Understanding Tow Truck Insurance
Driving a tow truck is a dangerous profession, often requiring operators to work on busy streets and in poor weather conditions while transporting heavy vehicles. These risks make it essential to have the appropriate tow truck insurance to safeguard your business from lawsuits and to protect against damages to your truck as well as the vehicles you tow.
What is Tow Truck Insurance?
Tow truck insurance generally involves commercial truck insurance that provides specialized protection against damage to the vehicles you tow, whether they are on your truck or parked at your business. Additionally, towing business owners may require other forms of insurance, such as general liability, workers’ compensation, and commercial property insurance.
Types of Tow Truck Insurance
Here are the key types of tow truck insurance and their coverages:
- Auto Liability Insurance: Covers costs related to bodily injury or property damage if you’re at fault in an accident and includes legal defense fees if you’re sued.
- Collision Insurance: Provides coverage for repairs or replacement of your tow truck if it is damaged in an accident.
- Comprehensive Coverage: Covers repairs or replacement for your tow truck in non-collision incidents such as theft, fire, or damage from falling objects.
- Medical Payments Coverage: Pays for medical expenses for yourself and passengers injured in an accident, including customers in your truck.
- On-Hook Coverage: Also known as garage keepers legal liability insurance in Texas and Virginia, covers vehicles damaged while attached to your tow truck.
- Garage Keepers Legal Liability Insurance: Covers damages to vehicles under your care while being stored or serviced.
- Uninsured Motorist Insurance: Covers injuries to you or your passenger from accidents caused by uninsured drivers or hit-and-run incidents.
Tow Truck Insurance Requirements
Federal regulations mandate that all tow truck operators must have auto liability insurance, although minimum coverage limits can vary by state. Some states also require medical payments coverage. If you employ others, you’ll likely need workers’ compensation insurance, which addresses medical costs for workplace injuries and protects against lawsuits—this is generally required if you have one or more employees.
Cost of Tow Truck Insurance
According to Progressive, the average monthly premium for tow truck insurance was $448 in 2020, although your actual costs may differ. Factors such as your location, driving history, and the nature of your towing services will influence your rates. Furthermore, choosing higher deductibles or paying for the entire annual premium upfront can help lower your insurance costs.
Top Tow Truck Insurance Providers
Progressive: A trusted provider for commercial truck services, Progressive offers a wide variety of coverage options for towing businesses, allowing quotes to be obtained online or via phone.
Geico: Provides insurance for both individual tow vehicles and fleets, with quotes available by phone. Geico allows claims to be processed online or through its mobile app, and opportunities exist to bundle tow truck coverage with other insurances.
Prime Property & Casualty Insurance: Offers tailored coverage for tow truck drivers, including those with a history of accidents. However, this company limits its services to 10 states.
