Motor carriers are one of the primary forms of shipping used in the United States today, and the industry has been growing with the development of highways throughout every state in the United States. But with increased motor carrier traffic comes increased insurance paperwork involved in the licensing and certifying drivers, vehicles, and cargo.
The insurance requirements laid out by the Federal Motor Carrier Safety Administration (FMSCA) for motor carriers can be confusing. This is especially true when considering the forms necessary to hold a valid license as a broker, forwarder, or carrier of cargo in any kind of motor carrier capacity. These transportation documents are easy to confuse with one another, especially without the help of any kind of shipping document management. Fortunately, there are shipping document management services out there like eFileCabinet specialized for the use in the transportation industry and respected by businesses who know the importance of maintaining and backing up up-to-date FMSCA documentation. In this article, we’ll take a look at the various documents that the FMSCA asks for, why they are important, and what they are used for.
Motor Carrier Insurance Forms
The FMSCA requires many different types of forms in order to ensure safety in the motor carrier industry. Below is an introduction to some of the forms most commonly used in the transportation industry.
Form BMC 85
Also called the Broker’s or Freight Forwarder’s Trust Fund Agreement, this form can be found under 49 U.S.C. 13906. In general, this form allows an individual to be held in trust by a shipper or a motor carrier, which means that the trustor will become a forwarder or a broker of any motor carrier services done by the trustee. This same form can be used to nullify an existing trustor and trustee relationship, particularly if the terms of the original arrangement have not been upheld by one of the parties involved.
Form BOC 3
Called the Designation of Agents for Service of Process, Form BOC3 designates an individual who agrees to become an agent for a shipping broker, forwarder, or a business that employs a broker or a forwarder. The person designated by the form then becomes a process agent, who is the primary source of contact for a shipping enterprise in a particular state where the process agent must reside. Brokers and forwarders may designate themselves as process agents for the state where they live in and an enterprise must have one process agent in every state where they operate.
Form MCS 82
Commonly known as the Motor Carrier Public Liability Surety Bond, this form can be found in the Motor Carrier Act of 1980 in Sections 29-30. This document legally binds the Surety (the shipping company) to the Principal (an individual who will become a motor carrier for the shipping company.) In particular, this document designates that the responsibility for the final judgment against the Principal in regards to property damage, environmental harm, and other things relating to the job of motor carrying is transferred to the Surety. From an insurance standpoint, this is one of the most important documents on this list.
Form MCS 90
The Endorsement for Motor Carrier Policies of Insurance for Public Liability can be found in the Motor Carrier Act of 1980 under Sections 29. This form relates to the same topic as Form MCS 82. This one, however, is an endorsement of liability that the Surety from Form MSC 82 takes on for all of the Principals signed under its umbrella. This document is required for most insurances, since it unifies all of a company’s drivers under a single identity that is responsible for any damages caused by any motor carriers that they employ.
Form MCS 90B
Also called the Endorsement for Motor Carrier Policies of Insurance for Public Liability under Section 18 of the Bus Regulatory Reform Act of 1982, this form differs slightly from the previous two on this list in that it endorses the updated rules that apply specifically to buses. It is comparable to Form MCS 90 in that it unifies all drivers employed by a Surety under the updated rules for buses.
As you can tell, there is an awful lot to keep track of when it comes to documentation for motor carriers. Fortunately, eFileCabinet offers a DMS solution designed from the ground-up for the transportation and shipping industry. To learn more about how eFileCabinet can keep your motor carrier business on the right side of the FMCSA, click here to check out our product.