This article is related to towing for- hire business in the State of Illinois and the coverages associated with running such businesses. The following coverages are needed for for-hire-towing:
a. Business Automobile Liability Insurance. There are a number of different requirements that the State of Illinois requires from all towing trucks. For example towing trucks with GVWR of 10,000 pounds or more are required to file Form E certificate with a minimum limits of $750,000 These limits can be higher if the towing is involved in moving HAZMAT (Hazardous Material), and it can be lower with lighter trucks. This is called Form E for filing purposes.
b. Garage Liability Coverage: This is coverage pays for property damage and bodily injury resulting from the operations of the towing business. It typically does not cover accidents and damage to vehicles that are towed, as there is a separate insurance contract for such items, but it does cover vehicles that are owned by the towing business. The amount of Garage Liability normally matches the coverage in paragraph a above (Auto Liability.)
c. GarageKeeper Liability (on Hook) Coverage: Towing truck businesses want this coverage to provide protection in the events of physical damage to the customer's cars when they are (on the hook) in tow. This coverage is mandatory for people needing Form H or Cargo filing and is called On Hook Coverage. Garage Keeper Liability can also be Off Hook (coverage on customers' vehicles if the towing business stores customers vehicles on their premises.) Off hook coverage is not mandatory.
Form E and Form H above must be filed by the insurance company to complete the state filing process. To have their plates registered each towing business is required to produce a Certificate of Insurance covering their trucks and specifying the State as a Certificate Holder. Not all insurance companies that provide these coverage may do filing. If the insurance coverage on a tow truck was obtained in connection with a business policy (repair shop), then the insurance company may treat the tow truck as a business auto, and not as a tow-for-hire business. In that case the classification would change.
Other coverages for towing business may include property & general liability, workers compensation, physical damage on scheduled trucks, towing, road side assistance, and other optional coverages.