How Much Does On-Hook Insurance Cost?

As a tow truck driver, you have to understand that the role comes with a lot of risks. Not only is it your job to safely transport the client’s vehicle, but you’re also responsible for protecting your towing business. In other words, you need insurance to protect your business from any unforeseen expenses due to an accident or other mishap.

Investing in on-hook insurance is one way to protect your business financially. You may be wondering what on-hook insurance is and how much it costs.

In this article, we’ll discuss on-hook insurance and how to find affordable coverage for your towing business.

On-Hook Insurance Cost

On-hook insurance is a necessity in the towing industry and some states may require it. This coverage protects towing businesses if a client’s car is damaged under their care. Since a lot of unforeseen incidents occur out there on the road, you can never be too careful.

Oftentimes this type of insurance is bundled with your auto liability policy. It also makes up a significant portion of your overall insurance costs.

If you’re a tow truck owner, you can expect to pay between $350 and $800 monthly for your commercial auto insurance. This cost includes on-hook coverage.

Different factors that affect the cost of on-hook insurance are:

  • The nature of your business
  • The number of tow trucks you own
  • Type and condition of your tow trucks
  • The age and experience of your drivers
  • Your hauling radius 
  • Claims 
  • Accidents 
  • DUIs
  • Speeding tickets
  • How long you’ve been in business

 How to Find Affordable On-Hook Insurance

As you can imagine, spending between $350 and $800 a month can be a large burden on your finances. Luckily, there are ways you can save money on your on-hook insurance.

First things first, you need to find an agent that specializes in commercial auto insurance. Of course not all commercial businesses are alike; therefore, you want someone with a deep understanding of the towing industry.

An agent that understands the industry knows the risks you encounter every day, so they’ll be able to better assist you.

By seeking assistance from an agent, you’ll be able to get multiple quotes from several different carriers. It’s important to weigh all your options and see what coverage plan is right for you and your towing business.

How Do Limits and Deductibles Work?

A major factor that affects the cost of your towing insurance is the limit you choose. The limit for on-hook insurance ranges between $10,000 and $250,000. If you choose a lower limit then you’ll pay less in premiums. Ultimately, the limit you choose should be based on the value of the vehicles you tow.

That means if your business tows low-valued vehicles then a $10,000 limit may be enough for you. However, most choose something a little higher to be on the safe side. Furthermore, if your limit is too low then you could be stuck footing the rest of the bill.

Your deductible will also affect the cost of your on-hook insurance. Most deductibles are set to $500 but you have the option to increase it to $1,000 or more. The higher the deductible, the less money you pay in premiums. However, you should always choose an amount you’re comfortable paying. Keep in mind if a claim is filed then you’ll have to pay the agreed amount upfront. So, if you file a lot of claims it may not be wise to up your deductible.




We can help you save on your tow truck insurance.





On-hook/In-tow Coverage