The short answer
Physical damage insurance covers your own tractor and trailer: collision covers crashes, and comprehensive covers fire, theft, vandalism, weather and similar losses. It's usually written on a stated value basis and required if your truck is financed or leased.
Physical damage coverage protects your equipment, usually your largest business asset. If your truck is financed, your lender will require it. If it's paid off, it's still often the difference between a bad week and losing your business after a total loss.
Collision and comprehensive
| Coverage | What it covers |
|---|---|
| Collision | Damage from hitting another vehicle or object, or overturn |
| Comprehensive | Fire, theft, vandalism, hail, flood, falling objects, animal strikes |
How stated value works
Truck physical damage is usually written on a stated value basis. You declare the value of each unit; premium is based on it. After a total loss, you're typically paid the lesser of the stated value or the actual cash value, minus the deductible. Overstating value means paying for coverage you won't collect; understating it leaves you short.
Deductibles
Higher deductibles lower premium. Choose one you can pay immediately after a loss. Lenders often set a maximum deductible in the loan agreement.
Optional add-ons to ask about
- Towing and labor
- Rental or downtime reimbursement
- Custom equipment or permanently attached accessories
- Gap coverage if you owe more than the truck is worth
Who needs it
- Anyone with a financed or leased truck (required by lenders)
- Owner-operators who couldn't replace the truck out of pocket
- Leased-on drivers, since the carrier's policy usually doesn't cover your truck
When to reconsider it
On an older, paid-off truck worth little, compare the yearly premium to what you'd actually collect. Our guide on lowering your premium covers this trade-off.
Physical damage and trailers
Owned trailers can be scheduled on your physical damage policy. Trailers you pull under an interchange agreement need trailer interchange coverage instead.
Questions truckers ask
Is physical damage insurance required?
Not by law, but lenders and lessors require it on financed or leased trucks.
What is stated value?
The value you declare for each unit. After a total loss you're typically paid the lesser of stated value or actual cash value, minus the deductible.
Does physical damage cover theft?
Comprehensive coverage typically covers theft of the truck.
Does physical damage cover trailers I don't own?
Usually not. Trailer interchange covers non-owned trailers under an interchange agreement.
Written by the FairlyCover Editorial Team. This guide explains how coverage generally works. It isn't legal or insurance advice, and your policy wording always decides what's covered. How we write and review content.
