A "self-insured" company

Is there a certain amount of trucks you must have before you can apply to be self insured?

 

Only if they can get away with it.....

Self insurance means you pay all claims up to your ceiling [usually 250K or so] out of pocket and the rest of the require coverage is handled by the insurance carrier providing $251.000.00 to $750K or more in coverage if required.

Matlack under Rollins ownership was self insured through Rollins Burdock Hunter and a call from my terminal location to the insurance department didn't go to Matlack"s floor in the Rollins tower but right to the insurance company.

We had a 100 million blanket of additional liability and Leased operators were charged a 'recap' fee for being under that coverage of $110.00 a month.

I had an ex-owner operator turned company driver who was being taken to court from a delivery problem when he was under lease and he was glad. Flown down to Florida with room and board all on the insurance with good representation that kept him out of any financial effects to his pocket.

Otherwise many carriers offer Non Trucking and sometimes Physical Damage coverage not always beneficial to the owner operator's settlement.

Problem is I don't really know if anyone else benefited from that $110.00 a month; I guess they were making enough to disregard the additional cost.

 

I hate to be a Debbie downer but this doesn't seem like a business plan that would pan out. For one you don't even have a CDL or any seat time so you're essentially jumping in blind. Just to run some rough numbers, 27k/year insurance with 8 down (assuming you have that to throw down immediately) gets you to 19k/a year. That's $1583/a month, now it sounds like you plan on financing a truck, assuming you're not a mechanic you're going to be looking at trucks that are pretty much ready to go and at your age if you can get that financed at all its gonna be At a higher rate so let's guess 4000/month truck payment. Now let's assume you're fling local haul and burn about $200 in fuel a day at these prices, now you work 5 days a week, that puts you at $1000 a week or $4000 a month in fuel. Next let's look at the maintenance budget, assuming you have some mechanical abilities and can do your own grease jobs (needed atleast weekly in the dump world), tire changes, PM services and minor welding repairs (frequently needed in dump world), let's put that at 1200/a month (you're gonna burn a set of tires per year in a dump). That right there is $10,783 a month in expenses. In other words, you need to set aside $2695.75 per WEEK just to break even, and this is not even beginning to include taxes, permits, registration and most importantly what you're gonna pay yourself per hour or day as a driver, after all you have to survive somehow too right? I'd work a year or two for a local dump outfit that is hopefully willing to train you and while you build seat time and contacts in the business, form an LLC and get a DOT number so that stuff is already established and you are ready to make the jump when or if the time comes. The longer you have your CDL getting paid to learn on someone else's dime, the more it will save you in learning experiences and insurance cost.
-Pat

 

What you have to do is post a bond. You can't just promise to pay. A bonding company is one that holds a pile of money that guarantees the courts that any judgement against you will be paid. The difference between that and an insurance policy is if a bonding company pays a judgement on your behalf then it becomes a debt you own them. No bonding company is going to issue such a bond unless they believe you can and will pay up. So for a small trucking company you would then have to take out an insurance policy along with the bond. But that would be paying two premiums to accomplish what a simple insurance policy alone would have accomplished. Only companies that are able to convince a bonding company (all of which are also insurance companies) that they can pay a judgement will be able to get away with just a bond. Bonds are a lot cheaper than insurance so the big megas usually go that route.

Have you ever known anyone who was required by a court to take out an SR-22 in order to keep driving? That's a bond. And of course, your agent won't sell you an SR-22 unless you also buy liability insurance from him. See how it works?

 

in addition to what Antinomian said, the one thing that many self-insured companes do is delay or ignore claims made against their trucks. This has led to litigation for non-payment of claims or obfiscation of responibilities resulting in increases in settlements beyond the insured amount. Many cases about no settling claims in timely matters seems to have the dollar amount growing exponentially with each case. There is talk about having self-insured companies in this state possibly having to go to an outside administrator where the adjudication of the claim internally is faster and with no intentional delays.