Like many industries, tow truck operators have very specific insurance needs. To protect your towing business, it is important you understand tow truck insurance coverage basics including the specialized policies you need. Here are 3 types of insurance coverage important for towing service operators:
On-Hook Coverage and Cargo Coverage
While technically these are two different types of coverage, they are related. Both deal with the property of others that you are transporting or towing. In the case of on-hook coverage, that property is the vehicle(s) that you are towing. On-hook coverage pays for damage to the customer vehicle while in-tow or while loading or unloading.
Most towing service operators are familiar with on-hook coverage and understand why it is important. What about other property, such as the contents of the customer’s vehicle? Those items are considered “cargo” and are not covered by most on-hook coverage forms. When shopping for tow truck insurance, discuss with your agent whether the on-hook coverage includes coverage for cargo.
Garage Keepers Liability
In most states, garage keepers liability is a companion coverage to on-hook coverage. If you store vehicles for customers at your location then garage keepers coverage deals with damage claims for things like fire, theft, vandalism, and even collision damage.
An important sidenote: in Texas and Virginia, on-hook coverage is called garage keepers insurance and “storage location insurance” is the equivalent of garage keepers coverage. Why? We have no idea…
Related Article: What is garage keepers liability?
General Liability Insurance
General liability is a foundational coverage for many business insurance policies. If your towing business occupies an office or has a storage lot, general liability can protect the premises from bodily injury claims. There are certain off-premise claims that may also be covered by general liability insurance. Many tow truck operators do not purchase general liability coverage but it might be important for your operation.
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Tow Truck Insurance Coverage Basics
This is just a brief summary of some of the many types of insurance coverage available to a towing operation. If you have questions about what type of tow truck insurance is applicable to your business, contact our office today. Our tow truck insurance specialist, Stephanie Schindel, can answer your questions and provide you with a no obligation towing services insurance quote.
Safeguard Insurance is licensed to quote tow truck insurance in Nevada, Utah, Arizona, and California