The Insurance Line Nobody Reads Until the Freight Is Gone

A broker I know — I'll call him David — put a load of industrial HVAC components on a carrier he'd screened correctly. MC-1472819 / DOT-3489201. Twenty-two months of authority. Clean BASIC scores. Zero OOS violations on 18 Level 1 and Level 2 inspections. Primary liability at $1M. Carrier agreement signed. He'd used them twice before, both dry van pulls, no issues.

The carrier was involved in a collision on I-65 outside Louisville. The trailer tipped, the freight was destroyed. Street value of the load: $218,000.

David found out his carrier carried $25,000 in cargo insurance. He found out from the shipper's attorney.

The $1M he'd verified? That's bodily injury and property damage to third parties. It doesn't touch the freight.

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This distinction matters more than almost anything else in carrier vetting, and it's one that a surprising number of brokers — including experienced ones — get backwards. When something goes wrong with a load, the policy that pays for the shipper's goods is NOT the one with the large number everyone focuses on. It's a separate line on the ACORD 25, and there is no federal regulation that tells you how large that number has to be for a standard dry van carrier.

What Primary Liability Actually Covers

Under 49 CFR § 387.9, the minimum public liability insurance requirements for motor carriers carrying general freight are $750,000 for vehicles weighing less than 10,001 pounds, and the same $750K floor for most standard dry van operations. Most carriers carry $1M as a practical matter because shippers and brokers require it in their agreements.

That policy — the one that files as a BMC-91 or BMC-91X with FMCSA — covers bodily injury, property damage to third parties, and environmental restoration. Think of it as what pays out when the carrier's truck hits another vehicle. The other driver's medical bills. Damage to the guardrail. Environmental cleanup if the carrier was hauling something that leaked. Third-party losses.

The driver's own cargo? The shipper's goods sitting in that trailer? Not covered. Primary liability has nothing to do with freight claims. Zero.

There Is No Federal Minimum for Cargo Insurance on General Freight

This is the part that surprises people.

FMCSA does require specific cargo insurance for household goods carriers — 49 CFR § 387.301 sets those minimums in detail. For general freight motor carriers, there is no corresponding federal regulation requiring a minimum cargo liability amount.

Read that again: a carrier can be 100% compliant with every FMCSA insurance regulation and carry $10,000 in cargo coverage — or none at all.

The $100,000 cargo coverage figure that most brokers treat as the minimum isn't a regulatory floor. It's an industry convention. Some carriers carry more; some shippers and brokers negotiate specific requirements into their agreements; many carriers carry whatever default limit their insurer offered them when they pulled authority and never revisited it. That default is sometimes $100K. Sometimes it's $50K. I've seen $25K more times than I'd like to.

A carrier with 19 months of authority and clean BASIC scores might be running a $218,000 load with $25K in cargo coverage because nobody ever required them to carry more. And if their broker agreement only says "adequate cargo insurance" without specifying an amount, that requirement is practically unenforceable in a claim dispute.

Reading the ACORD 25 for Both Numbers

The Certificate of Insurance — the ACORD 25 form most carriers provide — does show both policies. The problem is that brokers typically glance at the "Commercial Auto" column, see a million-dollar limit, and move on.

The cargo coverage lives in a different section, usually labeled "Inland Marine" or sometimes "Motor Truck Cargo" (MTC). The ACORD 25 has multiple rows, one per policy type. Cargo and primary liability are separate rows because they're separate policies with different underwriters, different limits, and different coverage terms.

Specifically, look for:

• The policy type descriptor in the left column — "Inland Marine" or "Motor Truck Cargo" tells you you're looking at cargo coverage
• The "Each Occurrence" limit — this is the per-load or per-accident cap
• The "Aggregate" limit — some cargo policies have annual aggregate limits that, by mid-year, could already be substantially drawn down by prior claims

A carrier showing $1M per occurrence in commercial auto and $100K in cargo coverage has exactly $100K available to cover your freight in a loss scenario. If your load is worth $175K, you've got a $75K gap before your contingent cargo policy even enters the conversation. And your contingent cargo policy has its own requirements — typically that the carrier's own policy was valid and applicable, that the carrier wasn't in breach of the carrier agreement, and that you maintained the carrier file properly. A gap in the carrier's cargo coverage doesn't automatically mean your contingent policy fills it.

The Mismatch Scenario Brokers Keep Walking Into

Here's how this plays out in practice. A broker tenders a load worth $185,000. The carrier's cargo limit is $100,000. The load is damaged. The carrier's insurer pays $100,000. The shipper files against the broker for the remaining $85,000 under a negligent-selection theory — arguing the broker should have verified the cargo limit was sufficient for the load value before tendering it.

