Oversize and Overweight Vehicle Bonds Claims Guide

Public, private, and commercial motorists that operate vehicles or loads that are considered to be oversized or overweight by a governing regulator typically require a permit and surety bond before they may travel upon state roads and highways.

Depending on what state you live in, this surety bond may be referred to under various names such as an Excess Size and Weight Bond, Super Heavy Load Bond, Over-Dimension Vehicle Bond, Excess Haul Permit Bond, etc., but most commonly it’s called an Oversize and Overweight Vehicle Bond.

So, What Is the Purpose of an Oversize and Overweight Vehicle Bond?

Well, Jet Insurance Company provides the surety bond to act as a financial assurance to the governing regulator (usually your local Department of Transportation) that the motorist will follow the regulations of their permit. 

Permit requirements include following the approved route and schedule, paying all annual and/or monthly fees due, and fixing any costs of roadway, highway, or private property destruction caused during a trip. In cases where the driver fails to fulfill any of these obligations, the permit bond will be used as a means of restitution by the governing regulator, or any other damaged party, to cover the financial losses they face due to the permit transgression(s). 

One of Jet’s main goals is to protect our customers from baseless claims, so let’s go over the best ways to avoid a permit violation and what to do should an official claim ever arise. 

Steering Clear of an Oversize and Overweight Vehicle Bond Claim

The type of permit you hold will generally be based on the logistics of your vehicle or load as well as your proposed schedule and route. For instance, you may need an annual blanket permit that covers all of your hauling trips for the year or a one-trip permit that is only good for ten days. Either way, it is important to uphold the regulations of your approved permit. 

To ensure you are aware of what NOT to do as a motorist of an oversized and/or overweight vehicle, the Jet team has gathered various examples of prohibited acts:

• Failure to follow the times, dates, and authorized routes of your permit schedule
• Non-compliance with operation requirements (e.g. proper gear, escorts, flags, lighting, and speed)
• Non-payment of monthly or annual permit/traveling fees
• Causing damages to public property (street signs, roadways, highways, etc.) or private property and refusing to pay for the costs to fix such damages

Claims Process Details

Who Can File a Claim on an Oversize and Overweight Vehicle Permit Bond?

Additionally, any person who has suffered financial losses due to their personal property being damaged by the motorist can pursue civil action against the bondholder which can lead to a bond claim.

Are There Limits to Claim Filings?

Yes, claims are limited in regards to the amount that may be paid out by the surety provider (Jet) and when exactly a claim may be filed.

Payments for justified claims may never exceed the amount of liability covered by the surety bond (this is represented by the dollar limit). Oversize and Overweight Permit Bond limits range from just $1,000 to $500,000 and are managed by the governing regulator. The required limit is generally found in the statutes or may be determined by the governing entity. In cases where the bond amount is custom, it is usually based on the overall size and weight of the vehicle or haul. 

Typically, a claim may only be filed during the duration of your bond term (some permit bonds are active for one year while others expire within three months of their effective date). A claim may also be filed at any point within the cancellation period (usually 30 days), as your surety bond is technically active during this time.

However, most Oversize and Overweight Vehicle Bonds may not be cancelled as they are attached to a specific permit that will remain active for no more than one year, so you typically won’t have to worry about the extended liability that comes with mandated cancellation periods. Your bond will simply expire on its designated expiration date and the claim window will end.

What Would an Oversize and/or Overweight Vehicle Bond Claim Look Like?

A motorist of an oversized and overweight vehicle (Aaron) has recently been approved for a single-trip permit by the North Carolina Department of Transportation (NCDOT). The permit is good for 10 days for a one-way trip from the City of Durham to the City of Charlotte. 

Unfortunately, Aaron’s trip doesn’t start off very well. While driving on the approved route and schedule for day three, Aaron falls asleep at the wheel and loses control of the vehicle which results in a damaged street sign, guardrail, and cracked asphalt. However, no one was around to witness the accident, and Aaron’s vehicle is ok to drive, so he continues his trip and hopes that no one will notice the destruction he caused.

Complaint

Well, someone noticed the destruction and notified the NCDOT just a few hours after Aaron had left the location of the accident.

Investigation

An investigation begins and the NCDOT finds that there was indeed a witness to the accident. The witness describes Aaron’s vehicle and some details regarding the incident which leads a member of the NCDOT to review their recently approved oversize and overweight vehicle permits. The logistics of Aarons’s permit and his vehicle match the witness testimony and he is contacted directly by the NCDOT. Once approached about the accident, Aaron admits his guilt and is required by the NCDOT to pay for the cost of fixing the damages caused to the roadway.

Restitution

As you may have guessed, Aaron doesn’t have any extra cash on hand, so he is unable to reimburse the NCDOT for the cost of fixing the street sign, guardrail, and cracked asphalt. Because of this, the NCDOT is forced to file a claim on Aarons’s Oversize and Overweight Permit Bond. 

The NCDOT sends notice of the claim on Aaron’s bond to the surety provider (Jet). Once notified, the Jet team reviews all information and documentation available. Even if a previous investigation has been administered, the Jet team always conducts our own to ensure false claims are not paid out.

Due to Aaron already admitting wrongdoing, Jet can’t do much to defend him. The NCDOT claim on Aaron’s Oversize and Overweight Vehicle Bond is justified and payment is made (claim payouts will never exceed the bond limit).

Indemnification

Once the NCDOT claim has been settled, Aaron will be expected to reimburse Jet for the payout that was made on behalf of him causing roadway damages and violating the regulations of his permit. Like all other surety bonds in the industry, the Oversize and Overweight Vehicle Bond is similar to a line of credit rather than insurance. Once credit has been used, it must be paid back. Failure on Aaron’s behalf to repay the surety bond may result in future problems obtaining permit bonds for the operation of oversized and overweight vehicles or hauls in the State of North Carolina. 

Every state’s laws vary slightly, so it is in your best interest to read up on these regulations for each state that you operate an oversized and/or overweight vehicle in. Take a look at the chart below for further details.