What does 49 CFR 387.7 (Financial responsibility required) require?

Short answer

49 CFR 387.7 requires motor carriers to obtain and maintain minimum levels of financial responsibility before operating a motor vehicle. The minimum levels are set forth in 49 CFR 387.9.

The rule says

"No motor carrier shall operate a motor vehicle until the motor carrier has obtained and has in effect the minimum levels of financial responsibility as set forth in 387.9 of this subpart." (49 CFR 387.7(a))

"Policies of insurance, surety bonds, and endorsements required under this section shall remain in effect continuously until terminated." (49 CFR 387.7(b)(1))

In plain English

This rule means that motor carriers cannot start operating until they have the required insurance or surety bonds in place. The minimum levels of financial responsibility vary depending on the type of cargo being transported and the weight of the vehicle. For example, carriers transporting hazardous materials in bulk may need to have $5,000,000 in coverage. The rule also requires that these policies and bonds remain in effect at all times, with a 35-day notice period for cancellation.

What to do

• Obtain the minimum required financial responsibility as set forth in 49 CFR 387.9 before operating a motor vehicle.
• Ensure that policies of insurance, surety bonds, and endorsements remain in effect continuously until terminated.
• Provide 35 days' notice in writing to the insurer or surety for cancellation.
• Maintain proof of financial responsibility at the motor carrier's principal place of business.