On-Hook Towing Insurance

What is On-Hook Towing Insurance? and do I need it for my tow truck business?

Do I need insurance for towing? Does normal auto insurance cover tow? Can I tow a cargo legally on the road? If all these questions are hovering over your mind then on-hook towing insurance is what you need.

Learn everything about this coverage to get the most out of your investment!

As a tow truck operator, you hold the responsibility of keeping the on-hook cargo or vehicle safe. To cover the cost of damage followed by an accident, you need adequate on-hook towing insurance.

Towing session exposes the on-hook cargo to plentiful risks and dangers. No matter how precautious your drivers are on the road, towing operations are prone to hazards.

However, with towing insurance, you can mitigate the likely financial jeopardy that comes with such risks. If you take sufficient on-hook liability insurance, it would compensate for the vehicle loss that you suffer during the haul. 

Once you hook a vehicle, you are liable for its protection. Don’t think that a policy like general liability will offer the same level of protection as on-hook cargo insurance does. You need adequate on-hook towing insurance coverage to protect the entire hauling session.

What are the benefits of having on-hook towing insurance?

 If your business is engaged in providing towing services across states, investing in tow truck insurance can save your company from any financial strain and also keep your operations smoothly running. Here are its additional benefits:

  • Repair & replacement: You get covered for repairing and replacing the on-hook vehicle which gets damaged in an incident.
  • Medical expense: If someone gets injured in the process of towing or hooking the vehicle in the tow truck, this insurance coverage will compensate for the medical expenses of the injured person.
  • Lawsuit expenditure: If you get sued after causing damage to the on-hook vehicle on the road or in the process of hooking it to the tow truck, this insurance coverage pays for the legal expenditure.
  • Property damage: If any property gets damaged in the process of towing or hooking the vehicle and you get sued for it, this coverage pays for the legal expenses.

Start your on-hook towing insurance quote.

What does on-hook towing insurance cover?

On-hook towing insurance coverage protects your customer’s vehicle that gets damaged during the hauling session. The moment you hook a vehicle in your tow truck, you are entirely accountable for every damage that happens in the haul until it reaches its destination.

The damages can be minor such as scratches or dents, but sometimes it can go out of hand. In both scenarios, you are financially responsible for making things right which can range from repair to even replacement.

If you take adequate on-hook liability insurance, you get protected against:

  • Theft.
  • Vandalism.
  • Collision.
  • Explosion
  • Fire.

This coverage also covers the damages while hooking or unhooking the vehicle.

What is NOT covered?

On-hook towing coverage does not cover the following:

  • Damages to own vehicle (your tow truck) which you are using to move on hook cargo or vehicle.
  • Damages occurred to an unhooked vehicle.
  • Physical injuries happen to own tow truck drivers or passengers in an accident.

Why is there a need to take on-hook towing insurance?

Common auto liability insurance or even your existing tow truck insurance might not offer coverage for vehicles that belong to others. Therefore, if you provide towing services, you must carry on-hook towing coverage.

Without this policy, your towing business can face significant financial loss if your drivers damage your client’s vehicle. It is a better and financially smart decision to carry adequate commercial towing insurance.

Without this policy, your towing business can face significant financial loss if your drivers damage your client’s vehicle. It is a better and financially smart decision to carry adequate commercial towing insurance.

Therefore, if you own repair shops, service stations, auto-keeping warehouses, and body shops, you can take this coverage for protecting your client’s assets.

On-Hook Towing Insurance

Please note, this insurance requirement varies from state to state. You need to check what your state requisites are.

What is the cost of on-hook towing insurance?

Although there are several factors that affect on-hook towing insurance. But an average tow truck business owner is likely to pay between $350 to $800 every month.

Here are a few factors that determine your towing insurance cost such as:

  • The type of vehicle you tow (new, totaled, used, etc.)
  • The model and age of your tow truck.
  • The choice of deductible.
  • The location of your business and the radius you offer towing services.
  • The number of tow trucks you own.

Start your on-hook towing insurance quote.

How can you save money on your on-hook towing insurance?

