Tow Truck Insurance 101: What’s the Difference Between On-Hook and Garagekeepers Insurance?

Hey guys, Jim here again. If you run a tow truck business in New York or New Jersey, you’ve probably heard people talk about on-hook and garagekeepers insurance. When I first started out, I thought they were the same thing. Turns out, they’re completely different — and mixing them up could cost you big time if something goes wrong.

Let me explain it the way my broker finally explained it to me.

On-hook coverage protects vehicles while you’re towing them.
Let’s say I’m hauling a customer’s car down the BQE and another driver cuts me off. I slam on the brakes, and the car I’m towing swings and gets damaged. That’s when on-hook coverage kicks in. It pays to repair or replace that customer’s vehicle while it’s in transit — basically, anytime it’s attached to your truck.

Now, garagekeepers insurance comes into play when the vehicle is off the truck and in your care — like parked in your yard, storage lot, or shop. So if I drop a car off at my lot overnight and it gets stolen, vandalized, or damaged in a fire, garagekeepers is what covers that loss.

Here’s the simple way to remember it:

• On-hook = covers vehicles while towing

• Garagekeepers = covers vehicles while stored

I’ve met plenty of tow truck owners who only had one of these and thought they were covered for both situations. That’s a dangerous mistake. If you store cars even for a few hours, you’ll want garagekeepers too. Many insurance companies can bundle both together so you’re fully protected no matter where the car is.

At the end of the day, both coverages are about one thing — protecting the customer’s car while it’s in your hands. Whether it’s hooked up to your truck or sitting in your lot, you don’t want to risk paying out of pocket for damages.

If you’re not sure whether your policy includes both on-hook and garagekeepers coverage, call The Sarrica Insurance Group at 516-277-0812. Or, fill out this quick form to get a quote: Get a Business Insurance Quote.

Trust me, it’s worth double-checking before something happens.

Tow Truck Insurance 101: How Much On-Hook Coverage Do I Really Need?

Hey folks, Jim here. When I first started my tow truck company in New York and New Jersey, one of the things that confused me most was on-hook coverage. I knew I needed it, but I had no idea how much was enough. Let me break it down in plain English for you.

On-hook coverage is what protects the vehicles you’re towing if they get damaged while hooked up to your truck. Without it, if a customer’s car gets scratched, dented, or worse while in your care, you’re on the hook (no pun intended) for the repairs.

A lot of tow truck drivers start with $25,000 in coverage because it’s the baseline most brokers recommend. That’s fine if you’re mostly moving older or lower-value vehicles. But here’s the thing — in New York and New Jersey, you never know what you’re going to be towing. One day it’s a beat-up sedan, the next it’s a luxury SUV worth $80,000. If that car gets damaged and you only carry $25K, you’re stuck paying the difference out of pocket.

That’s why I personally bumped my on-hook coverage up. $50,000 is a solid middle ground, and $100,000 is even better if you’re regularly towing high-end cars or working with dealerships. Some contracts and motor clubs even require higher limits before they’ll give you work.

So here’s my rule of thumb:

• $25K if you’re just starting out and mostly towing lower-value vehicles

• $50K if you’re in areas where you’re likely to see newer or higher-value cars

• $100K if you want to cover luxury vehicles and qualify for bigger contracts

At the end of the day, it’s about protecting yourself. The last thing you want is to lose a customer or your business over a gap in coverage.

If you’re not sure how much on-hook coverage makes sense for your tow truck company, call The Sarrica Insurance Group at 516-277-0812. Or, if you’d rather do it online, fill out this quick form: Get a Business Insurance Quote.

Trust me, it’s better to have the right coverage up front than to find out the hard way you didn’t.

Tow Truck Insurance 101: How Do Accidents or Claims Affect My Premiums?

Hey guys, Jim here. Running a tow truck business in New York and New Jersey isn’t always smooth sailing. Accidents happen. Maybe a fender-bender while you’re backing into a tight spot, or a customer’s car gets a scratch while it’s hooked up. The question most of us worry about is: how does that claim affect my insurance premiums?

