Non-Trucking Liability – Misunderstood Insurance CoveragesSeptember 13, 2023 12:00 pm
You know you need different types of insurance for your truck. However, if you are like many owner-operators, you might not understand non-trucking liability (NTL) insurance. Capstone can help you understand NTL and its importance to your coverage.
NTL is insurance designed explicitly for owner-operators who are working as independent contractors. It is not for employees. Whenever employees are driving a truck, they are in the course of their employment. However, for independent contractors, not every truck use is on a client’s behalf. Instead, some of it is “non-trucking” time. Your motor carrier’s insurance does not cover you when you are non-trucking.
Even though owner-operators are independent contractors, you get insurance coverage when you lease under a motor carrier. Their FMCSA insurance, which you can find with their Department of Transportation (DOT) number, should cover you when you work for them. They may pay for your commercial auto liability insurance or just some portion. Your contract will determine which one of you pays for that insurance. Generally, they provide the primary commercial auto liability insurance. However, that policy is limited to coverage for accidents that occur while you are performing work for them.
You provide the NTL. That is for when you are not operating on their behalf. Most of the time, you will be acting on their behalf. However, you might drive your truck when you are not working. Usually, this will happen without a trailer attached, which many call Bobtail. In many cases, driving Bobtail will not be on the motor carrier’s behalf. Something similar to NTL used to be called Bobtail, and many people still use that term to describe NTL.
What does it mean to be operating on their behalf? Some people think that NTL covers you when you are not under dispatch. However, many activities are covered that are not under dispatch. Their insurance covers if you are driving to or from their terminal to where you keep your truck. Traveling to get maintenance or repairs is covered by their policy. Their commercial policy covers deadheading. Even getting fuel or washing your truck is covered. They are all necessary to perform your job. That means their coverage may apply even when your truck is empty. It will just be the motor carrier’s unladen liability policy.
It is critical to know that Non-Trucking Liability is not a commercial policy. You cannot use it to cover your truck if you are using it to generate revenue. Instead, it provides coverage for non-business usage. Suppose you want to operate your truck outside of a lease independently. In that case, you will need your own primary commercial auto liability policy.