by Ed Sneneh
Trucking insurance and tow truck insurance have a number of similarities and dissimilarities. Commonalities come from the fact that both types of businesses do operate commercial vehicles that haul merchandise or other items on public road, and for that reason they need insurance protection in case their activities cause bodily injuries or property damage to other people. At the same time, tow trucks is not similar to other interstate common carriers, for example, when it comes to legal and business requirements.
Commercial Auto Liability Insurance. This coverage is needed from all commercial vehicles that run on public highways. Protection is basically the same although different protection limits of liability may be mandated by law. Limits of liability insurance for trucking and towing businesses that require federal filing may start at $750,000 and up. In Illinois, tow trucks for hire are required to maintain a $750,000 liability limits on their commercial auto insurance. In Illinois, the minimum liability insurance limits that apply for both commercial and personal auto insurance is $20,000 bodily injury for each person, $40,000 bodily injury each accident, and $15,000 property damage each accident.
Private trucking that are not required to file with local and federal authorities maybe exempt from high liability limits. For example, truck you own for delivery of merchandise to your furniture store customers may not require any high limits.
Motor Truck Cargo Insurance. A commercial vehicle that is used to move items of other people from one point to another may need property insurance to cover those items. Items hauled by interstate trucking businesses may include food, frozen food, animals, household items, plastic products, office supplies, plastic items, and other non hazardous and hazardous materials. Insurance covering properties while it is in transit is called ‘Inland Marine.’ In the trucking business the coverage is called Motor Cargo Liability Insurance. In the towing business physical damage coverage on customers vehicles is called ‘Garagekeepers Liability Insurance.’ When vehicles are in tow, the coverage is called ‘On Hook Coverage,’ as opposed to ‘Off Hook Coverage’ which provides protection for towing businesses when and if their customer’s vehicles are in storage, in the care and custody of the towing business.
Truck Physical Damage Insurance. This coverage is offered to both types of businesses. This coverage is not mandatory by law, but will be required if the insured trucks have lienholders or are leased or financed somehow, or if the owner of the truck is seeking physical damage protection for their own trucks.
Garage Liability Insurance. This coverage applies to all business whose operations involve the use of automobiles, such as car dealers, mechanic and body shops, as well as tow trucks. Garage Liability Insurance offers protection against incidents related to the negligent activities of the auto-related business.