Hazardous Materials Transportation Insurance Terminal Coverage

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Hazmat Transportation Insurance Requirements FMCSA Part 387 Minimum levels

Question 1: Is gasoline listed as a hazardous material, and, if so, what is the minimum level of financial responsibility currently required?

Guidance: Gasoline is a listed hazardous material in the table found at 49 CFR 172.101. §387.9 requires for-hire and private motor carriers transporting any quantity of oil in interstate or foreign commerce to have a minimum $1,000,000 of financial responsibility coverage. The Clean Water Act of 1973, as amended, declares that gasoline is an "oil," not a "hazardous substance." The $1,000,000 coverage also applies to for-hire and private mo tor carriers transporting gasoline "in-bulk" in intrastate commerce.

Question 2: Is a motor carrier transporting liquefied petroleum gas (LPG) in any quantity required to have $1,000,000 or $5,000,000 of financial responsibility coverage?

Guidance: Liquefied petroleum gas (LPG) is a flammable compressed gas. All transportation of LPG in containment systems with capacities in excess of 3,500 water gallons requires $5 million financial responsibility coverage. Interstate and foreign commerce movements of LPG in containment systems not in excess of 3,500 water gallons requires $1 million coverage. Intrastate movements of LPG in those smaller containment systems are subject only to state financial responsibility requirements.

Question 3: What is the definition of a "hopper type" vehicle as indicated in §387.9?

Guidance: A "hopper type" vehicle is one which is capable of discharging its load through a bottom opening without tilting. This vehicle type would also include belly dump trailers. Rear dump trailers and roll-off containers do not meet the definition of a bottom discharging vehicle

Question 4: What level of insurance is required for a carrier operating a multi-compartment cargo tank that is transporting a hazardous substance, where each compartment is less than 3,500 water gallon capacity, and the total capacity is greater than 3,500 water gallons capacity?

Guidance: $5,000,000 of insurance is required. The table in §387.9 requires that amount of coverage for hazardous substances transported in “cargo tanks, portable tanks, or hopper-type vehicles with capacities in excess of 3,500 water gallons.” The transporting vehicle must have “a gross vehicle weight rating of 10,000 or more pounds.” Section 171.8 of title 49, C.F.R., defines a “cargo tank motor vehicle” as a motor vehicle with one or more cargo tanks permanently attached to or forming an integral part of the motor vehicle. Additionally, the use of the plural to describe the tanks and the singular to describe the truck implies that the standard is met if several tanks with a combined capacity of 3,500 water gallons are transported on the same vehicle. This is consistent with the purpose of the financial responsibility requirement — in this case, to protect the public from financial loss following an accidental release of hazardous material—because all of the compartments in a single tank trailer could be damaged in one crash. Here, the compartments on the vehicle have a total capacity of greater than 3,500 water gallons, therefore $5,000,000 of insurance is required.

Question 5: What level of insurance is required for a motor carrier operating a tube trailer where the cylinders are manifolded together. Each separate cylinder has a capacity less than 3,500 water gallons, but the total capacity of all the cylinders on the vehicle is in excess of 3,500 water gallons.

Guidance: $5,000,000 of insurance is required, for the reasons given above. The table in §387.9 refers to “in bulk Division 2.1 or 2.2 materials.” The definition of in bulk in §387.5 includes “the transportation, as cargo, of property … in containment systems with capacities in excess of 3,500 water gallons.” In this case, a group of cylinders manifolded together qualify as “containment systems.” As in Guidance A, the table describes the vehicle in the singular. As long as the containment systems transported on a single vehicle have a total capacity of at least 3,500 water gallons, $5,000,000 of insurance is required.

Place Card Colors

Red placards indicate the material is flammable;
Green placards indicate the material is non-flammable;
Yellow placards indicate the material is an oxidizer;
Blue placards indicate the material is dangerous when wet;
White placards indicate the material is an inhalation hazard and/or poison;
Black and white placards indicate the material is corrosive;
Red and white placards indicate the material is a flammable solid or spontaneously combustible (it depends on the color pattern);
White and yellow placards indicate the material is radioactive;
Orange placards indicate the material is explosive;
White placards with black stripes indicate miscellaneous hazardous materials.

View DOT CHAT 15 - Hazardous Marterials Markings, Labeling and Place Card Guide

Hazardous Materials Transportation Insurance Terminal Coverage

Class 1 – Explosives
Class 2 – Gases
Class 3 – Flammable Liquid
Class 4 – Flammable Solid
Class 5 – Oxidizing Substances ; Organic Peroxides
Class 6 – Poisonous (Toxic) and Infectious Substances
Class 7 – Radioactive Material
Class 8 – Corrosives
Class 9 – Miscellaneous Dangerous Goods

Hazmat for Truckers Insurance Quotes

Cargo Insurance for Hazmat Haulers

A.1., paragraph a. of the CA9948 endorsement, the endorsement says that the coverage provided by CA9948 applies except for liability assumed under a contact or agreement. In other words, if the crash had a pollution spill caused by the insured’s negligence, the CA9948 endorsement would provide coverage. But if the pollution event was caused by the shipper loading the load and the load escaped because of the negligence of the shipper loading the load, there would not be coverage for the shipper even if the insured held the shipper harmless (in an insured contract). The endorsement provides coverage to the insured but not to any other negligent party even if the insured agreed to under a written agreement to hold them harmless.

To address the possible need of the Transportation Pollution stand-alone policy would be if the insured held someone harmless for their negligence, the CA9948 would not consider the agreement an insured contract but the stand alone policy might. I say might because not all Transportation Pollution stand-alone policies are uniform.

One other consideration, even if the individual who is a motor carrier holds a customer (shipper) harmless if the contract is subject to state laws where the law has an anti-indemnification provision (42 states have such laws – all but Mississippi, Ohio, Delaware, New York, New Jersey, Rhode Island, Vermont and New Hampshire) the contract cannot be enforceable because of state laws.

Other possible needs for a stand-alone Transportation Pollution policy (remember policy wording could be different) if the insured has other responsibilities beyond transportation like loading and unloading with a mechanical device not attached to the covered auto, flatbed operation hauling 55 gallon drums of oil, motor carrier is required to unload the drums and uses a forklift and while unloading the forklift turns over and drum hits the ground and opens and oil escapes. An AL policy with CA9948 would not address because of Exclusions 7 and 8 – GL would not address because insured brought the oil to the accident location, so stand-alone policy could address loss. If insured has any responsibility beyond hauling the load, has any contractual responsibility and is under a state law without anti-indemnification provision then the stand-alone policy would be needed.

Lastly, of course if the AL carrier would not provide the CA9948 endorsement, the stand-alone policy would be needed.

Is it worth looking into a stand-alone pollution policy? Probably – Would it provide protection that CA9948 does not – Maybe, but depending on the wording of the stand-alone policy, the availability and or cost of the CA9948 endorsement or if the insured does more than provide transportation.

By: Tommy Ruke

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