FREIGHT BROKERS

Freight brokers in the United States typically need to carry various insurance coverages to protect their business from potential risks and liabilities. Below are some of the typical insurance coverages that US freight brokers often carry:

1. Contingent Cargo Insurance: This coverage provides protection in case the carrier's cargo insurance is insufficient to cover the loss or damage to the goods being transported. It acts as a safety net for the freight broker in case the carrier's insurance falls short.
2. Errors and Omissions (E&O) Insurance: Also known as Professional Liability Insurance, E&O insurance covers the freight broker against claims of professional negligence, errors, or omissions that may lead to financial losses for their clients.
3. General Liability Insurance: General liability insurance offers protection for bodily injury, property damage, and advertising injuries that may occur on the broker's premises or as a result of their operations.
4. Contingent Auto Liability Insurance: This insurance provides coverage in case the motor carrier's auto liability insurance does not fully cover an accident caused by the carrier while hauling a brokered load.
5. Surety Bond (BMC-84 or BMC-85): A surety bond is a requirement by the Federal Motor Carrier Safety Administration (FMCSA) for freight brokers to obtain operating authority. It ensures that the broker will fulfill their financial responsibilities, including paying carriers and shippers promptly.
6. Cyber Liability Insurance: This coverage protects the freight broker against cyber-related risks, such as data breaches, hacking, and cyber extortion, which are becoming increasingly prevalent in the digital age.
7. Commercial Property Insurance: While not always required, commercial property insurance may be essential if the freight broker owns or leases office space, warehouses, or other property. It provides coverage for the physical assets in case of damage or loss due to covered perils.
8. Workers' Compensation Insurance: If the freight broker has employees, workers' compensation insurance is necessary to cover medical expenses and lost wages in the event of work-related injuries or illnesses.

It is essential for freight brokers to carefully assess their specific business needs and risks and work with a qualified insurance professional to tailor their insurance policies accordingly. Having comprehensive insurance coverage in place not only ensures compliance with industry regulations but also provides peace of mind in a highly competitive and ever-changing freight brokerage industry.