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The United States once heavily regulated trucking businesses in 1887 through the Interstate Commerce Act, which controlled the cost of transporting products and aimed to ensure fair rates.
The Motor Carrier Act, which President Jimmy Carter signed into law in 1980, is the 9th of such amendments that preceded the abolition of the Interstate Commerce Act.
Provisions of the Motor Carrier Act of 1980 targeted motor carriers. The amount of liability coverage required is hefty. And the commercial auto insurance of most motor carriers can’t meet this.
To solve this problem, the motor carriers do an MCS-90 or MCS-90b form filing to comply with the Motor Carrier Act of 1980 minimum MCS-90 requirements.
MCS-90 Endorsement Explained
The MCS90 is one of the requirements for getting a trucking authority from the Federal Motor Carrier Safety Administration.
An MCS 90 endorsement ensures that for-hire and interstate motor carriers can provide adequate indemnification in case their motor vehicles cause an accident that results in bodily injuries, property damage, or environmental damage.
Common Terms Used In The Language of MCS 90
This section quickly discusses the common terms used in the language of MCS 90 form trucking:
Public Liability
FMCSA MCS-90 provides coverage for public liability. Public liability pertains to your financial and legal responsibility over the bodily injuries, property damage, death, and environmental damage that resulted from an accident your vehicle caused.
Accident
Resulting from negligence or outside factors, an accident is an occurrence that leads to environmental damage, bodily injuries, or property damage.
Motor Vehicle
The wording of MCS90 defines a motor vehicle as a land vehicle, particularly a truck, tractor, trailer, or semi-trailer with its own mechanical power or drawn through one and is used for transporting property.
Bodily Injury
Pertains to the physical harm inflicted on the body such as cuts, wounds, blunt force trauma, fractures, sickness, or disease. On an additional note, the MCS90 treats the infliction of bodily injuries as non-intentional.
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Who Needs MCS-90 Insurance Endorsement?
The MCS 90 insurance endorsement is a requirement for all ventures that need a trucking authority from the Federal Motor Carrier Safety Administration. But to give you a specific idea, these are the common businesses that must have it:
- LTL or partial truckload businesses
- Full truckload businesses
- Flatbed trucking businesses
- Reefer trucking businesses
- Expedited trucking businesses
Is MCS90 An Insurance?
Different versions of MCS 90 endorsement definition, even though having separate interpretations, agree on one thing-MCS90 isn’t an insurance policy.
This is merely a document attached to the existing coverage of a motor carrier and provides a guarantee that adequate protection is in place if something bad happens during a trucking operation.
To Which Insurance is The MCS 90 Form Endorsed?
Upon getting it, the MCS 90 form will be endorsed to the commercial auto insurance of the insured. Once MCS 90 is endorsed, it will then grant additional coverage if specific conditions are met.
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How Does MCS90 Work?
To understand how MCS 90 works, let’s understand MCS-90 example on a series of paragraphs written in the “Definitions” section of the MCS 90 form.
Paragraph 1
The first paragraph in the “Definitions” or MCS-90 meaning section. It highlights that MCS 90 grants an additional layer of coverage and ensures that the commercial auto insurance to which it is endorsed complies with the minimum MCS 90 requirements imposed by the FMCSA and the Motor Carrier Act of 1980.
Paragraph 2 (Clauses 1, 2, 3, And 4)
The first clause of MCS90’s second paragraph gives an idea about the scope of the coverage.
As stated, the insurance company, through the MCS90 endorsement, can cover costs when there’s a judgment that requires you to compensate third party bodily injuries, property damage, or environmental restoration.
Also, MCS90 provides protection when liability results from negligence which occurred in any route or territory when you’re trucking.
The third clause states that MCS90 endorsement doesn’t extend its protection to the injury or death of your commercial vehicle’s driver and passengers. Also, you can’t use it to cover losses if your business property got damaged or lost during the trip.
