The Two Losses Your MCS-90 Will Never Pay

Two exclusions sit inside the MCS-90 itself

Almost every owner operator has an MCS-90 attached to a policy somewhere, and almost nobody has read the middle paragraph. Our MCS-90 endorsement page covers the big idea, that the endorsement is a promise to the public rather than coverage for you. This post is narrower. The text names two categories of loss it will not reach at all, and one event that has to happen before it pays a dollar.

Your freight is excluded by name

Here is the sentence, straight off Form MCS-90. "Such insurance as is afforded, for public liability, does not apply to injury to or death of the insured's employees while engaged in the course of their employment, or property transported by the insured, designated as cargo."

The wording is the same on every carrier's copy, because 49 CFR 387.15 requires the endorsement to be in the form prescribed by FMCSA. Read the back half of that sentence. The load you were paid to move is written out of the endorsement. Public liability, as the form defines it, means bodily injury, property damage, and environmental restoration, and freight riding on your deck under a bill of lading is not in that bucket.

The federal rules barely mention cargo at all. Every limit in Part 387 is a public liability limit. The only cargo security the federal scheme requires sits at 49 CFR 387.303(c), it applies to household goods motor carriers, and the numbers are $5,000 for loss or damage on any one motor vehicle and $10,000 for all losses at any one time and place. If you haul general freight there is no federal cargo minimum for you. Every cargo limit you have been asked to carry came out of a broker or shipper contract, and it is answered by a separate motor truck cargo policy with its own perils and conditions.

So are your own employees

The front half of that same sentence removes injury to or death of the insured's employees while engaged in the course of their employment. The person closest to the crash is the person the endorsement does not answer for. A driver hurt in a wreck is a workers compensation question under your state's law, or an occupational accident program if you are set up that way, and the MCS-90 is silent on both.

It answers to a final judgment and nothing less

The operative promise on the form is that the insurer "agrees to pay, within the limits of liability described herein, any final judgment recovered against the insured for public liability resulting from negligence in the operation, maintenance or use of motor vehicles subject to the financial responsibility requirements of Sections 29 and 30 of the Motor Carrier Act of 1980 regardless of whether or not each motor vehicle is specifically described in the policy."

The unscheduled truck part is real and it is why the endorsement exists. The trigger is what people miss. A final judgment is the end of a lawsuit, so the endorsement is not a fund for defense lawyers, adjusters, or a negotiated settlement in month three. That ordinary claim work lives in the underlying commercial auto liability policy, and the MCS-90 does not quietly fill a gap there. The form says as much about its own limits table, in a footnote reading that the schedule of limits shown does not provide coverage and the limits shown are for information purposes only. Two other mechanics are worth knowing. A judgment creditor may sue the insurer directly to compel payment if it fails to pay, and the limits apply separately to each accident, so paying on one accident does not reduce what is owed on the next.

Small wording that decides whether the filing counts

A few details cause most of the paperwork trouble we see. 49 CFR 387.15 says the endorsement must be issued in the exact name of the motor carrier, so a DBA, an old entity name, or a dropped LLC is worth fixing before an adjuster finds it. 387.7(d) requires proof at your principal place of business, and that proof is the MCS-90, a Form MCS-82 surety bond, or a written FMCSA authorization to self insure under 387.309. And 387.7(e) makes that proof public information which must be produced on reasonable request, so attorneys and brokers can and do ask.

On cancellation, 387.7(b)(1) sets 35 days written notice between insurer and carrier, running from the date the notice is transmitted, and the form adds 30 days notice to FMCSA where the carrier is subject to registration under 49 U.S.C. 13901. The endorsement and filing sequence is laid out end to end on our MCS-90 filing page.

None of this is a reason to fear the endorsement. It is a reason to stop treating it as coverage. The form also says the insured agrees to reimburse the insurer for any payment it would not have owed except for the endorsement, so the only thing standing between you and that invoice is a policy written around the trucks you actually run and the freight you actually haul. Get a truck insurance quote and we will read your policy against your MCS-90 and show you where the two do not line up. Start your quote here or call or text 423-264-4255.