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Navigating Insurance Requirements for Tow Truck Operators

Navigating Insurance Requirements for Tow Truck Operators

Trucking Insurance

Tow truck operators play a vital role in helping stranded motorists and moving vehicles when things go awry.

Their line of work comes with a unique set of risks, making the need for comprehensive tow truck insurance essential. We'll discuss the coverages tow truck operators require to safeguard their business, assets, and their clients' property. At LuckyTruck, our expert brokers in insurance and our cutting-edge digital app can steer you to reliable insurance solution for all your insurance needs. - GET A QUOTE TODAY.

The Unique Risks in the Towing Industry

Towing is a critical component of the commercial transportation sector. Tow trucks and their operators are called upon to rescue stranded motorists, transport vehicles to repair centers, and move vehicles and heavy equipment from one location to another. Each of these tasks presents its own unique set of risks. Besides dedicated tow truck businesses, other entities that may operate tow trucks include:

  • Repair and maintenance firms

  • Repossession companies

  • Dealerships

  • Vintage/collectible vehicle transporters

When considering tow truck insurance, it's essential to take into account the broad range of potential risks that operators face. These risks include the tow trucks and the assets as well as the vehicles being towed, transported, or stored.

Essential Tow Truck Insurance Coverages

The towing industry relies on commercial insurance to protect against operational and liability risks. While most tow truck operators carry some form of general liability insurance, several other crucial coverages help safeguard business assets against losses. Coverages usually include:

Auto Liability Insurance

This covers damage caused by your tow truck or operator to others.

Physical Damages Insurance

Protects against damage or loss of a tow truck operator's vehicle.

Uninsured Motorists Insurance

Provides coverage for damages or losses incurred due to motorists with inadequate or nonexistent insurance coverage.

Tow truck operators may employ workers who also need insurance protection. In many states, businesses with employees are legally required to carry workers' compensation and occupational accident insurance. Even if not mandated by state law, obtaining workers' comp is a wise choice, as employee injuries can result in substantial medical and rehabilitation expenses if not covered by insurance.

Two specialized tow truck insurance coverages that are highly recommended are garagekeepers insurance and on-hook towing insurance.

Garagekeepers insurance

Garagekeepers insurance is vital for tow truck operations that store vehicles on their premises, such as repair facilities with tow trucks. If an incident were to occur while a client's car is on the premises, the business could face significant expenses.

On-hook (sometimes referred to as “in-tow” insurance)

This insurance offers coverage for vehicles being transported by the tow truck company. In case of an accident or natural disaster, damaged or lost client vehicles could expose the business to financial losses related to repair or replacement. On-hook coverage effectively manages these risks and shields the business from such expenses.

Other insurance considerations

Many companies can benefit from a tow truck insurance policy that includes excess liability or umbrella coverage. Excess liability insurance kicks in when the company's existing policy limits are exhausted, providing supplemental protection for costly claims that exceed the amount of available coverage. It serves as a safety net, offering peace of mind by supplementing other insurance coverages.


With the right tow truck insurance in place, operators can continue to provide essential towing services without the fear of expensive claims that could disrupt their operations.

LuckyTruck is an expert in transportation insurance and can help tow truck drivers get the right insurance for their needs - GET A QUOTE TODAY.