local straight truck (physical damage) — $3,000–$9,000 per year.
• Trailer physical damage coverage (per trailer, annual) — $400–$2,000+, based on value, use and location.

These ranges are market estimates that reflect typical premium drivers: vehicle value, territory (e.g., California and New York tend to have higher premiums), driver experience, safety program, cargo type and deductible selection. For carrier-specific pricing, major carriers include Progressive Commercial, GEICO Commercial, Great West Casualty and Sentry — each will underwrite differently. Progressive’s commercial physical damage resources: https://www.progressivecommercial.com/coverage/physical-damage/; general commercial auto overview: https://www.iii.org/article/commercial-auto-insurance

When to use Agreed Value vs ACV

• Use Agreed Value when:

  • Vehicles are new or custom-upfitted and you want predictable settlement (avoids depreciation disputes).
  • The truck/trailer is financed/leased and lender requires no gap between loan balance and settlement.
  • You operate high-value specialized equipment (tankers, reefers with expensive refrigeration systems, ADR-mandated units).

• Consider ACV when:

  • Equipment is older and replacement cost has naturally depreciated.
  • You want lower premiums and accept some risk of “short pay” at total loss.

Practical tip: Combine agreed value with an equipment schedule and regular valuation updates (6–12 months) to avoid over- or under-insurance. Misstating value can void an agreed value settlement.

How physical damage fits with liability, cargo and contingent coverages

• Physical damage covers the fleet’s own assets; it does not pay third-party injuries or property damage — that’s auto liability. See: Understanding Auto Liability for Trucking Fleets: Limits, Split Policies and When It Applies.
• Cargo insurance covers loss to freight in transit; a trailer left unattended that’s stolen may trigger both trailer physical damage and cargo coverage depending on policy wording. For cargo valuation and exclusions, see: Cargo Insurance Explained: Limits, Valuation Methods and Typical Exclusions for Carriers.
• Contingent and secondary policies (e.g., contingent physical damage or non-owned trailer coverage, trailer interchange) are critical where trucks pull customer-owned trailers or operate under broker loads. See: Contingent and Secondary Coverages Every Carrier Should Know: Freight Broker, Motor Truck and Garage Liability.

Endorsements and common gaps to watch

• Agreed Value endorsement (schedules vehicle at a fixed amount).
• Listed/non-owned trailer coverage — important for carriers that frequently haul customer trailers.
• Trailer interchange — covers damage to trailers under interchange agreements; limits, deductibles and who’s primary must be clearly negotiated.
• Rental reimbursement / downtime coverage — pays for substitute equipment or business interruption while repairs are made.
• Specified perils or named storm endorsements in coastal California/Florida operations — check geographic exclusions and wind/hail sublimits.

Refer to: Common Endorsements in Trucking and Logistics Insurance and How They Close Coverage Gaps.

Buying tips for U.S. carriers (California, Texas, Illinois focus)

• Schedule high-value tractors and reefers on agreed value if lender or owner requires no-gap protection.
• Use higher deductibles for low-frequency, high-severity fleets to reduce premium, but ensure cash reserves for claims.
• Maintain a current equipment schedule with VIN, mileage and appraised value — insurers rely on accurate schedules for agreed value.
• Compare multiple markets: Progressive and GEICO Commercial are strong for standard long-haul and owner-operators; specialty markets like Great West Casualty and Sentry often write higher-risk accounts but with stricter safety/maintenance conditions.
• For operations in auto-litigious or high-theft states (e.g., CA, NY, IL), expect elevated premiums and review endorsements for glass, theft and hired/non-owned exposures.

Quick checklist before you buy

• Do you need agreed value for lender/lessor compliance?
• Are trailers scheduled and covered for interchange/non-owned exposures?
• Is downtime/rental reimbursement included? If not, what is the daily sublimit?
• Are deductibles aligned with your cash flow and self-insured retention strategy? See: Typical Policy Limits and Deductible Strategies for Trucking and Logistics Insurance Buyers.
• Confirm loss payee wording matches finance or lease contracts.

Sources and further reading

• Federal Motor Carrier Safety Administration — Insurance Requirements and Guidance: https://www.fmcsa.dot.gov/regulations/insurance
• Insurance Information Institute — Commercial Auto Insurance overview: https://www.iii.org/article/commercial-auto-insurance
• Progressive Commercial — Physical Damage coverage overview: https://www.progressivecommercial.com/coverage/physical-damage/
• Freightliner (vehicle model lines and OEM specs): https://freightliner.com/
• Utility Trailer (trailer product lines and specifications): https://utilitytrailer.com/

If you need a sample valuation worksheet or a downloadable agreed-value endorsement checklist tailored to California, Texas or Illinois fleets, request it and I’ll prepare a state-specific template.