Tow Truck Insurance
Like any other truck driver out there, tow truck operators provide a very valuable service to their community. They are beacons of light and hope during times when drivers think they will never get on their way again. For as much time they spend on the road helping people, they need to be covered properly with tow truck insurance.
Tow truck insurance provides protection for your business and drivers in the event of an accident while on the job. It is an important piece of commercial insurance to have. This guide can help you decide what truck coverages you will need and how to budget for such a purchase.
What is Tow Truck Insurance?
Tow truck insurance is a specialized auto insurance policy that provides coverage for your tow truck(s) and business. It gives you and your employee’s liability insurance along with other policy add-on options like collision and comprehensive coverage.
It also has towing-industry-specific coverage like on-hook insurance that can provide better protection for your business operations and the vehicles in your care. Personal auto insurance cannot provide you with this type of coverage.
Do You Need Tow Truck Insurance?
If you own a towing business or offer towing services in any capacity, then yes. Tow truck insurance is essential and offers vital coverage for both you and your employees, not to mention that every vehicle on the road needs some level of auto coverage.
Tow truck insurance will protect your business from liability, along with paying for repairs following an accident. Without it, you will be expected to pay out of pocket. One accident may be enough to wipe out your business assets completely. You do not want to leave yourself or your employees vulnerable on the road.
Types of Business That Need Tow Truck Insurance
Any business that owns or regularly utilizes tow trucks in order to conduct business needs tow truck insurance. Common examples of businesses that rely on tow trucks include:
- Roadside assistance
- Auto body shops
- Mechanic repair shops
- Auto salvage businesses
- Auto club contractors
Even if your industry is not listed above, but you use tow trucks regularly, you need tow truck coverage. Without the proper and specialized coverage from a trusted insurance company, you leave you and your business financially vulnerable by non compliance with state insurance laws and licensing.
Tow Truck Insurance Coverage Customization
With Tow Truck Insurance being a type of commercial auto insurance, a tow truck insurance policy includes coverages you may encounter in a variety of other plans.
These coverages will help to protect you, your business, and any drivers you have hired. You never want to be caught driving without these basic insurances that tow truck insurance covers.
Tow truck insurance policies will cover the following:
Liability coverage will pay for both property damage and bodily injuries that you cause to another driver in an accident. It will only cover their damage and bodily injuriy, never your own. Liability insurance can also help with legal fees should you be sued by the other driver.
Property damage insurance includes collision and comprehensive coverage. Collision coverage will pay for damage to your vehicle following an accident. Comprehensive coverage pays for damage your vehicle sustains in a non-collision-related incident, like theft or vandalism.
This type of insurance will pay for your and any passengers health and medical expenses that are accumulated following a trucking accident. It pays out no matter who was at fault for the collision.
Uninsured and Underinsured Motorist Coverage
Despite auto insurance being mandatory in nearly every state, some motorists drive without it. If you are caught up in an accident with such a driver, uninsured-underinsured motorist coverage can help insure you for damage and injuries you have as a result of the accident.
Additional Towing Insurance For Your Business
The main reason for purchasing a tow truck insurance policy is for the specialized coverages the insurance companies provide. Tow truck insurance comes with a number of types of insurance that can help protect tow trucks specifically.
Some additional coverages on the market your tow truck insurance policy should have include:
Hired & Non-Owned Liability
This type of insurance provides coverage for employees who either use their own vehicle or motor truck for the job or utilize trucks the business rents. It will help pay for liability if either type of truck gets into an accident while conducting business.
On-Hook Towing Insurance
This tow truck insurance coverage is designed specifically for tow truck companies. On-hook insurance will pay for repairs or replacement to vehicles you are towing if they are damaged in transit by any hazards. Hence the “on-hook” part in the title. It usually covers damage caused by collision, fire, and theft. But keep in mind that it will not cover the property inside the towed vehicle.
Garagekeepers Legal Liability Coverage
This add-on tow truck insurance policy protects the business in the event that there is damage and theft to a towed vehicle that is being stored in your garage. This type of vehicle insurance covers repair expenses and replacement costs.
Cargo insurance is key to keeping items in a towed vehicle safe. This type of property insurance will provide coverage if items in your customer’s car are damaged or stolen while under your care.
This is especially important to keep your employees safe. If something happens while they are on the job, workers compensation will pay for medical expenses and provide them with a reduced salary while they are recovering. This can be an important part of the employee benefits you provide to your workers.
Tow Truck Insurance Costs
The most recent national average price for tow truck insurance was around $4,500 annually. That price is about $375 per month for coverage.
However, like any other type of insurance premium, what you end up paying can easily be above or below this baseline. Understanding that there are a number of factors that tow truck insurance providers take into consideration when establishing your premiums. Both you and your business will come into consideration for any type of commercial tow truck insurance.
Some variables that will affect your tow truck insurance rates include:
- Location - Where your business operates will impact your rates. If your commercial truck services cities rather than suburban areas, your rates will be higher.
- Usage - How often you tow and what type of cars you are towing will determine your rates. If you provide 24-hour towing and frequently are in charge of very expensive cars, your premiums are going to be significantly high.
- Driving records - Both you and your employees will have their driving records examined. If they find a long history of accidents and claims, your rates will be higher. It’s a good practice only to hire people with good driving records.
- Source of income - If your company’s sole purpose is to tow cars, then your rates will be higher than another company that just does it occasionally.
- The number of tow trucks - How many tow trucks you have and their safety features will determine your rates. The more trucks your tow truck company has, the more you will be paying.
- Experience - Being new to the tow truck industry will raise your rates. You have less experience, which means insurers do not know how you will act on the road. They have no choice but to prepare for the worst.
Tow Truck Commercial Insurance vs. Personal Auto Insurance
You cannot go about adding your tow truck to your existing personal auto insurance policy. While it may seem like you can just get the same types of coverage with a personal car insurance policy, tow truck insurance has a variety of truck-specific coverages that are necessary in order to successfully run your business.
Your tow truck generates income meaning a personal policy will have trouble providing the proper assistance you need following an accident. Commercial tow truck insurance policies also tend to offer higher coverage limits, something that personal insurance cannot do.
Get a Tow Truck Insurance Quote Today
Looking for a tow truck insurance policy? Contact us today to get a free tow truck insurance quote and save money on your policy. Our Customer care agents are standing by to answer any questions you may have.
Make sure you let us know your zip code, details of your business, and information on your tow truck(s). By providing us with all this, we can get a better idea of the coverage you need.
Quotes are available either at one of our many locations or online in just a few clicks via our website and mobile app. We are also just one call away. Get your tow trucks insured today and drive worry-free tomorrow.