Who needs it
Freight brokers registered with FMCSA to arrange transportation of property. E&O and contingent cargo are optional but often requested by shippers.
What it pays for
- Bond: payments to shippers and motor carriers if you fail to pay under your contracts
- E&O: claims that a mistake in your brokerage work cost a customer money
- Contingent cargo: freight loss when the motor carrier's cargo insurance doesn't pay
- Contingent auto liability: claims against you after a crash by a motor carrier you hired, on some policies
What it won't pay for
- The bond doesn't protect you: you repay the bond company for any claim it pays
- Contingent cargo usually won't pay if the motor carrier's cargo policy should have paid
- Fraud and theft by your own staff, usually (that needs crime coverage)
- Fines and penalties
What moves the price
We don't show prices online. These are the things an agent and the insurance companies look at.
- Your personal and business credit (for the bond)
- Years in business and broker experience
- Revenue and number of loads
- Types of freight you arrange
- Your claims history
Real situations
- A motor carrier hauls a load for you and you don't pay it. The motor carrier files a claim on your BMC-84 bond, the bond company pays, and then bills you back.
- A load is stolen and the motor carrier's cargo insurance denies the claim. Your contingent cargo coverage pays the shipper, up to its limit.