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If you’re in the business of transporting temperature-sensitive perishable cargo, reefer breakdown coverage should be an indispensable part of your insurance policy. This is the smart choice that could save you thousands – if not millions – of dollars in damages.
In this article, we will answer all of these questions.
- What exactly is meant by reefer breakdown coverage?
- What are the instances included in its coverage?
- How will it benefit operators and the public as a whole?
What is Reefer Breakdown Coverage?
To put it simply: reefer breakdown coverage refers to a type of truck insurance coverage that protects reefer truck operators from financial loss in case the refrigerated cargo suffers from loss or damage because of a mechanical breakdown.
Because of the high risk of spoilage that comes with the business of operating refrigerated trucks or reefers, this coverage will reduce the impact of loss in case the truck experiences mechanical trouble. But, this assumes that you complied with all the safety standards set by law.
With that said, reefer breakdown coverage includes:
- protection against temperature fluctuations
- lost stocks
- similar damage due to the reefer’s mechanical failure
The coverage lasts as long as the refrigerated cargo is on your premises and while it is in transit. However, you must note that not all insurance companies are willing to include all aspects of refrigerated truck coverage in their policies.
Since the transport of these goods is both time and temperature-sensitive, insurance providers are well aware of the risks involved in the business. Thus, they may not always be on board with the idea of providing you with complete reefer breakdown coverage.
As a result, we strongly advise taking a closer look at your insurance policy before signing it. Make sure that it includes all the goods you are to transport, especially if you’re in the business of transporting meat and other food products.
Advantages of Having Reefer Breakdown Coverage
If you’re still uncertain if you need reefer breakdown coverage in your insurance policy, maybe these pointers will help you make a final decision.
1. Business Protection
There’s no doubt that operating reefer trucks come with risks. While goods transported are essential to human consumption, moving them from one state to another without affecting their quality is a lot of work. And all of that hard work can go down the drain simply because of a mechanical error that was beyond your control.
With the right reefer breakdown coverage, you get full protection in case of such an occurrence while the refrigerated cargo is in your custody. Obtaining one is, undoubtedly, a smart move.
2. Shared Risks
Another advantage of obtaining a refrigerated truck breakdown coverage lies in how the insurance industry works: shared risks. The premiums you pay for your policy goes to a pool shared by a group of policyholders. As a result, you don’t feel the full burden of the risk because it is shared between those who are similarly insured.
3. Economic Protection
As a result of the shared risks, obtaining this coverage will also provide you with economic protection. If your fleet of refrigerated trucks does not have coverage, the full financial burden of the loss will be shouldered by yourself. But if you wisely opt for a reefer breakdown coverage, you will be saved from completely going bankrupt. And this also guarantees business continuity.
4. Peace of Mind
And finally, reefer breakdown coverage will always give you a sense of relief. Despite the risks involved in the trucking business, you’re assured that there will not be any adverse effects that could gravely impact your business.
You will be confident that the insurance policy will have your back in case anything goes wrong. Of course, this is assuming that you’re compliant with all the regulations set for the reefer industry.
Bear in mind that insurance policies with the cheapest premiums may not always provide you with the best reefer breakdown coverage. What you pay for largely depends on the kind of goods you’re transporting, the trucks you’re using, the drivers’ skills, and other potential risks.
As a result, premiums should vary from one policyholder to another. If the price seems too good to be true, take a closer look at the policy because it might exclude some items that you need to be included in your coverage.
This is why it’s important to pair up with the right partner to help you find the perfect coverage for your business.
At ACE Commercial Truck Insurance, We Can Help You Find the Right Coverage Based On Your Commercial Trucking Insurance Needs.
We understand how complicated it is to find the perfect insurance provider, especially in the commercial trucking industry. Hidden pitfalls and tricky exclusions can become your downfall if you’re not careful.
You should also bear in mind that your commercial trucking insurance needs will change as your business grows. It’s not just a one-time deal. With years of experience in the industry, we are confident that we can help you find full protection through every stage of its growth.