by Ed Sneneh, Chicago Insurance Agent

Shopping for tow truck insurance in Chicago may be a challenging and stimulating experience. For one thing, there are many insurance companies that exist at any particular time offering tow truck insurance. Second, insurance rates for tow truck insurance can change in a very exotic manner, where insurance rates for the towing business across the street may be different than yours.

Businesses that need towing permits from the state of Illinois include: Roadside service providers, car salvage firms, auto club contractors, rotational towing, auto repair shops, auto body shops, and full-service gas stations. There might be other business such as used car dealers that may be interested in towing permits.
The large size of the Chicago markets makes it appealing for insurance companies to enter the towing insurance business. However, Chicago is not the best place to make money for insurance companies that compete based on price. While offering lower premium is healthy to the consumers, intense competition between the many companies lead to unfavorable outcomes. Lower rates may be good news to customers, but reduction in the quality of services are a key result for price competition. The intense competition makes it easy for insurers to come and, and perhaps easier to depart the market.

Mandatory coverages for towing businesses in Chicago and Illinois are based on vehicle weight. Regardless it is recommended to have a minimum auto liability of $500,000 combined single limits, similar limits for garage, and minimum of $25,000 of on hook coverage (insurance on cars while on hook and in tow). These three coverages are necessary for a tow truck license to be issued. For certain towing businesses that require ICC filing a minimum of $750,000 combined single limits in auto liability. Form H & Form E are mandatory for towing business that require ICC Filing. Form E filing attests that the trucking auto liability insurance complies with the state's financial responsibility laws.  Form H filing guarantees your state that you have sufficient Cargo Liability insurance (in towing it is called on hook).

Optional coverages include physical damage coverages on own trucks (comprehensive & collision), off hook coverage (covering vehicles in storage with the towing business), commercial general liability to cover premises and non auto liability. If the towing business owns property then property coverage may be needed.

A mandatory coverage that may be waived under certain circumstances such as single owner operator business is workers compensation. Workers compensation is a mandatory coverage for all wage paying businesses including towing. Rate for tow truck workers compensation is one of the highest in the market.

Obtaining the best tow truck insurance rates begin by contacting an independent insurance agent. While many companies offer tow truck insurance you may not find them all offering comprehensive and similar coverages. Some companies provide more discounts for prior insurance and good credit for applicants while punishing hardly for MVR blemishes. An example of those companies is Progressive Auto Insurance. Other companies are more lenient on issues like those. Obtaining a couple of quotes and dealing with a knowledgeable agent is the key to getting better price.
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Insurance Navy is a leader in the tow truck business. Get your online tow truck insurance quotes or call us at  (708) 233-4848
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1 Comments

Tow Truck Insurance said...
Thank you Ed Seneh, for sharing shopping tow truck insurance around Chicago.
WEDNESDAY, JUNE 29 2011 8:10 AM

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