Why have tow truck insurance rates been going up?

If you’re in the towing game, you probably think you’re paying a lot for your tow truck insurance. And you’re right – chances are you’re paying quite a bit for your coverage. However, the recent increase in truck insurance rates isn’t because the carriers are out to get you, and it’s probably not a direct result of anything you did. There are many reasons for the increase, and the truth is that it’s not just towing businesses who have been noticing this trend. Rates for commercial auto insurance in many industries have been skyrocketing.


We’ll explain.

Why have tow truck insurance rates increased?

1. Bodily injury litigation expenses have gone up.

The cost of bodily injury litigation following car accidents, especially those involving commercial vehicles, has gone up, which is one reason that auto liability insurance is so essential. That means that the potential for a very large insurance claim has gotten bigger…and tow truck insurance rates have increased right along with it. Insurance companies are all about statistics and probability.

2. The cost of medical expenses has gone up.

If you or one of your drivers causes a crash and injures the other driver, odds are it won’t be just a bump or scrape. They could have lasting, severe injuries that take time to heal. Those medical expenses add up quickly, which means that the cost of a potential claim has also risen. So, that’s another reason rates have gone up.

3. Reckless driving behaviors increase the frequency and severity of accidents.

Distracted driving remains a major problem nationwide. Texting while driving increases the chances of an accident, as sending or reading a text can take your attention off the road for almost five seconds.

Here’s the thing:

A vehicle traveling 50 mph can easily travel the length of a football field in that time.

If the distracted driver who causes an accident happens to be operating a CMV…well, that’s not good. The chances of a major claim due to distracted driving are significant when you consider the litigation and medical expenses the towing business is obligated to pay.

We can help you save on your tow truck insurance.

Now, distracted driving isn’t the only risky behavior that’s problematic. Speeding or driving too fast for road conditions are also dangerous – speeding can increase the severity of an accident if one occurs. And the worse an accident is…well, you get where we’re going. The fact is that the road is a dangerous place.

4. People are driving – a lot.

According to an NPR article, the last few years have marked the most miles ever driven in the U.S. With lower gas prices and lower unemployment rates, more people are on the roads trying to get where they need to go. And more drivers on the road means more car accidents, something that towing businesses aren’t immune to.

5. Vehicles are more expensive.

Technology is great…right?

The only thing is that since more vehicles are “high-tech,” they’re also more expensive to repair. Even a minor accident can mean some serious repair bills if the vehicle is equipped with the latest and greatest tricks. And again, those expenses get added to the insurance claim. As our trend goes, the higher the potential cost and the increased likeliness of a claim means higher rates.

So, how can a towing business manage the costs of tow truck insurance?

The situation isn’t quite as bleak as it may seem. There are a few steps you can take to keep your tow truck insurance rates down.

  • Have a thorough hiring process and hire the best drivers.
  • Invest in driver training.
  • Commit to safety by holding safety meetings.
  • Implement workplace policies about distracted driving, speeding, following distance, etc.
  • Try not to file minor claims.
  • Identify and manage your risks.
  • Consider using GPS or telematics to monitor speed, route, braking, etc.
  • Maintain your tow trucks.

Taking steps to make your business safer can help you avoid claims, which in turn can help you keep a clean loss record. And the cleaner your loss record, the better your insurance situation and the lower your rates. So, seek out ways to make your business safer. Strike up a conversation with your agent and ask if they have any advice to help you mitigate your risk.

So, that’s the story about tow truck insurance rates. It’s not that the insurance companies are out to get tow truck businesses. It’s just that they’re looking at all these factors that make the cost of a potential claim very high. They’re looking at statistics and probability.

We can help you save on your tow truck insurance.

Anyways, hang in there. We can help you shop around for the best coverage out the best price. Though tow truck insurance rates have been increasing, we remain undaunted in our mission to help towing and wrecker operations save money on their insurance. To get in touch with us, just fill out our quote form or give us a call today.


Jackson, Tim. “The Rising Cost of Tow Truck Insurance.” Tow Times, Feb. 2018, pp.



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