Post-Montgomery v. Caribe Transport II, LLC — the unanimous Supreme Court decision from May 2026 holding that the FAAAA doesn't preempt state-law negligent-selection claims against brokers — that theory has real teeth. A plaintiff's lawyer doesn't need to argue the broker should have caught a safety defect. They can argue the broker should have matched the cargo insurance limit to the load value. That's a straightforward negligence framing. Did the broker exercise reasonable care? Did reasonable care include checking whether the cargo limit covered the load?

It does now, if it didn't before.

What the Network Sees

One of the things that changes the picture somewhat is that DOTScreener's network shares verified cargo insurance data across organizations. When another shipper or broker has verified a carrier's cargo limit from an actual COI — not just the FMCSA filing, which doesn't include cargo limits — that verified number becomes visible to other users screening the same carrier.

This matters because FMCSA's L&I database doesn't capture cargo insurance. The federal insurance filings (BMC-91, BMC-91X) are primary liability filings. Cargo coverage isn't filed with FMCSA at all — it's a contractual arrangement between the carrier and their insurer, and between the broker and the carrier. You can't pull a carrier's cargo limit from SAFER. You have to get the ACORD 25 or a declarations page and read it yourself.

When someone else has already done that, and their verified cargo limit is on file for that carrier, that's useful information. It tells you the carrier had at least X in cargo coverage as of the date it was verified — and if that verification is recent, it's a reasonable starting point. It doesn't replace pulling your own COI, because coverage amounts can change. But it's a cross-reference signal that the carrier's file is at least consistent with what they claim to carry.

If the network shows $100K verified cargo and the carrier is handing you a COI that shows $250K, that discrepancy is worth a phone call.

The Specific Calculation Before Every High-Value Load

For loads above a threshold I'll call "significant" — and for me that threshold is anything over $75K — I run a specific comparison before I confirm:

Load value versus cargo limit. The carrier's cargo limit needs to meet or exceed the load value. If it doesn't, either the carrier needs to add a rider, or the shipper needs to carry shipper's interest coverage, or I need a different carrier. The gap isn't insurable at the broker's level without a properly structured contingent cargo policy — and most contingent cargo policies require the primary carrier's coverage to apply first.

Policy type and exclusions. "Motor Truck Cargo" and "Inland Marine" policies both cover cargo, but they have different exclusion schedules. Refrigeration breakdown exclusions. Unattended vehicle clauses. High-value goods exclusions for electronics, jewelry, and pharmaceuticals. I ask for the declarations page, not just the certificate, on any load over $150K. The certificate shows the limit. The declarations page shows what's actually covered.

Aggregate versus per-occurrence. A carrier with $1M aggregate cargo coverage but $100K per-occurrence limit has effectively the same per-load exposure as a carrier with $100K total cargo coverage, for any individual load.

How I Document This

For every load where cargo value is a material consideration — anything over $75K — my carrier file includes:

1. The ACORD 25 with the cargo coverage row highlighted and the effective/expiration dates confirmed

2. A note with the specific load value and the cargo limit side by side, confirming coverage is sufficient for this load

3. If I pulled a declarations page (loads over $150K), a copy of that in the file with the relevant exclusions flagged

4. A timestamp on when the verification was run — both for my own records and because a court or insurer may ask whether the coverage was confirmed before dispatch, not after the claim

Under 49 CFR § 371.3, brokers are required to keep records of each transaction for three years. That reg says nothing about what specifically goes into those records. But negligent-selection litigation effectively writes the real standard — the carrier file produced in discovery is the evidence of whether you did your job. A file that shows primary liability checked, cargo limit skipped, load value undocumented tells a different story than a file that shows all three confirmed.

One more thing: cargo limits renew annually. A certificate that was good in January may reflect a policy that renewed in March at a lower limit. The expiration date on the cargo section of the ACORD 25 is worth your attention every time you use a carrier on a load above your threshold — not once a year when you refresh the file. DOTScreener flags when a verified insurance record is approaching expiration; that trigger on cargo coverage is worth acting on the same way you'd act on a primary liability lapse.

The number your shipper cares about when their freight is gone isn't the one you've been watching.

Here's the specific note I put in every carrier file on loads where cargo value matters:

If coverage isn't adequate, the file notes what alternative arrangement was made — shipper's interest rider, different carrier, or written shipper acknowledgment of the gap.

That note takes ninety seconds. It's the difference between a file that defends you and a file that doesn't.

— Mason Lavallet

Founder, DOTScreener.com