Trucking Terms Glossary

Learn all of the lingo associated with the trucking industry

Terms All Truck Drivers Should Know

While you may or may not understand semi-trucks inside and out, know that when it comes to insurance, a lot of jargon will be used. Brush up on your trucking terms with this glossary from Prestige Trucking Insurance, covering truck drivers in all fifty states.

Trucking-Related Acronyms to Remember

- ACV: Annual contract value
- COI: Certificate of insurance
- DBA: Doing business as
- MC: Motor carrier
- EFT: Electronic funds transfer
- GVW: Gross vehicle weight
- MVR: Motor vehicle report
- PAE: Permanently attached equipment
- VIN: Vehicle identification number

Glossary of Trucking Terms

‍Doing Business As (DBA)  — this is the name a company operates under in public but is not the name of the actual company. For example, a sole proprietorship created by John Doe may use the DBA, “Dallas Contractor Service,” if they are in the contracting business.

Electronic Funds Transfer (EFT) — this can be an insurance premium payment option in which funds from your checking or debit account are automatically swept on a monthly basis. There is often a discount associated with this payment option.

‍Filing — a certificate registered either on the federal and/or state level that shows the vehicle has the mandated minimum amount of liability. This is a certificate registered with either Federal or State insurance governing bodies that demonstrates a commercial vehicle has a mandated minimum amount of liability insurance. Filings can be required when a vehicle exceeds a certain gross vehicle weight (GVW), carries passengers (commercially), or carries hazardous materials, such as oil/gas, or pollutants.

‍For-Hire Trucking — describes a type of trucking where an individual owns their own tractor and hauls or transports goods for another individual or company. This type of trucking is often more expensive to insure than an “owner-operatory” company.


Gross Vehicle Weight (GVW) — this term describes the fully-loaded weight of a vehicle. It includes the vehicle weight itself, in addition to the maximum load it can carry. Insurers use GVW as a rating factor for insurance, as the heavier a vehicle is the longer it takes to stop. Slow stopping ability can lead to more accidents. State and Federal trucking regulations will often choose a certain CVW to decide if a vehicle requires a filing.

Interstate — crosses state lines. Describes trucking operations that transport goods across state lines. This type of trucking operation would likely require a filing.

‍Intrastate — does not cross state lines, only operates in one state. Describes trucking operations that do not cross a state line in their normal course of business. There are some insurers that will allow incidental travel across state lines. Depending on the GVW of the vehicles involved in the transportation of goods, a filing may be required for this type of operation.

‍Lease Operator — a type of trucking contract in which an individual or company leases a tractor and/or trailer in order to haul or transport goods. Non-trucking liability coverage would be necessary to insure the operatory when using a leased vehicle for non-commercial purposes.

Lease/Finance Value — during the first half of a five-year lease or loan, the payoff is usually higher than the actual cash value of the unit, and insurance policies are typically only obligated to pay the actual cash value amount. Any difference is the insured’s personal obligation. Lease/finance value coverage responds after a total loss to pay off the cost of a lease or loan when it exceeds the unit’s actual cash value.

‍Owner Operator — a type of trucking where the individual or company owns their own vehicle and transports their own goods. This type of trucking operation is often less expensive to insure than a for-hire operation, depending on what is being hauled.

Permanently Attached Equipment (PAE) — this is anything attached to a vehicle that is used for day-to-day operations in the insured line of work. It typically must be welded on or bolted on to the vehicle to be considered permanently attached. For example, a MIG welder attached to a flatbed for use in welding on a worksite would be considered permanently attached. Insurance companies will want a record of the attached equipment (receipts, pictures) in order to help determine the overall value of the vehicle when purchasing physical damage coverage. If a vehicle is manufactured with a piece of equipment for a specific purpose, a bucket truck, for example, it is not considered PAE.


Placard — any sign on a commercial vehicle used to notify the public of the goods being transported. Often times it is necessary when there is an inherent element of danger associated with hauling the particular good or substance (oil/gas or highly flammable liquids or gasses). For example, you may see a diamond-shaped placard with a skull and crossbones on it when a vehicle is transporting a toxic substance.

Primary Use — describes the main use of the vehicle being insured. It may be personal, business, both, or neither. The primary vehicle use type is used as a rating factor to help an insurer calculate a premium.

‍Radius (or Radius of Operation) — describes the typical distance a commercial vehicle will travel from its principal garaging address. Insurers use the radius to calculate a policy premium. The difference between a 50-mile radius and an unlimited radius of operations can make a vast difference in the overall cost of your insurance. A personal auto policy typically has an unlimited radius but is rated on mileage.

Split Limits — describes liability limits in which there are different limits applied to the liability portion of your policy regarding the maximum money that will be paid per person, per accident, and for property damage coverage.

Stated Amount — a property value determination made by an insured regarding the value of the property they are insuring. It is also a loss cost settlement valuation used to determine how much a vehicle is worth in the event of a physical damage loss. Ultimately, it is the insured’s proposed value of the property at the time of policy inception. It should include depreciation and can be described as what you would see the vehicle for at the time the policy is issued.

This is not the same as ACV or replacement cost value. Some industry participants do not like this loss cost settlement method, as the insured may not be knowledgeable enough to present an accurate evaluation. Also, in the event of a claim, this method can lead to disputes between the insured and the insurer. It is often necessary for larger trucks that are customized.

‍Straight/Box Truck — truck in which all axles are attached to a single frame (truck and trailer are connected as one).


Trailer Interchange Agreement/Contract — a trailer interchange agreement is a contract that arranges to transfer a trailer from one trucker to another in order to complete a shipment. This can be an agreement between two entities in which trailers are shared (even though separately owned) as a means to reduce the cost of non-utilized trailers, which don’t earn any money while they sit, or may cost money to be returned to an origination point empty.

Vehicle Identification Number (VIN) — this is the unique 17 digit vehicle identification number a vehicle manufacturer will assign at the plant the vehicle is made. Insurers use this number to verify exactly which vehicle they are insuring on a policy. It is possible to get a quote without this number, but it will be necessary to provide the VIN in order to keep the policy from canceling.

Workers Compensation — a schedule of benefits payable to an employee by his employer without regard to liability, required by state law in the case of injury, disability, or death as the result of occupational hazards.