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Home » Blog


The Texas Insurance Guide

from Licona Insurance Group


Welcome to our new blog, established January 2021. We are eager to share with you the many things that we have learned over our 50 years in the insurance industry.

This blog aims to be a resource for commercial and personal insureds alike to further familiarize themselves with the insurance industry and the thing that can be done to save money now and in the future.

We will be posting new blogs regularly, so be sure to check back for more. Please select a blog entry below or scroll to peruse past entries:

How to lower commercial trucking insurance premiums:


Among the concerns of most commercial trucking companies is how they can lower their insurance premiums. In this article we’ll discuss the factors that insurance companies use to decide premiums and the steps that companies can take to be sure that they’re always getting the lowest rate possible to meet their needs.

Understanding Insurance Premiums

Premiums are based entirely on the amount of risk that the insurance company takes on when taking on a client. Risk assessments, particularly in the commercial trucking industry are increasingly holistic. That is to say, they are taking into account more and more factors every year.

Insurance firms want to know that trucking companies not only care about safety, but are actively committed to constantly improving safety and avoiding accidents and injury. It is noteworthy that not all insurers offer the same discounts. When they will, though, trucking companies may prove this commitment to safety several different ways:

Lowering your Commercial Trucking Insurance Premiums

There are several ways that you can lower the cost of your insurance premiums. Most of them involve fostering a safe work environment on and off the road. Here are some of the primary reasons that insurers may offer discounts or look more graciously at an account:

    • • Maintain low loss ratios

When shopping for insurance, you will be asked to provide your loss runs from previous years. The insurer will look at these loss runs and take many things into account that we cover here in our blog entry titled, “Understanding Your Loss History.”

The primary metric for assessing the risk of your account is your loss ratio. The loss ratio is the total premiums paid for a total year, divided by the total number of losses. The lower the loss ratio the better. Each insurer may have a different standard for the loss ratios they accept, debit, or credit. This is an important concept and the remainder of this list is primarily dedicated to achieving low loss ratios.

    • • Hire experienced drivers

The hiring of experienced drivers will benefit you in multiple ways and allow both you and the insurance company to passively keep your risk low. Experienced drivers are far less likely than inexperienced drivers to have accidents. Hiring these drivers helps to avoid having to pay deductibles and higher future premiums.

If your firm has trouble hiring or keeping experienced drivers, it will lead to increased risk which will likely lead to higher premiums. On the other hand, securing experienced drivers to haul loads can lead to less losses and future discounts through good driving.

    • • Set standards for driving records

It is no secret that insurance companies set a standard criteria that driver’s must meet in order to be included on a policy. Some trucking companies rely solely on their insurance company to tell them whether a driver is worthy or not.

The scenario just described is not ideal. Every company who employs drivers, particularly those in commercial trucking, should have their own set of standards that they diligently adhere to when deciding whether or not to hire a driver. Remember that hiring a driver is assuming a risk, the best way to reliably measure that risk is through driving records.

    • • Employ a dedicated Safety Officer

Under the umbrella of safety fall many things, be it on the road or in the warehouse. These responsibilities should not be left solely to drivers or other employees without stringent oversight.

Employing a full time safety officer can help to ease the burden of drivers, train incoming employees to lower risk, and ensure proper safety procedures are being followed through education and oversight. In addition to that, some insurance companies offer a direct discount on premiums for having a safety officer on staff. Below we cover some of the typical safety officer’s duties.

    • • Have an up to date Safety Manual

A safety manual should be created and updated regularly to reflect the changing regulatory and technological environments. This is typically the duty of the safety officer but can be delegated elsewhere if a safety officer isn’t on staff.

The safety manual should be an easy to read yet comprehensive guide to the trucking safety standards that your company demands. These standards should not be stagnant, but ever evolving. Therefore, the safety manual will also require upkeep to ensure that the information is not out of date.

    • • Require drivers to continue education

Due to the ever changing circumstances described above, drivers should be required to periodically familiarize themselves with the new safety standards. Additional third party safety certifications can also be a great supplement for driver education.

Keeping your drivers up to date on the latest safety standards lowers your financial risk and in most cases lends to low loss ratios. Education is paramount to safety, drivers cannot be expected to enforce standards they are not familiar with.

    • • Maintain a modern fleet

Old power units (trucks) can lead to increased chance of mechanical breakdown and even accidents. Removing old trucks and swapping them out for more modern equipment is crucial to keeping your premiums where they should be.

Different insurers may have different standards for the age of commercial trucks they will allow on their policies. Older trucks making up too large a share of your fleet may also lead to additional premium costs even if allowed on the policy.

    • • Monitor your Compliance, Safety, Accountability (CSA) Score

The Federal Motor Carrier Safety Administration (FMCSA) utilizes their Compliance, Safety, & Accountability (CSA) scores to identify high risk drivers. Too poor of a CSA score can result in a number of different interventions by the regulatory agency.

The safe driving practices mentioned throughout this blog can help to improve and maintain a safe environment and avoid intervention.

    • • Accept higher deductibles

While it may not be the most ideal way to lower your premiums, accepting higher deductibles can almost always lower your premiums. By following the tips in this entry, you can greatly reduce the likelihood of an accident.

If an accident is unlikely, then paying a deductible is unlikely, and accepting a higher deductible in exchange for a lower premium may actually make financial sense.

This is just a surface level view of a few of the things that you can add, change, or improve about you or your clients trucking business to help to lower the monthly rates. It should be reiterated that it lowers the monthly rate because it lowers risk for both the insured and the insurer. The insurance company uses various risk metrics to calculate the amount of premiums they must collect in order to cover a certain risk. While this premium amount can vary from one insurer to the next, the risk factors taken into account are often the same or very similar across the commercial auto insurance industries.

18 wheeler accidents can cause death, injury, loss of cargo, property damage, and a number of other things that insurers must take into account. The settlements in states such as Texas can reach into the hundreds of millions of dollars. That is a large risk for any company to take on and so it is paramount that insurers diligently vet possible insureds along with their drivers, equipment, and safety standards. In the event of an accident, the insurance company may have to prove that they covered this due diligence and did not knowingly allow dangerous drivers or equipment on the road.


Taking the steps outlined in this post can help to prove to insurers that a trucking company has the necessary standards and procedures in place to:

  • • Hire safe drivers
  • • Train drivers and employees in safe practices on and off the road
  • • Engage in ongoing training that reflects the changing regulatory and safety standards
  • • Maintain a quality fleet that will not lend itself to accidents on the road
  • • And more…


In the blog entries to follow we will talk about some of the points outlined in this post much more. We will take an in depth look into both the trucking and commercial auto industries and try to give a more deeper understanding about the relationship between the two. If you have any questions, please feel free to contact us at any time whether you are an insurance agent or end consumer; we are here to help.