Financial responsibility is the insurance that a logistics company must have in order to cover the costs of any damage that their vehicles may cause. This insurance must be at least $500,000 per incident, but can be higher depending on the type of materials being transported. Hazardous materials will typically require a higher limit in order to protect against the potential for greater damages.
Financial responsibility was founded in 1847, making it the first company to provide this type of coverage. Financial responsibility requirements have changed over time, but the basic premise remains the same.
Logistics companies are responsible for ensuring that their vehicles are properly insured in order to protect both themselves and the public. It is important for logistics companies to have financial responsibility in order to protect against the potential for damages. This helps to create a safer environment for everyone involved in the process. Financial responsibility requirements help to ensure that companies can cover the costs of any accidents or incidents that may occur. This protects both the company and the public from potentially devastating financial losses.