Insurance Coverage Litigation: Common Disputes Over Trucking Policy Wordings

Trucking and logistics participants in the United States — from owner-operators in Houston to national fleets in Los Angeles and Chicago — routinely face high-stakes litigation driven by unclear or contested insurance policy wording. This article explains the most common coverage disputes, how they arise, and practical strategies litigators, claims teams, and risk managers use to resolve them. Focus is on U.S. law and commercial trucking market realities.

Table of Contents

Why trucking policy wording disputes matter

Large-truck collisions frequently produce catastrophic injuries, trucking cargo losses, and multi-million-dollar liability exposures. Regulators and industry data underscore both frequency and severity (see FMCSA crash and safety statistics).
Source: FMCSA — https://www.fmcsa.dot.gov/safety/data-and-statistics
Commercial trucking insurance costs vary widely by driver history, tractor type, cargo, and geography. Owner-operators and small fleets often report annual premiums between $8,000 and $30,000 per power unit for primary liability and standard coverages; high-risk units in states like California can exceed $50,000/year. National carriers and preferred-risk fleets often buy larger programs that scale differently. Industry advocacy and broker resources summarize these ranges.
Source: OOIDA and carrier market data — https://www.ooida.com/
Regulators and market analysts (NAIC) track commercial auto premium trends and loss development that feed litigation and settlement dynamics.
Source: NAIC — https://content.naic.org/

The policy clauses most often litigated

Below is a practical rundown of policy wording areas that generate the most coverage fights in trucking claims.

1. Who is an insured? (Named insured, additional insured, permissive users)

Dispute: whether the injured party’s claim arises from the named insured’s use or from an excluded/non-permitted operator (e.g., driver-for-hire vs. independent contractor).
Common friction points:

Broad definitions that include “you and any person or organization you permit to use your covered auto” vs. narrow “employee only” language.
Additional insured endorsements negotiated in broker/shipper contracts that insurers dispute as extending coverage beyond policy intent.

See related guidance on additional insured status and contractual risk transfer: Contractual Risk Transfer: When Additional Insured Status Helps — and When It Doesn’t

2. Duty to defend vs. duty to indemnify

Dispute: insurer accepts defense but later denies indemnity; or denies defense altogether. Courts in many jurisdictions treat the duty to defend more broadly than indemnity — but wording, extrinsic evidence, and interplay with indemnity claims drive litigation.

3. “Use” and “Movement” exclusions (operation vs. loading/unloading)

Dispute: coverage exclusions for operations during loading/unloading, or for accidents occurring when the vehicle is not “in transit.” These disputes often arise in premises liability claims at warehouses or when cargo shifts cause injury.

4. Motor Carrier Act endorsements and MCS-90

Dispute: MCS-90 endorsements (and state equivalents) can create third-party rights and obligations independent of policy wording, triggering coverage/lability questions where policy otherwise excludes exposure.

5. Employee conduct and criminal acts exclusions

Dispute: insurer cites intentional act or criminal-acts exclusion; injured plaintiff argues conduct was negligent, not punitive. Jury verdicts awarding punitive damages raise conflicts about whether punitive damages are insurable under state law and policy wording.

6. Cargo exclusions, contamination & pollution endorsements

Dispute: cargo damage vs. property damage to third parties; pollution exclusions are litigated after fuel spills or hazardous cargo incidents.

Typical insurer vs. insured positions (comparison)

Policy Clause	Insurer Position	Insured/Claimant Position
Named Insured / Additional Insured	Coverage limited to named entities; endorsements interpreted narrowly.	Broad reading that includes permissive users, subcontractors, and additional insured endorsements granted in contracts.
Duty to Defend	Interpret complaint narrowly; deny defense where allegations fall outside insuring agreements.	Courts should consider all allegations and facts known to insurer — duty to defend is triggered by any potentially covered claim.
Loading/Unloading Exclusions	Exclusion bars coverage once vehicle is stationary and cargo is being handled.	Injury arose from negligent vehicle operation or dangerously loaded cargo — coverage applies.
MCS-90 / Public Liability	MCS-90 imposes financial responsibility beyond policy wording.	Policy exclusions cannot negate MCS-90 obligations to injured third parties.
Intentional/Criminal Acts	Exclude intentional, expected or criminal conduct; no coverage for punitive damages.	Plaintiff claims negligence, not intentional act; punitive damages not automatically excluded under state law.

Litigation phases where wording fights happen

Coverage tender and reservation of rights letters — insurer’s initial position frames litigation.
Early declaratory judgment (coverage) actions filed by insurer or insured; often fought in federal or state court depending on parties and amounts.
Motion practice over extrinsic evidence (e.g., whether the court may consider facts beyond the complaint).
Expert disputes over industry custom (e.g., broker-carrier relationships, standard endorsements).
Settlement or trial: unresolved coverage can impede defense and settlement, raising exposure for the insured if indemnity is later denied.

Real-world pricing and market players (U.S. focus)

Major trucking-focused writers include Progressive, Great West Casualty (Berkshire Hathaway group), and specialized regional mutuals. These companies underwrite large fleets and owner-operators differently. Broker channels (e.g., Marsh, Aon) place complex accounts, often layering policies and reinsuring large limits.
Typical U.S. pricing (illustrative ranges based on market sources and carrier quote trends):
- Local straight trucks (regional distribution) in Dallas/Houston: roughly $6,000–$15,000 per truck/year for basic liability plus physical damage and cargo, depending on limits and CSA score.
- Long-haul over-the-road tractor-trailers based in Southern California or I-80 corridor (Chicago hub): $10,000–$30,000+ per power unit/year for higher limits and younger drivers.
- Owner-operators with poor driving records or hazmat freight (California/Interstate) can see premiums $25,000–$75,000/year or more.
These ranges are market patterns; brokers and carriers produce firm quotes after underwriting review. For market trend analytics and premium data, see NAIC and carrier market studies.
Sources: NAIC — https://content.naic.org/ ; OOIDA — https://www.ooida.com/

Litigation defense strategies to limit exposure

Prompt, clear coverage letters and early declaratory action when appropriate to define obligations and control costs.
Pursue extrinsic evidence where permitted to show underlying facts are outside coverage — or conversely, to show allegations implicate coverage.
Negotiate reservation of rights with a defense control and selection protocol; use independent counsel or panel counsel agreements.
Force multiparty settlements structure (limit releases only to covered parties) to preserve indemnity claims against non-covered defendants.
Leverage ADR and mediation early to limit defense spend; see: Using ADR and Mediation to Resolve Trucking Liability Claims Without Costly Trials

Practical tips for contract drafting and risk transfer

Clearly define additional insured status and scope (time-limited, work-specific) and confirm endorsements are attached and mirror intended risk transfer.
Draft indemnity clauses to align with policy terms; avoid assume-the-risk language that insurers will not cover (see: Drafting Indemnity Clauses: Protecting Freight Brokers and Carriers from Contractual Risk).
For fleets, implement employment-screening and retention protocols to reduce negligent hiring risk and potential denial defenses: Negligent Hiring and Retention: Legal Traps That Increase Trucking Insurance Exposure

Conclusion

Coverage disputes over trucking policy wording are predictable, costly, and frequent — especially in high-exposure states and corridors like California (Los Angeles), Texas (Dallas/Houston), and Illinois (Chicago). Clear contract drafting, aligned endorsements, and proactive claims handling (including early declaratory relief when necessary) reduce litigation friction. Risk managers and defense counsel should coordinate closely with brokers and carriers — and understand market pricing trends and carrier practices — to control financial exposure and resolve coverage fights efficiently.