Commercial towing insurance coverage is one of the biggest expenditures for any towing service provider. Even if you provide affordable roadside assistance to your clients, the cost of tow truck insurance per month can dig deeper into your pockets. However, every towing business requires sufficient on-hook towing coverage.

The major determiner of your on-hook towing coverage is the limit you will choose which falls between $10000 to $250000. Most towing businesses opt for higher limits due to the great risks involved in their operations.

The deductible is another biggest factor that decides your towing coverage cost. Most deductibles in this policy are set at $500. You can always increase it to $1000 or even higher to save a few dollars on your monthly or annual premiums.

Here are other methods that will help you save on your tow truck insurance cost:

  • Driving logs: If your drivers are working for extended hours without required breaks then it increases the rate of accidents on the road. The more claims you file, the higher will be your premiums. So, try maintaining a log of driving hours as this would help you save money on your coverage.
  • Competent drivers: Make sure you hire skilled drivers because they are the ones who are responsible for towing the cargo. Check their driving records, age, and experience in the field. Good driving records often help you save a few bucks on your towing premiums.
  • Truck maintenance: A well-maintained tow truck is likely to experience fewer damages in an accident than a non-kept one. This puts drivers and the towed cargo at low risk which helps in minimizing the cost of towing insurance.
  • Continuous training: Giving your drivers continuous training will ensure the safety of the on-hook cargo. A highly trained driver takes utmost precaution and makes fewer mistakes than a non-trained. Raising the safety feature in your tow trucking will help you lower the towing insurance rate.

If only cheap tow truck insurance is what you are looking for, accidents might cause damages that exceed your plan limit. Be mindful while buying this coverage because you should be reimbursed for the loss without draining your own funds.

Frequently Asked Questions

Who requires on-hook towing insurance?

Businesses and independent truckers who provide towing services and roadside assistance or own service stations, body shops, or repair stations need this insurance.

Does the garagekeepers insurance cover the on-hook vehicle?

No, garagekeepers insurance covers the insured against vehicle damage happening inside your facility and does not protect the on-hook vehicle. However, in Texas and Virginia, on-hook towing coverage is also known as garagekeepers legal liability coverage.

What things should you look for in on-hook towing coverage?

Owner-operators and independent truckers should consider the following coverages to protect the entire towing session.
Coverage: Review your commercial truck insurance and determine how much additional coverage you require.
Limit: The limit of your coverage should be based on the amount of risk your business faces.
Deductible: A higher deductible reduces the premium but increases the amount you would pay while claiming it. Lower deductibles raise your premium but lower your burden when you file the claim.

What is counted as on-hook cargo?

Any vehicle which is attached to your tow truck is counted as on-hook cargo. Your on-hook towing coverage will only protect the hauling session. If damage happens to an unhooked vehicle, you will either pay it out of your pocket or be covered by another policy (if taken).

What should your on-hook towing insurance cover?

You can customize your on-hook towing coverage and get your operations safe against all road risks. However, this policy should cover:
– The cost of repairing or replacing the on-hook vehicle.
– Damages caused by explosion, fire, theft, or vandalism.
– Collision.

How to get the appropriate on-hook towing insurance for my business?

If you want to give your towing business the best coverage, consider the following:
Customize your policy according to your needs.
Choose the limit and deductibles sensibly.
Pick a comfortable payment plan (monthly, quarterly, or yearly).
Take coverages that protect you against all road risks.

In what scenarios, on-hook towing coverage is not applicable?

On hook-towing coverage is not applicable if:
Vehicles which are transported are personal or owned by the business.
Towing cars, especially luxurious wheels for personal use.

Does an insurer pay for the towing?

Maybe yes or maybe not. Check your towing coverage policy, if it includes providing road assistance then you would get paid for it or vice-versa. You need to see how much distance is covered otherwise you would pay it from your own pockets.

Start your on-hook towing insurance quote.


On-hooking towing insurance is a beneficial cover for body shops, tow businesses, roadside assistance providers, and service stations. If you are one of them, allow us to help you customize your policy according to your risk exposure.

We will add a robust layer of protection to your towing operations that would give unfailing financial support when you need it the most.

Let us help you invest your money in the right on-hook towing insurance plan!

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