Jul 19, 2017 • Brokers

Freight Broker License

Freight Broker License

Learn how to get a freight broker license and move freight in a few easy steps.

Freight Broker License

The freight industry is continually expanding and having a freight broker license gives you the authority to earn money by moving truck freight without actually hauling it.

A freight broker license allows freight brokers the authority to move freight by connecting shippers with carriers, essentially brokering the deal. Freight brokers are hired by shippers who have freight that needs to be hauled from one location to another.

Let’s say there is a furniture warehouse in Texas that needs to ship its freight to department stores in Georgia. The warehouse representative is the shipper, who needs to find a carrier to haul the load. This is where the freight broker comes in.

With a freight broker license you are paid by the shipper to find a carrier to haul the load. You can use your broker authority to find qualified carriers on load boards like Truckloads by either posting information about your freight or by doing a truck search to find a potentially interested carrier.

Freight Broker License Cost

To get a freight broker license and have broker authority you must apply for a US DOT number with the Department of Transportation first. Once approved, use your DOT Number to get a Motor Carrier (MC) number and broker authority with the Federal Motor Carrier Safety Administration (FMCSA). This is approved through the completion of the OP-1 Form which includes a $300 application fee.

Broker Authority

Having broker authority isn’t the only requirement to become a freight broker. You will need to decide if you want to start a freight broker company or if you want to work for an established brokerage company.

Regardless of your choice, you should be sure to do ample research in order to better understand the nuances of the trucking industry and which options are best for you. We’ve provided a step-by-step guide to help you become a freight broker.

Guide to Become a Freight Broker

TagsFreight Broker

Freight Broker Bond [p] Want a freight broker license? You'll need a freight broker bond of $75,000 first.[/p] [h2]Freight Broker Bond[/h2] [p]The freight broker bond is one of the lesser known parts of being a freight broker but it’s quite simple, and once you get a better understanding of it, you should feel as comfortable with your freight broker bond as you do with getting car insurance.[/p] [h2]What is a Freight Broker Bond?[/h2] [p]A freight broker bond is a form of a surety bond, which is like an insurance policy for a contract, though it doesn't take the place of liability insurance. It is a legal commitment made by one party to another to pay a certain dollar amount if the terms of a contract are not met. [/p] [p]In this instance, the bond protects a customer from losses if you don’t come through as well as giving carriers the peace of mind knowing they will be paid in a timely manner.[/p] [h2]BMC-84[/h2] [p] The BMC-84 is essential to your freight brokerage as it reassures carriers and companies that you have the backing to broker deals. BMC-84 is the bond for $75,000 and is required by law. It is necessary to cover payouts of possible claims (damages, broker negligence, failure to pay, etc). [/p] [h2]Applying for a Freight Broker Bond[/h2] [p]A freight broker bond can be acquired from any insurance agency such as Liberty Mutual, The Hartford, among hundreds of others. Alternatively, you can search for specific firms in your state who specialize in freight broker bonds. [/p] [p]When you're ready to select your agent of choice they will all require the same information to process your BMC-84: exact business name as it appears on the business license, the exact dollar amount for bond, business address, and all business/personal financial records. [/p] [p]You must pay a percentage of the freight broker bond up front before the agency will process it. Usually, this annual premium will be between $900-$2,000 depending on your credit. It can be paid for with a credit card or check in most instances and takes about 24 hours to process.[/p] [h2]Can I Get a Freight Broker Bond With Bad Credit?[/h2] [p]Yes, you can still get a bond. If you have bad credit it’s not impossible, but it will increase your cost to secure a bond which can run upwards of $2,000. Keep in mind that surety bonds do not affect your credit score so it wouldn't hurt to search around though it's best to start at the bigger agencies first. [/p] [p]The larger the firm the more freight broker bond providers they work with which increases your odds of being approved. Just remember the premium on the freight broker bond is a percentage of the bond itself, so if your credit is bad the premium will be higher. Even though you will have to pay more up front it allows you to open your business and provides an umbrella in case of any freight claims.[/p] [h2]Freight Broker Bonds and Claims[/h2] [p]Trucking is dangerous and things are bound to go wrong on the road from time to time. Customers will understand that. However, when things do go wrong, someone needs to be held responsible and pay the damages. Similar to a car accident, there will be a resolution and one party must pay out to the other.[/p] [p] This is why it is required for companies to maintain a $75,000 bond. If you're found responsible and must pay out on the claim, your bond will act as a line of credit to do so. Before being issued your bond you must sign a legal document to repay in full in the case of such a payout. [/p] [h2]Bonding Agency [/h2] [p]When selecting your bonding agency to try to use one who is also a Managing General Underwriter (MGU) bonding agency. MGU Agencies can and will help you through each stage of a claim. It is recommended to do everything possible to be proactive when issues arise on loads to prevent claims from being filed. Just like car insurance the more accidents, you have on your record the harder it is to get insured. Only here not being able to get a bond can cause you to go out of business as they are required to operate.[/p] [p]Remember DO NOT submit your proof of insurance directly to the FMCSA. The FMCSA requires that your insurance company submit the form and insurance certificate on your behalf.[/p] [h2] I Have a Freight Broker Bond, Now What? [/h2] [p] Now that you've covered your freight brokerage from potential claims with your freight broker bond, you can either continue to start your freight brokerage company or if you're ready, explore load boards to help you post loads that qualified carriers can view.[/p] [button-white href="https://truckerpath.com/blog/how-to-become-a-freight-broker/"]How to Become a Freight Broker[/button-white] [p]Freight brokers who use Truckloads have the ability to connect with over 100,000 qualified carriers ready to haul their freight. You can even track your loads to verify a carrier's location and ensure that your customers delivery is going according to plan. [/p] [button-green href="https://truckerpath.com/truckloads/broker-load-board/?utm_source=blog&utm_medium=brokerbonds&utm_campaign=aug2"]Get Started With Truckloads Now[/button-green]

