What Physical Damage Insurance Actually Covers
Physical damage insurance has two components. Most policies include both, but they cover different things.
Collision
Covers damage to your truck from hitting something — or something hitting you.
Covered
- Hitting another vehicle
- Hitting a guardrail, post, or building
- Rolling over
- Being hit by another vehicle
- Jackknife damage
- Hitting a pothole (in some policies)
Key Detail
Collision pays regardless of fault. Whether you caused the accident or someone else did, your truck gets fixed. If the other driver was at fault, your carrier may subrogate (recover from their insurer).
Comprehensive
Covers everything else — damage that isn't from a collision.
Covered
- Theft (entire truck or components)
- Fire
- Vandalism
- Hail, windstorm, flood
- Falling objects (tree limbs, debris)
- Animal strikes (deer, etc.)
- Glass breakage (windshield)
- Riot or civil commotion
Key Detail
Comprehensive is generally cheaper than collision because these events are less frequent. Some truckers carry comp-only (no collision) on paid-off trucks to save money while still covering theft and weather.
What Physical Damage Does NOT Cover
Mechanical breakdown
Engine failure, transmission problems, electrical issues. That's maintenance, not insurance. Your turbo blew? Not covered.
Normal wear and tear
Rust, faded paint, worn tires, deteriorating seals. Insurance covers sudden damage, not gradual aging.
Cargo damage
Your freight is covered by cargo insurance, not physical damage. Cargo insurance is a separate policy.
Injuries to people
That's auto liability (bodily injury). Physical damage only covers your truck, not people.
Aftermarket modifications (unless declared)
Custom exhaust, light bars, chrome, upgraded sleeper — unless you specifically listed and valued these on your policy, they're not covered.
Intentional damage
Obviously. You can't total your own truck and collect insurance.
ACV vs Stated Value vs Agreed Value
How your truck is valued on the policy determines how much you get paid when it's totaled. This is the single most important detail in your physical damage coverage.
Actual Cash Value (ACV)
Most CommonWhat it means: The carrier pays what your truck is worth at the time of loss — not what you paid for it, not what you owe on it.
Stated Value
What it means: You declare a value when you buy the policy. But "stated" doesn't mean "guaranteed" — the carrier can still pay ACV if it's lower than your stated amount.
Read the fine print. "Stated value" sounds like it guarantees a payout amount, but it usually doesn't. It mainly sets the maximum.
Agreed Value
Best ProtectionWhat it means: You and the carrier agree on a value upfront. If the truck is totaled, that's what they pay — period. No depreciation argument, no market value debate.
Agreed value costs more (typically 10-20% higher premium) and may require an appraisal. But for expensive trucks, the certainty is worth it.
Choosing Your Deductible
Best for: newer trucks with higher value, operators who can't absorb a large unexpected expense. Premium is typically $300-$500 more annually than a $2,500 deductible.
Best for: most owner-operators. Balances affordable premium with manageable out-of-pocket. Sweet spot for trucks valued $40K-$100K.
Best for: experienced operators with cash reserves, older trucks with lower values, or those who want to self-insure minor damage. Saves $500-$800/yr vs $1,000 deductible.
What Physical Damage Costs
| Truck Value | Annual Premium Range | Monthly |
|---|---|---|
| $30,000-$50,000 | $1,200-$2,500 | $100-$210 |
| $50,000-$80,000 | $2,000-$4,000 | $167-$333 |
| $80,000-$120,000 | $3,000-$5,500 | $250-$458 |
| $120,000-$180,000 | $4,500-$8,000 | $375-$667 |
Rates vary by driver experience, authority age, driving record, deductible, garaging location, and carrier. These ranges represent typical market pricing for owner-operators with 2+ years of clean history.
What Drives the Rate
Gap Coverage: Don't Skip This
The Scenario
Without gap coverage, you're writing a check for $19,500 on a truck you can't drive. Plus you still need to buy another truck.
Gap Coverage Fills This Hole
- Pays the difference between ACV payout and your loan balance
- Typically costs $100-$300/year — trivial compared to the protection
- Most important in the first 3 years of a truck loan when depreciation is fastest
- Some lenders require it; all should
- Also called "loan/lease gap coverage"
Do You Actually Need Physical Damage?
You need it if:
- You have a loan or lease (your lender requires it)
- Your truck is worth more than you could replace out of pocket
- Losing the truck would shut down your business
- Your truck is worth $30K+ and you don't have $30K in savings
You might skip it if:
- You own the truck outright
- The truck is worth under $15K
- You have enough cash to replace it
- You carry comp-only (covers theft/fire but not collision)
Filing a Physical Damage Claim
Photos of all damage (multiple angles), police report if applicable, witness info, your dashcam footage. Do this at the scene before anything moves.
Call your agent the same day. Delayed reporting can complicate or deny your claim. Most policies require "prompt notice."
Towing costs are usually covered (check your policy). Don't leave it on the roadside racking up impound fees — those may or may not be covered.
The adjuster will arrange an inspection. You can get your own estimate too. If repair cost exceeds 75% of truck value, it's likely a total loss.
For repairs: carrier pays repair cost minus deductible. For total loss: carrier pays ACV (or agreed value) minus deductible. If you disagree with the valuation, you can invoke the appraisal clause in your policy.
Frequently Asked Questions
Does physical damage cover my trailer?
Only if the trailer is specifically listed on the policy. Most owner-operators with their own trailer need to add it separately. Trailers you pull but don't own (broker trailers, shipper trailers) are typically covered under the trailer owner's policy, not yours.
What if the other driver was at fault?
Your physical damage still pays to fix your truck (minus deductible). Your carrier then subrogates — they go after the at-fault driver's insurance to recover what they paid plus your deductible. If successful, you get your deductible back. This can take months.
Is rental reimbursement included?
Not automatically. Rental reimbursement (also called "downtime coverage") is usually an add-on that pays $100-$300/day while your truck is being repaired. Given that downtime costs $500-$1,000+/day in lost revenue, this endorsement is highly recommended.
Will filing a claim raise my rates?
Probably. One at-fault claim can increase your rate 15-30% at renewal. A not-at-fault claim has less impact but still shows up on your loss history. That said, the purpose of insurance is to use it when you need it — don't skip a $30K claim to save $3K in premium increases.
Can I insure aftermarket parts and equipment?
Yes, but you must declare them. Chrome packages, custom exhausts, APUs, upgraded sleeper interiors — list them with values when you buy the policy. Undeclared equipment isn't covered. Some carriers offer a blanket coverage amount for aftermarket additions.
Protect Your Investment
Get physical damage coverage that actually matches what your truck is worth. We'll explain the options and help you choose the right valuation method and deductible for your situation.