Should You Hire Drivers or Lease Owner-Operators?
- Nate Jones, CPCU, ARM, CLCS, AU
- 12 hours ago
- 2 min read
Choosing between hiring company drivers or leasing owner-operators is a pivotal decision for any trucking company. Each model has unique advantages, challenges, and insurance requirements. Here’s what you need to know to make the best choice for your business - and how Wexford Insurance can help you stay protected and compliant.
Company Drivers: Pros, Cons, and Insurance
Company drivers are employees who operate trucks owned or leased by your business. You control their schedules, routes, and the equipment they use.
Pros:
Consistent Operations: You set the standards for safety, maintenance, and customer service.
Brand Control: All trucks display your company branding, ensuring a unified image.
Employee Loyalty: Drivers are more likely to stay long-term with benefits and steady pay.
Simplified Compliance: You manage all regulatory and insurance requirements.
Cons:
Higher Overhead: You’re responsible for truck payments, maintenance, fuel, and insurance.
Administrative Burden: Payroll, HR, and compliance tasks increase as your fleet grows.
Recruitment Challenges: Finding and retaining quality drivers can be difficult.
Insurance Needs:
As the employer, you must provide:
Physical damage coverage
General liability
All insurance is managed and paid for by your company, shielding drivers from personal liability.
Owner-Operators: Pros, Cons, and Insurance
Owner-operators are independent contractors who own or lease their own trucks and contract with your company to haul loads.
Pros:
Lower Fixed Costs: Owner-operators cover their own truck payments, maintenance, and some insurance.
Scalability: You can quickly expand your fleet without large capital investments.
Motivated Partners: Owner-operators are business owners, often highly motivated to maximize efficiency and earnings.
Cons:
Less Control: You have limited say over equipment standards and driver behavior.
Brand Consistency: Trucks may not always display your company branding.
Contract Management: You must ensure contracts are clear and compliant with labor laws to avoid misclassification penalties.
Insurance Needs:
Primary liability insurance is typically provided by your company if the owner-operator is leased to you.
Physical damage and non-trucking liability are usually the owner-operator’s responsibility.
Cargo insurance may be required by either party, depending on the contract.
Owner-operators running under their own authority must secure all required insurance themselves, including liability, cargo, and physical damage coverage. Costs can be significantly higher for owner-operators with their own authority compared to those leased to a carrier.
Which Is Right for Your Trucking Business?
Hire company drivers if you want maximum control, consistent branding, and are prepared to handle higher administrative and insurance costs.
Lease owner-operators if you want to scale quickly, reduce fixed costs, and work with experienced, entrepreneurial drivers.
Final Thoughts
No matter which model you choose, having the right insurance is critical. Wexford Insurance specializes in comprehensive coverage for both company fleets and owner-operators. We help you navigate FMCSA requirements, protect your assets, and ensure your business is always compliant.
Contact Wexford Insurance to explore coverage options for company drivers, owner-operators, and new ventures.
