Non-owned auto coverage

[Pablo]

Are there any other brokers that have non-owned auto coverage? Looking for some best practise advice here.

We have non-owned auto coverage. For years we've convinced the underwriter to base it on the difference between what we bill and what we pay the carrier ie: the charge for our services (margin). We traditionally have paid about $1200 a year for this. Now they want to base it on our full contract cost. It's going to be about $12,000 a year. I've got a huge problem with this basis as this portion of revenue is already insured by the carrier and furthermore, includes fuel. Imagine the cost of insurance is based on the fluctuations in the cost of fuel, not the risk. It just doesn't make sense to me.

How do other brokers handle this?

 

[TRUCKIT]

I am not sure why you would want this type of Insurance as a Broker. This coverage is usually provided under the Carriers policy. I would think all you need is Contingent Cargo coverage in an amount sufficient to cover your average load value. You can pay the high premium if you want but I would bet the Insurance provider will do everything possible to deny any liability on your part in the event of a claim.

Interesting topic!

 

[Pablo]

You're right..

It absolutely doesn't cover anything. We'd be more likely to win this friday's Lotto Max jackpot then ever claim anything under this policy. However, we have a couple of our major customers that absolutely require it. I'm kind of stuck between a rock and a hard place.

 

[lowmiler88]

Maybe you can offset the large bill with a large deductable and make everyone happy.

 

[bad_spellur]

It absolutely doesn't cover anything. We'd be more likely to win this friday's Lotto Max jackpot then ever claim anything under this policy. However, we have a couple of our major customers that absolutely require it. I'm kind of stuck between a rock and a hard place.

You could get additional insurance through Marsh and probably others on individual shipments. The cost is very inexpensive and will give you full coverage for the freight and the transportation costs.

 

[Activet]

Contingent Cargo Insurance

It absolutely doesn't cover anything. We'd be more likely to win this friday's Lotto Max jackpot then ever claim anything under this policy. However, we have a couple of our major customers that absolutely require it. I'm kind of stuck between a rock and a hard place.

Pablo, I feel empathy for being between a "rock and a hard place".

Every contingent cargo insurance policy I've ever read contains a covenant that precludes you from even disclosing it's existence to customers, carriers, or anyone else.

If your existing policy is similarly worded, how do you comply with your customer's requirements without breaching the terms of said policy?

 

[Pablo]

more info

It's actually not contingent cargo, but non-owned auto. It would apply coverage in a situation where a carrier got in an accident and somehow we were dragged into it.

I was able to get the "non disclosure clause" removed.