Information on DOT Passenger Carrier Insurance Requirements

The Department of Transportation (DOT) allows states to set their own standards for passenger carrier insurance requirements. However, all states do have minimum requirements for buses, taxis and other public transportation vehicles that require passenger carrier insurance coverage. In most state, the Department of Motor Vehicles (DMV) is responsible for oversight and regulation of these types of vehicles.

 Insurance Requirements

All states that issue licenses and permits for passenger carrier vehicles will require a minimum amount of insurance coverage be maintained on the vehicle. The amount of insurance required varies from state to state and is usually based on the size of the vehicle and the number of passengers that the vehicle can transport. While the amount of required coverage will vary, all states have minimum requirements that are designed to help injured parties recover reasonable costs for damage and injuries if involved in an accident while traveling in a passenger carrier vehicle.

Minimum Coverage Amount Requirements

Although minimum liability amounts for passenger carrier coverage vary, all states generally require that the same type of minimum coverage. For example, all states in the country require that passenger carrier vehicles maintain minimum split limit amounts for liability and property damage. In many states, the typical minimum policy limits will range from about 30,000/50,000/20,000 in addition to a combined single limit of about $100,000. These requirements will generally increase as the seating capacity of the passenger carrying the vehicle increases. Simply put, the more seats that the vehicle has, the more insurance coverage that is required.

Certificate of Insurance

All states that provide for passenger carrier insurance coverage require that the owner of the vehicle be able to provide proof of insurance coverage. This proof is usually required in the form of a certificate of insurance that has been signed and issued by the insurance company that provides the passenger carrier vehicle policy. Some states also require that a certificate of insurance be sent directly to the Department of Motor Vehicles once a year or whenever the policy is renewed.

Self Insurance Requirements

There are some states that allow owners and operators of passenger carrier vehicles to self-insure. In states that allow self insurance, the owner or operator is usually required to operate a minimum number of vehicles in a fleet and also required to post a surety bond and obtain a certificate itself insurance from the insurer or bond issuing agency that is then filed with the Department of Motor Vehicles. When compared to minimum insurance policy requirements, requirements for self insurance are usually much higher. For example, owners or operators of carrier passenger vehicles that wish to self-insure, will usually be required to post a bond surety bond that guarantees coverage in an amount not less than $250,000.

Workers Compensation Requirements

Many Departments of Motor Vehicles that issue passenger carrier licenses and permits also require workers compensation coverage for operators of passenger carrier vehicles and other employees that assist with the operation of them. This requirement can also be satisfied by having a certificate of insurance on file with the Department of Motor Vehicles and making sure that the DMV receives a new copy whenever the policy is renewed.

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