Why Towing Insurance Is Different
Towing and roadside assistance is a completely separate insurance class from trucking or general transportation. When you tow a vehicle, you take on legal responsibility for that vehicle — which means you need specialized coverage that standard commercial auto policies simply don't provide.
Whether you run one wrecker truck or a full fleet with roadside assistance, repossession, and storage yard operations, we work with carriers who specialize in the towing industry to make sure you're properly covered at the right price.
Coverage We Offer for Towing Companies
- Garagekeepers Legal Liability — covers damage to customers' vehicles while in your care, custody, or control — at your lot, on the hook, or in storage
- On-Hook Towing Coverage — covers the vehicle you're actively towing if it's damaged during transport. Carriers ask for your highest on-hook limit — make sure yours matches the vehicles you tow
- Commercial Auto Liability — covers bodily injury and property damage caused by your tow trucks and service vehicles while operating on the road
- Physical Damage — comprehensive and collision coverage for your tow trucks, wreckers, flatbeds, and service vehicles
- General Liability — covers third-party bodily injury and property damage at your premises or during operations not covered by your auto policy
- Workers Compensation — required by Illinois law for towing companies with employees; covers medical bills and lost wages for injured drivers and yard workers
- Garage Liability — if you perform any mechanical work, tire service, or other auto services at your facility
- Repossession Coverage — specialized liability for voluntary and involuntary repossession operations — not all carriers will write this
- Commercial Umbrella — additional liability protection above your primary limits, often required by police and motor club contracts
Towing vs. Roadside Assistance — What's the Difference?
These are two distinct operations with different insurance needs:
- Towing companies — primary exposure is on-hook and garagekeepers. You're physically moving vehicles and storing them, which creates significant liability for damage to the towed vehicle
- Roadside assistance only — jump starts, lockouts, fuel delivery, tire changes — lower exposure than full towing. You may not need on-hook coverage if you never tow, but you still need commercial auto and GL
- Both operations — if you do both towing and roadside, carriers will rate the full exposure including on-hook limits, storage capacity, and the types of vehicles you service
Repossession Insurance — A Separate Category
If any portion of your business involves vehicle repossession — voluntary or involuntary — you need to disclose this to your carrier. Many standard towing carriers exclude repossession operations entirely. We work with specialty markets that write repo exposure and can structure the right coverage for mixed-operation towing companies.
Key questions carriers ask about repossession: how many repos per month, voluntary vs. involuntary split, and whether you use skip tracing services. Having accurate answers ready speeds up the quoting process significantly.
What Carriers Ask When Quoting Towing Insurance
Before we go to market on your behalf, we'll collect the following information — having it ready gets you a faster, more accurate quote:
- Number of tow trucks / wreckers / service vehicles and their values
- Types of vehicles towed — light duty, medium duty, heavy duty
- Highest single vehicle value you expect to have on hook at any time
- Storage yard capacity and security (fenced, lit, gated, alarm)
- Whether you do repossession and approximate monthly volume
- Annual gross receipts broken down by operation type
- Number of drivers, their CDL status, and MVR history
- Motor club contracts (AAA, Agero, Allstate Motor Club, etc.)
- Police towing contracts — these often require specific liability limits
- Radius of operation — local, regional, or statewide
- Prior loss history — 3 to 5 years
Motor Club & Police Towing Contracts
If you hold contracts with AAA, Agero, Allstate Motor Club, or a local municipality for police towing, your insurance requirements are typically higher than standard. Most motor club contracts require minimum liability limits of $1,000,000 CSL and specific garagekeepers limits. We'll make sure your policy meets your contract requirements so you don't risk losing the contract over an insurance gap.
Tow Truck Insurance Requirements by State
We write tow truck insurance in Illinois, Wisconsin, Indiana, Iowa, and Michigan. Each state has its own minimum liability requirements for commercial tow trucks, and requirements vary further based on whether you operate under state commerce commission authority or interstate commerce rules.
- Illinois — ICC authority requirements apply for intrastate operators. Minimum liability varies by vehicle class. Impound operators often face additional municipal requirements.
- Wisconsin — Wisconsin DOT requirements apply. Motor club contracts typically require $1M CSL minimum regardless of state minimums.
- Indiana — INDOT requirements for commercial tow vehicles. Repossession operators need to be aware of Indiana repo licensing requirements.
- Iowa & Michigan — State-specific minimums apply. We'll confirm your policy meets requirements in every state you operate in.
If you cross state lines regularly, interstate commerce requirements may apply and we'll make sure your policy is structured correctly for multi-state operations.