Switching to US insurance company


New Member

We are a Canadian carrier and we are planning to expand our business and open up a division in NY state. When this is done we want to switch from Canadian insurance company to the insurance company in USA. Do you know what are the requirements to have the trucks insured in USA? Is opening a branch in US and renting a warehouse (office) sufficient to be eligible for US insurance?
Do you know if US insurance is much cheaper than Canadian? Is it worth the hassle?
I will appreciate your help.


Site Supporter
If you're making this move just to save some money on vehicle insurance, I would re-consider. By opening a US division you would now be subject to IRS reporting, state tax reporting, workers compensation requirements for all of your US employees, etc., etc., etc. I would guess that your trucks would have to be plated in NY with a NY address in order to obtain insurance from a US based insurer. A move that requires much consideration, and I would think that cheaper vehicle insurance would only play a very small role in that decision.


New Member
Yes it is much cheaper and you will have a wider choice of insurance carriers. Whether or not, it is the right move for you and your company, is something to be discussed with your lawyer and financial advisors that have cross border experience. Once you get the full picture of your legal responsibilities and financial impact, you will be able to make a more educated decision. If you decide it is for you, then work on your business plan and operational execution to assess if you can deploy the human and capital resources needed without a negative impact on your present ops.

Every state is different by the way. I know Michigan is very friendly to Canadians, but I don't know about NY. Bottom line, you can have a U.S. entity, owned by a Canadian corp, with its own MC #, US address, etc...then hire Canadian O/Ops, plate the trucks in the U.S and hold the ownership in Canada. Most finance companies allow it, the US insurance companies are ok with it and the state of MI is happy as long as they collect their dues.

One more thing, you will save money in licensing as well, since you will not be subject to IRP costs anymore. There is a lot more to the subject. If you need help, send me a PM and I'll be happy to point you in the right direction.

Good luck.


Site Supporter
We have talked about it in the past and you would have to have separate insurance for your Canadian and US fleet we where told you would not be able to insure them together as one.
Thanks for your comments. We kind of put it on hold for now but we probably get back to this idea after New Year's. Do you know how it works with the interstate loads if we have a branch in US? Are my Canadian drivers eligible to carry interstate loads in US or they have to be US Citizens in order to do that? I heard different opinions about that...


Well-Known Member
I would think that having an office in the U.S would not make any difference as far as your ability to interstate with Canadian drivers. This is more of a U.S immigration rule than a Transportation rule.
If opening an office allowed that I would imagine that every carrier in Canada who hauls in and out of the U.S would already have one.

Michael Ludwig

Well-Known Member
Thanks for your comments. We kind of put it on hold for now but we probably get back to this idea after New Year's. Do you know how it works with the interstate loads if we have a branch in US? Are my Canadian drivers eligible to carry interstate loads in US or they have to be US Citizens in order to do that? I heard different opinions about that...
Definitely NOT. Regardless of whether or not you have a U.S. office in addition to your Canadian office, Canadian drivers cannot engage in interstate commerce. More to the point, if you have a U.S. office and engage Canadian drivers in interstate commerce you risk far more than the $400.00 fine you will get if you are solely Canadian and get caught inter-stating. There is a pretty good chance you will end up with a government sponsored vacation courtesy of the U.S. Immigration Department who will in turn drop a dime to their colleagues at the IRS.

Assuming you are properly licensed and registered for Canadian domiciled carrier operations in the United States, there are only three (that I am aware of) very specific ways a Canadian carrier can move freight point-to-point in the United States;
1) The cargo is of Canadian origin, and has not been enhanced in value ... i.e.: Canadian product in storage in the United States.
2) The Canadian driver has a U.S. Green Card (good luck in applying for one of those), or dual citizenship.
3) The driver is a card carrying North American aboriginal.
The part that really hurts is if you are properly licensed and registered for U.S. commerce, it is perfectly legal for your equipment to engage in interstate commerce, it's just your Canadian drivers that can't do it.

Have we all engaged in interstate commerce as a Canadian carriers? I seriously doubt that anyone would answer that question honestly, but I would guess that everyone has done it at least once. It's a $400.00 fine/bond for getting caught, and your driver gets red-flagged for a while, which means he gets checked every time he crosses the border, professionally and privately ... discretionary short-arm inspection included at no extra cost. The fact that I know this should lead you to the answer of how I know this ... wink, wink, nudge, nudge :)

The cabotage rules in the U.S., as they pertain to Canadian carriers, are a pretty tricky minefield. Keep this in mind ... technically it is illegal to move your empty trailer from Dallas to Laredo, or El Paso, or Atlanta for a reload to Canada, because they are not on a direct route to Canada, but it is not illegal to move to Little Rock, because that is on a direct route back to Canada ... and these are the relaxed rules. At one point in time the only legal way to get back out of the US to Canada was to reload out of the exact same place you unloaded at.

As a point of interest, it is perfectly legal for a U.S. carrier to deliver a load from anywhere in the U.S. to Toronto, reload in Montreal and deliver to Vancouver, pick up a load in Vancouver and go back to the U.S. This is called a repositioning move. Thank you Transport Canada for that one. The reverse is not true for a Canadian carrier delivering into the U.S.

My own personal opinion ... I have to assume you are pretty new to this industry, or at least U.S. commerce. The questions you are asking are basic Trucking 101 questions. This particular subject has been scrutinized by every major and minor carrier in Canada, and every transportation lawyer on either side of the border, six ways from Sunday. You're not onto something new, or something that everyone else hasn't already thought of. However, I sure wish we could all do what you've been thinking of. Eventually the driver shortage is going to dictate that the U.S. will have to allow Canadian carriers loaded repositioning moves in the U.S. if for no other reason than to keep the store shelves full. We can always hope that this will be sooner rather than later ... who knows ... they're making nice with Cuba again :)


Active Member
It's funny but if you watch the market the rules change. I personally worked for an American carrier but was based out of Alberta in the early 80's. We were allowed and did it on a weekly bases to reload say out or Houston back up into Colorado or Wyoming then bounce to Greybull for a load of mud back to Alberta ( By the way pays same rate today as 1980 imagine that). The thought back then was your reloading only once but in the general direction of home base, sounds like the most reasonable thing to do and should continue today based on the tree huggers worrying about Greenhouse Gases. THEN reregulation, more trucks less freight, the Americans bitched end result no more Interstate loads. You sat and waited for a reload sometimes 3 weeks out of Houston. In my opinion it has been and always will be the American Way or No Way.

Michael Ludwig

Well-Known Member
"American Way or No Way" is very true, however, they can't maintain that attitude forever.
Something to keep in mind ... In all of human history no republic has ever lasted more than 300 years. The United States is 239 years old, and by the looks of its government today, one has to wonder if it will see its 250th birthday.


Members online
Guests online
Total visitors