Federal Minimum Insurance for Motor Carriers: The $750,000 Floor
A general freight carrier's federal insurance floor is $750,000 per accident, the same figure that took effect on January 1, 1985. What the floor covers, what guarantees it, and why raising it has stalled.
The federal insurance floor for a for-hire truck hauling ordinary freight across state lines is $750,000 per accident. The figure sits in 49 CFR 387.9 under a column headed “January 1, 1985”1, and it has not moved since. Many carriers buy more. But it is all federal law requires to stand behind such a truck in a crash, and above the 10,001-pound line it turns on what the truck carries, not on how heavy it is or how much harm a crash can do.
The schedule
Section 387.9 sets four public liability tiers for vehicles carrying property1:
| Who | Cargo | Minimum per accident |
|---|---|---|
| For-hire carriers, interstate or foreign commerce, vehicles of 10,001 lb GVWR or more | Nonhazardous property | $750,000 |
| For-hire and private carriers, 10,001 lb or more; any quantity interstate, bulk only intrastate | Oil, and hazardous waste, materials and substances not in the $5 million tiers | $1,000,000 |
| For-hire and private carriers, 10,001 lb or more, interstate, foreign or intrastate | Hazardous substances in bulk tanks or hoppers; bulk explosives, gases and poison-inhalation materials; highway-route-controlled radioactive shipments | $5,000,000 |
| For-hire and private carriers, under 10,001 lb, interstate or foreign | Bulk explosives and poison-inhalation materials; highway-route-controlled radioactive shipments | $5,000,000 |
The schedule reaches for-hire property carriers in interstate or foreign commerce, and any carrier hauling hazardous materials, including bulk loads inside one state. Vehicles under 10,001 pounds fall outside it unless they carry the most dangerous cargo2. A separate filing rule sets $300,000 for for-hire fleets made up only of vehicles under 10,001 pounds carrying nonhazardous property3.
A carrier proves coverage with an MCS-90 insurance endorsement, an MCS-82 surety bond or FMCSA authorization to self-insure, kept at its principal place of business. The proof is public information and must be produced on reasonable request by a member of the public4. FMCSA points readers to its licensing and insurance system for a carrier’s insurance status18.
Passenger carriers
Section 387.33T, the version of 387.33 in force, sets the passenger schedule. For-hire carriers of passengers in interstate or foreign commerce need $5,000,000 for a vehicle seating 16 or more, counting the driver, and $1,500,000 for 15 or fewer5. The rule excludes vehicles carrying only school children and teachers to or from school, small taxicabs, commuter vehicles carrying fewer than 16 people and contracted school extracurricular trips6. The passenger endorsement is Form MCS-90B.
What the MCS-90 does
The MCS-90 is attached to the carrier’s liability policy and applies to every vehicle operated under it, not to a list of trucks8.
Its central promise runs to the public. The insurer agrees to pay, up to the endorsement’s limits, any final judgment against the insured carrier for public liability resulting from negligence in the operation, maintenance or use of vehicles subject to the federal requirements. That holds whether or not the vehicle is described in the policy and wherever the crash happens. No condition, limitation or breach of the policy relieves the insurer of that payment, and neither does the carrier’s insolvency or bankruptcy7.
The cost is meant to land on the carrier. The form keeps the policy’s terms binding between insurer and carrier, and the carrier agrees to reimburse the insurer for any payment it would not have owed except for the endorsement7. The injured party collects; the insurer then has a claim against its own customer.
The guarantee is narrow. It excludes injuries to the carrier’s own employees on the job, and cargo. Its limits apply separately to each accident7, so everyone hurt in one crash draws on the same amount. In 2005, after denying a petition from insurers to amend the form, FMCSA issued guidance that the endorsement does not require an insurer to pay a judgment against anyone other than the carrier named in it9.
Unchanged since 1985
Congress set the amounts in the Motor Carrier Act of 1980, and the statute still says the property level “shall be at least $750,000”10. The Department of Transportation phased the levels in at lower amounts, then on January 1, 1985 set them at the lowest levels the act allowed. In FMCSA’s words in 2014, “the levels have remained unchanged since”11. FMCSA can raise the minimums by regulation. It has not.
The last rulemaking attempt ran from 2014 to 2017. FMCSA’s November 2014 advance notice cited its own report to Congress, which concluded the minimums were inadequate to cover the costs of some crashes. It summarized a study by DOT’s Volpe Center: crashes with claims above the minimums were estimated at under 1 percent of commercial vehicle crashes, crashes in the most severe injury categories could exceed $1 million, and medical prices rose 4.9 percent a year from 1985 to 2013, against 2.8 percent for the consumer price index excluding food and energy11.
The notice set out evidence pointing both ways. The Pacific Institute for Research and Evaluation and the Trucking Alliance, a group of trucking companies, each concluded the floor was too low. The American Trucking Associations’ review of data from two large trucking insurers found that most policies on trucks over 26,000 pounds were already written at $1 million or more, and put the chance of a claim above $1 million at 0.73 percent11. The notice’s questions also covered the concerns on the other side: whether a higher floor would affect small and large carriers differently, and whether carriers could still obtain insurance.
FMCSA withdrew the notice in June 2017. It had received 2,181 comments but said they lacked the cost and benefit data a rule would need. The agency said it could not estimate how much premiums would rise, how insurers’ capital requirements would change, or what crash victims would gain12.
Congress has considered changing the statute directly. Section 4408 of H.R. 2, an infrastructure bill in the 116th Congress, would have raised the $750,000 figure to $2,000,000 and required inflation adjustments every five years. The House passed the bill on July 1, 2020, by 233 to 188. Its last recorded action is receipt in the Senate on July 20, 202013.
Brokers and freight forwarders: $75,000, for a different purpose
A freight broker must keep a $75,000 surety bond or trust fund to hold FMCSA registration14. The statute fixes the amount regardless of how many offices or agents the broker has, and sets the same $75,000 for freight forwarders1516.
The bond is not crash coverage. It pays shippers or motor carriers when a broker fails to carry out its transportation contracts, such as by not paying freight charges1415. A 2023 rule, with provisions in force since January 16, 2026, lets FMCSA suspend a broker’s authority when the bond or trust drops below $75,000 and is not restored1714. Neither bond is designed to pay people hurt in a crash.
Why serious crashes outrun the floor
The minimum is one per-accident amount shared by everyone hurt in a crash, and a crash with several seriously injured people can produce claims far beyond it. The floor has stayed fixed while medical costs climbed, and FMCSA’s 2014 notice said coverage at the statutory minimum does not cover as much of a catastrophic crash as it once did11.
Carriers that buy higher limits or excess and umbrella policies raise what is available. Where a carrier holds only the minimum, claimants look to the carrier’s own assets and to other parties who may share responsibility, such as a shipper, broker, maintenance contractor or vehicle manufacturer. Whether any of them is liable depends on the facts and on state law; see liability in commercial vehicle collisions. For where Part 387 sits among the other safety rules, see the reader’s map to the FMCSRs.