Jul 26, 2017 • Brokers

Industry Update March 22, 2019 <h3>Trucking Industry Update March 22, 2019</h3> <h5>By Jeremy Feucht</h5> <h3><strong><u>Did you Know?</u></strong></h3> March 22, 1933, President Roosevelt signed the Beer and Wine Revenue act, which basically killed Prohibition. This started the shipment of alcohol again in earnest and culminated in the signing of the 21<sup>st</sup> Amendment in December of 1933, officially ending Prohibition. <h3><strong><u>Trucking tip of the Week</u></strong></h3> Getting loads to the final destination on time is key to getting paid the full rate. During the Spring, especially this Spring, wind has been a major factor. Trucks, being top heavy, are easily tipped over. Pay attention to wind speeds in the area you are going through, in particularly through the Plains. Being late is better than not getting there at all. <h3><strong><u>Declarations of Emergency</u></strong></h3> This section has been a constant for the last several weeks. This week is no different. Nebraska is having massive flooding issues and are in desperate need of water, fuel and many other items. Make sure you are planning accordingly if your route takes you through Nebraska. <h3><strong><u>Toll Road Fight</u></strong></h3> The ATA sued the state of Rhode Island on their implementation of toll roads. The suit was initially brought up in July of 2018 but is just now being ruled on. Unfortunately, the suit has been dismissed but not due to the legality of the law. The presiding judge felt that the <a href="https://www.ttnews.com/articles/court-dismisses-atas-lawsuit-against-rhode-island-truck-tolls">suit should be brought up in state</a> court first. The ATA has declared that they will continue the fight. <h3><strong><u>Legislation</u></strong></h3> If you drive in the agriculture business, a new piece of legislation has been introduced that you need to keep an eye out on. HR 1673, The Agricultural Trucking Relief Act, has been introduced by Representative Austin Scott (R-GA),is set to further clarify what is classified as an agricultural commodity. While the full bill has yet to be released, you will be able to read the bill in its entirety <a href="https://www.congress.gov/bill/116th-congress/house-bill/1673/text?q=%7B%22search%22%3A%5B%22HR+1673%22%5D%7D&r=1&s=2">here</a> when its released.

