Trucking Regulations - Part I - Financial Responsibility
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We want to take the opportunity, as we discussed in our previous post, to educate the public about some of the regulations governing the trucking industry. These regulations are promulgated by the Federal Motor Carrier Safety Administration under the Federal Motor Carrier Safety Act (FMCSA). Today's regulation is 49 C.F.R. § 387 - "Minimum Levels of Financial Responsibility".
The FMCSA requires interstate trucking companies to carrier minimum levels of insurance coverage. The minimum levels of insurance required on a truck depend upon what type of cargo the truck is transporting. Under the FMCSA, interstate trucking companies are required to carry the following coverages:
Nonhazardous Property - $750,000.00
Petroleum or oil - $1,000,000.00
Hazardous Substances - $5,000,000.00
The FMCSA also provides minimum levels of coverage for interstate carriers of passengers:
Seating capacity of 16 or more - $5,000,000.00
Seating capacity of 15 or less - $1,500,000.00
The penalty for failing to carry the appropriate coverages is $11,000.00. What's the purpose of this regulation? It is stated in the regulations:
The purpose of these regulations is to create additional incentives to
motor carriers to maintain and operate their vehicles in a safe manner
and to assure that motor carriers maintain an appropriate level of
financial responsibility for motor vehicles operated on public highways.
Next, we will discuss the qualifications of drivers and what is required under the FMCSA.