Tow truck operators perform valuable services, especially when motorists break down at the side of the road or become stranded in severe weather. Operators of these vehicles face unique risks in the commercial transportation industry; the tow truck and business assets as well as the property of others can incur expensive losses. Tow truck insurance is needed to protect against these risks. In this guide, we will explore the essential coverages tow truck operators need to protect themselves, their businesses, and their customers’ property.
Unique Risks in the Towing Industry
Towing is an essential part of the commercial transportation sector. Tow trucks and their operators may be called upon to rescue stranded motorists, bring vehicles to repair centers, or transport vehicles and heavy equipment from jobsite to jobsite. Each of these tasks presents unique risks. Beside dedicated tow truck businesses, other companies that may operate tow trucks include:
- Repair and maintenance firms
- Repossession companies
- Vintage/collectible vehicles transporters
When considering tow truck insurance, it is important to consider the broad range of potential risks facing operators. The tow trucks and the towing companies’ assets are only some of the risk exposures. Others include the vehicles being towed or transported and the vehicles that may be stored on company premises while they are being repaired.
Essential Tow Truck Insurance Coverages
Business owners rely on the protection of commercial insurance to provide coverage against operational and liability risks. Tow truck operators generally carry some form of general liability insurance, but there are other essential coverages that help to protect business assets from losses.
Most tow truck insurance plans cover risks very similarly to the risks covered by automotive or commercial vehicle insurance. These coverages typically include:
Auto liability insurance – covers damage that your truck or operator causes to others.
Physical damages insurance – covers damage or loss of a tow truck operator’s vehicle.
Uninsured motorists’ insurance – covers damages or losses from motorists with insufficient or nonexistent insurance coverage of their own.
Medical payments insurance – covers medical expenses for operators and passengers injured in an accident.
As tow truck operators, you may have employees that also need insurance protection. Most states require workers’ compensation insurance for businesses that employ others. Even if state law does not require workers’ comp, it is a smart move to purchase this coverage, as an employee injury can result in steep medical and rehabilitation expenses if paid out of pocket.
Two specialized tow truck insurance coverages are also recommended. These are garagekeepers insurance and on-hook towing insurance. Garagekeepers insurance is essential for the tow truck operations that may store vehicles on business premises, such as repair facilities with tow trucks of their own. If something were to happen to a client’s car when stored on the premises, a business could face steep expenses. On-hook (sometimes referred to as “in-tow” insurance) provides valuable coverage for the vehicles as they are being transported by the tow truck company. If an accident or natural disaster were to strike, damaged or lost client vehicles can result in significant risk exposures and the expenses associated with repair or replacement. On-hook coverage manages those risks and protects the business from financial losses.
Finally, many companies can benefit from a tow truck insurance policy that includes excess liability or umbrella coverage. Excess liability takes over when the company’s other policy limits are exhausted, such as in situations where expensive claims above the amount of existing coverage take place. Excess liability insurance for tow truck operators is a security blanket, providing protection to supplement other insurance coverages. With the right tow truck insurance coverages and the right risk management plans, tow truck operators can continue to provide essential vehicle hauling services without the worry of expensive claims that could otherwise disrupt business operations.
About Western Truck Insurance Services
Western Truck Insurance Services is a commercial truck insurance agency with roots dating back to 1954. We have evolved into a highly respected, professionally managed, truck and transportation insurance brokerage. The hallmark of our organization is our desire to provide unparalleled service. We go way beyond what you expect to receive from an insurance brokerage. Equipped with state of the art automation, Western Truck Insurance can provide you with lightning fast truck insurance quotes, customer service, Insurance certificates, and coverage changes. Contact us today at (800) 937-8785 to learn more!