What insurance does a Texas hotshot operation need?

This page is for owner-operators and small fleets running a pickup (usually a one-ton dually or medium-duty truck) pulling a gooseneck, flatbed or dovetail trailer: oilfield parts and equipment, construction machinery, ag equipment, vehicles and expedited freight. In Texas, a lot of hotshot work starts in the oilfield (see oilfield trucking insurance), and a lot of hotshot carriers are new authorities. If that is you, the new authority page and what a new venture policy is are the right starting points.

Hotshot sits right on top of three regulatory lines, and which side of each line your rig falls on changes your insurance and filings.

10,001 lbs (federal CMV). Under 49 CFR 390.5, a vehicle is a commercial motor vehicle when its gross vehicle weight rating or gross combination weight rating, whichever is greater, is 10,001 lbs or more. In interstate commerce that brings federal safety rules, including driver medical certification (49 CFR 391.41). The federal financial responsibility table in 49 CFR 387.9 starts at the same line: $750,000 for for-hire interstate non-hazardous property.

Over 26,000 lbs (TxDMV). TxDMV requires intrastate registration for a commercial motor vehicle or combination with a gross weight, registered weight or gross weight rating over 26,000 lbs, and sets $500,000 as the liability minimum for those carriers. A small hotshot rig that stays at or under that line and does not haul placarded hazmat or household goods may not need a TxDMV number, but brokers and shippers set their own requirements.

26,001 lbs with a trailer over 10,000 lbs (CDL Class A). Under 49 CFR 383.91, a combination with a GCWR of 26,001 lbs or more, where the towed unit's GVWR is over 10,000 lbs, is a Group A vehicle. The test uses the manufacturer's ratings on the truck's door-jamb label and the trailer's VIN plate, not what the load weighed today. A one-ton pickup pulling a large gooseneck can easily be rated over this line.

Some operators build "non-CDL" combinations that stay under the CDL ratings. Whether a specific setup qualifies is a licensing question for DPS or FMCSA, not something an insurer can certify. What the insurer will do is check whether each driver holds the license the rig requires.

Hotshot carriers go through the same onboarding as larger fleets. Platforms such as RMIS, Highway and MyCarrierPackets check active authority, insurance filings and a certificate. Common sticking points for hotshot accounts:

• Liability limit. Many brokers want $1 million even though the federal minimum is $750,000. See why brokers require $1 million.
• Cargo limit. Equipment loads can be worth far more than the cargo limit a new hotshot carrier started with. The rate confirmation may name a higher limit for a specific load. See how much cargo brokers require.
• Authority age. Some brokers will not load very new authorities. That is a broker policy, not insurance, but insurance timing affects when your authority goes active. See how long until new authority is active.
• Trailer on the certificate. If the trailer is not on the policy, physical damage and sometimes the certificate itself will not match what shows up at pickup.

• Driver experience, including towing experience specifically. New CDL holders and drivers new to trucking are a central issue. See can new CDL drivers get insured.
• Authority age and loss history. A new authority has no loss runs, so underwriters lean on the owner's driving and business history.
• Radius and lanes. Regional oilfield work and long-distance expedited work rate differently. See what radius means.
• Commodity. Oilfield equipment, machinery and vehicles each carry different cargo exposure.
• Equipment values. Pickups and goosenecks are often insured on a stated amount basis; make sure the number reflects what it would cost to replace the unit.
• Personal use of the pickup. If the same truck is the family vehicle on weekends, tell the underwriter.

The pickup is on a personal auto policy

A personal auto policy is not built for for-hire trucking, and a personal insurer will not file a BMC-91X with FMCSA or a Form E with TxDMV. If the truck hauls freight for hire, it belongs on a commercial trucking policy.

The trailer is missing

Physical damage on the pickup does not insure the gooseneck. Schedule the trailer with its own value, and if you sometimes pull a customer's or borrowed trailer, see trailer interchange vs non-owned trailer.

Cargo too thin for the load

A single piece of oilfield or construction equipment can exceed a starter cargo limit. Check the cargo form for commodity exclusions (some exclude or limit machinery or vehicles) and confirm the limit before accepting the load. See motor truck cargo insurance.

Driver licensing mismatch

If a driver without the required CDL is driving a Class A combination, expect a coverage dispute. Many policies limit coverage to listed or approved drivers, and the MCS-90 may pay the public and then seek reimbursement from you. See what drivers trucking insurance can cover.

Leased to a carrier

If you run under another carrier's authority, its liability usually applies while you are under dispatch, and you need non-trucking or bobtail coverage for other use. See bobtail vs non-trucking liability.