The Basics of Commercial Tow Truck Insurance

Towing company owners may be one of the biggest unsung heroes of our community: they take on risks from every angle to help people get out of precarious situations and move on with their days. Think about it: your company, employees, and reputation are vulnerable to damages, losses, fraud, and injuries or death. Thankfully, there are ways to mitigate your risks, including regular employee training, proper maintenance of your facilities and fleet, and investing in high-quality equipment. This article examines yet another protection against losses: commercial tow truck insurance. Understanding commercial tow truck insurance types is vital to protecting you against potential financial losses.

Four Key Components of Commercial Tow Truck Insurance

General Liability Insurance

General liability insurance covers situations where a claim has been made against your business, and you are found legally responsible for the claimant’s bodily injury, personal injury, or property damage. This type of insurance doesn’t cover damages or injuries to your fleet or your employees–only the claimant’s. For example, if your company is sued for breaking the axle of a vehicle you towed, your general liability insurance may cover it. In the United States, most states require general liability insurance as part of their business licensing requirements.

Collision Coverage

Collision coverage applies to damages to your fleet vehicles incurred from a collision. Whether your tow truck driver is involved in a motor vehicle accident with another car or accidentally backs into a pole, this insurance will help to cover the repair or replacement costs.

Medical Payments Insurance

This insurance is critical to cover the costs incurred for bodily injury or death of your employees and their passengers as the result of an accident. These plans generally cover medical care, hospitalization, rehabilitation, and funeral expenses.

Uninsured Motorist Insurance

Too many drivers on the road do not cover sufficient liability insurance in the event they cause an accident.   Uninsured (or underinsured) motorist insurance protects you if another party is found liable for damage to your fleet or your employees, but they have insufficient insurance to cover the expenses.

Other Types of Critical Insurance for Towing Companies

Two types of insurance protect damages or losses to your customers’ vehicles while in your care. One covers damage while parked on or within your property, the other while being towed.

Garage Keepers Legal Liability Insurance

Many towing companies store their customers’ vehicles in a garage or parking lot. Garage keepers insurance protects you against financial losses in the event of physical damage to the vehicle from fire, collision, theft, or vandalism. For example, if a customer’s car is stored in your lot and someone breaks into it, this insurance would cover damages and losses.

On-Hook Towing Insurance

On-hook towing insurance is essential to cover losses associated with damage to a vehicle your driver is towing. For example, if your driver is towing a car and accidentally clips it while making a sharp turn, this insurance would cover damage to the vehicle “on-hook.”

Just one more thing…

When it comes to high-quality towing equipment, choose Collins.