The fourth clause of the MCS90’s second paragraph states that the insurance company can demand reimbursement from you if it provided indemnification when it shouldn’t have otherwise. Here are some situations where this can happen:
- The MCS90 provided coverage for an accident caused by a commercial vehicle you didn’t name on its terms
- Insurance fraud
Paragraph 3
The third paragraph paves the way for legal recourse in case you can’t get covered without justifiable reason. If there’s MCS 90 and the insurance company denies coverage even though the peril is 100% covered, you have all the right to contest in a court of law and demand the insurance company to do its job.
Paragraph 4
The fourth paragraph of the “Definitions” section tells us that the public liability coverage of MCS90 applies on a per accident basis.
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In Practice, When Does MCS90 Provide Coverage?
You must remember that the coverage of MCS 90 doesn’t override the coverage of your commercial auto insurance. So what conditions trigger MCS 90.
The first condition is that your commercial vehicle must have caused an accident while engaged in interstate, intrastate, or foreign commerce while carrying a specific property specified in the provisions of the Motor Carrier Act of 1980.
The second condition; the court must have released a final judgment of negligence regarding the accident to which you’re liable. Also, the lawsuit must have been filed by a third party who is a victim.
The third condition is that your commercial auto insurance must fail to cover the judgments, and you have no other means of taking care of the costs.
If all of these conditions are met, then you can ask the insurance company to grant coverage through MCS 90.
How To File Your MCS90 Endorsement?
You don’t do the MCS-90 filing at FMCSA’s office or website. Instead, the documents you need to submit to the agency are the BMC-91 or BMC-91X, which proves the endorsement has been introduced to your commercial auto insurance.
Filling Up Your MCS 90 Form
In this section, we’ll help you avoid putting the wrong information on your MCS 90 FMCSA form. Follow the steps outlined below.
Step 1: Download A Copy Of The MCS90 Form And Upload It To A PDF Editor
The first thing to do is to download a copy of the MCS90 form at FMCA’s website and then upload it to a PDF editor.
Step 2: Get A USDOT Number
The upper top right corner of the MCS90 form comes with a blank space where you need to input your motor carrier USDOT number and the date FMCSA issued it.
Getting your USDOT number is easy. All you have to do is visit FMCSA’s USDOT registration page then visit these:
- Unified registration system (If it’s your first time getting a USDOT number)
- Existing registrant system
Step 3: Fill Up The MCS90 Endorsement
When you have your USDOT number ready, fill up the top right corner of the MCS90 with the required information and proceed to the other blank spaces.
Step 4; Filling Up The Issued To Blank Space
After inputting the USDOT number and the date it was issued, proceed to Issued To blank space. You will input your trucking company’s name here and its address. But if you’re a sole proprietor, then input your own name:
Step 5: Filling Up The Date Blank Space
You also need to provide details of when you filled up your MCS90 endorsement. You do this at the spot just underneath the Issued To blank space.
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Step 6:Filling Up The Policy Number And Effective Date Blank Spaces
The next information you have to provide is the policy number and the effective date of your commercial auto insurance. If you don’t know, ask your carrier to send a copy of your commercial auto’s certificate of insurance.
Step 7:Filling Up The Name of Insurance Company Blank Space
Finally, you need to state the underwriter of your commercial auto insurance. This is basically the insurance company where you bought the coverage. By the way, if your commercial auto insurance is from a broker, then call a representative and ask who the underwriter is.
Are There Other Alternatives To MCS 90?
If you don’t want to get an MCS 90 endorsement, then the other options are MCS-82 filing and self-insurance.
MCS-82 filing is what’s commonly known as motor carrier public liability surety bond. This agreement ensures that the principal has the minimum insurance requirements imposed by the FMCSA.
As for self-insurance, this is the act of setting aside specific amounts of money for the purposes of paying the responsibilities to the public in case your commercial vehicle causes an accident.
Understand that motor carriers who plan to self-insure must first secure the approval of FMCSA through BMC-40 filing.