Mar 22, 2019 • Carriers

Truck Parking Issue Can Cost the Industry $5 Billion Annually [p]Finding safe truck parking is a looming issue that can cost the trucking industry an estimated $5.1 billion annually.[/p] [h2]3 Factors to Help Resolve the Truck Parking Issue[/h2] [p][b]1. Increase Capacity in Areas of Need[/b][/p] [p]After examining the data at over 270,000 truck parking spots in 2016, we found that in the Western areas of America, it is nearly impossible for a truck driver to find truck parking nearby within 45 minutes. After surveying over 3,000 truck drivers we discovered that [i]40 percent of truck drivers spend an hour or more searching for nearby truck parking.[/i] That's nearly 10 percent of their allotted daily driving time![/p] [img src="https://truckerpath.com/uploads/2017/05/bottom-infgr-e.png" alt=""] [p][b]2. Increase the Use of Technology to Help Find Truck Parking[/b][/p] [p]Technology can provide truck drivers with necessary information to find nearby truck parking. [a href="https://app.appsflyer.com/com.sixdays.truckerpath?pid=Social Facebook"]Trucker Path[/a] is a necessity for truck drivers who need to find nearby truck parking. There are over 8,000 truck stops, rest areas, and travel centers in the app with real-time updates regarding the available truck parking.[/p] [p][b]3. Improve Trip Planning and Efficiency by Drivers[/b][/p] [p]Most drivers plan ahead by searching for truck parking along their route. However, on average, 16 percent of truck drivers say they start to plan for parking 30 minutes or less before hitting their HOS limit. For truck drivers to find available parking in a timely manner, especially in the Western part of the U.S., they should begin the process at least one hour ahead of hitting their HOS limit.[/p] [p]Fleets can also help their drivers by providing them with necessary recommendations or having technology like Trucker Path loaded onto in-cab devices. While some fleets are proactive, this is not standard as 86 percent of truck drivers say their fleets don't give them recommendations on how to find parking.[/p] [p][b]Using Trucker Path can save drivers an estimated 11 hours per month![/b][/p] [video id="NSSOwFRJaQw"] [h2]Lost Opportunity for Fleets and Truck Drivers[/h2] [p]Time spent searching for truck parking can limit a driver’s earning potential. [i]If over 1.6 million truck drivers in America lose 11 hours every month, then the trucking industry is losing about $5.1 billion annually.[/i] Here is a detailed breakdown of the potential lost opportunity.[/p] [images src="https://truckerpath.com/uploads/2017/05/chartcaption.png" alt="Cost of parking" width="316px" align="left"] [h2]Unauthorized Truck Parking is Unsafe[/h2] [p]Truck driver safety also plays a role in the truck parking issue. In 2015, 852 truck drivers lost their life while working, making it the most dangerous job in the USA. [i]79 percent of drivers were forced to violate their HOS because they couldn't find truck parking.[/i] Meanwhile, drivers have been forced to park in unauthorized locations such as highway shoulders, store lots, and off-ramps. These areas are unsafe for truck drivers, leading to potential cargo theft or accidents when merging off or back onto roads.[/p] [h2]What's Being Done to Help Truck Drivers?[/h2] [p]Truck drivers don't feel enough measures are being implemented to help them. [i]86 percent of truck drivers we surveyed said they feel the government isn't doing enough to help alleviate the truck parking issue.[/i] There are a few states that have taken the initiative in helping provide solutions for truck drivers.[/p] [p]States such as Kentucky and Florida (among others) now utilize weigh stations for truck parking, known as “rest havens”. Meanwhile, Maryland and Delaware have provided corridor parking for trucks along I-95 resulting in 220 available truck parking spots.[/p] [p]Reopening rest areas for trucks to use for parking is another potential opportunity. Many rest areas were closed since 2008 due to state and city budget decreases. Rest areas that are closed like in California, where there are 13 not in operation could provide an average of 10 truck parking spots per location. The operational costs could be limited by providing only basic restrooms and security like surveillance or a rotation of a security officer on duty.[/p] [button-white href="http://assets.truckerpath.com/external/2017-05-04-pdf/parking-shortage-costs-the-trucking-industry-5B-annually.pdf"]Entire Report[/button-white]

May 04, 2017 • Carriers