When I filed my first claim, I thought the company would just pay it and move on. But what I learned is that every claim goes into your loss history. Insurance companies look at that history when it’s time to renew your policy. The more claims you have, the riskier you look in their eyes — and the higher your premiums can go.

Now, it doesn’t mean one accident will destroy your business. A small claim might not move the needle much, especially if you’ve been loss-free for years. But multiple claims in a short time, or big payouts, will definitely cause a spike. In some cases, too many losses can even make it tough to find a carrier willing to insure you.

Here’s what I’ve learned to keep my rates in check:

• Report only what you need to. Don’t file tiny claims for something you could pay out of pocket. It’s not worth putting a $500 ding on your record if it leads to thousands in higher premiums later.

• Focus on safety. Training your drivers, keeping your trucks in good shape, and using safety equipment go a long way in preventing accidents.

• Work with a good broker. Mine helps me shop around at renewal if one company wants to jack up the rates. Sometimes another carrier will look more favorably at my history.

The bottom line is this: accidents and claims do affect your premiums, but how much depends on your history, the size of the claim, and how you manage risk moving forward.

If you’re running a tow truck company like me and want to make sure your insurance is set up right — and that you’ve got a plan for keeping premiums under control — give The Sarrica Insurance Group a call at 516-277-0812. Or, fill out this quick form: Get a Business Insurance Quote.

Trust me, staying on top of your insurance now will save you headaches (and money) later.

Tow Truck Insurance 101: If I Hire Extra Drivers, Are They Covered?

Hey guys, Jim here again. Running a tow truck business in New York and New Jersey, I learned early on that sometimes you just can’t do it all by yourself. You get busy, calls start coming in back-to-back, and the next thing you know you’re thinking about hiring a part-time driver to help keep things moving. But then the big question hits: if I bring someone on, are they actually covered under my insurance?

When I first asked my broker, I was surprised by the answer. The short version is: not always.

Here’s how it works. Most commercial auto policies will cover “permissive drivers” — that means if you give someone permission to use your truck, they’re insured. But that only really applies if it’s occasional use, like if a buddy helps you out one weekend. If you’ve got someone driving for you regularly, especially if you’re paying them, the insurance company wants that driver listed on your policy.

And here’s the tricky part: insurance companies care a lot about who’s behind the wheel. They’ll ask for driver information, including license numbers and driving history, and sometimes they’ll even deny a driver if the record is too rough. That’s why I always check with my broker before putting anyone new in the seat.

Another thing a lot of guys overlook is workers comp. If you’ve got employees — even part-time — the state might require you to carry workers compensation insurance. That way if one of your drivers gets hurt on the job, you’re not paying out of pocket. In New York and New Jersey, they don’t mess around with that.

So here’s what I do: anytime I’m thinking about hiring or even letting someone help out, I call my broker first. I’d rather deal with the paperwork now than deal with a denied claim later.

If you’re running your own tow truck company like me and you’re not sure if your drivers are covered, don’t leave it to chance. Give The Sarrica Insurance Group a call at 516-277-0812. Or, if it’s easier, just fill out this quick form: Get a Business Insurance Quote.

Trust me, it’s worth making sure you and your drivers are fully protected.

Tow Truck Insurance in NY & NJ: What Coverage Do You Really Need?

Hey folks, Jim here. I run my own tow truck company across New York and New Jersey, and one of the first things I had to figure out was what insurance I actually needed to stay legal. It can get confusing, so let me break it down the way I wish someone had explained it to me when I was starting out.

The basics – liability insurance

Both New York and New Jersey require tow trucks to carry commercial auto liability insurance. This is what covers injuries or damage if I, or one of my drivers, cause an accident while on the road.

The minimum limits vary, but here’s the simple version:

• If you’re towing cars across state lines, the federal DOT requires at least $750,000 in liability coverage.

• Many jobs and contracts in NY and NJ won’t even look at you unless you carry $1 million in liability.

I went with the higher limit because it opens up more work opportunities and gives me peace of mind.

On-hook coverage

This one’s big for tow truck owners. Liability covers accidents, but it doesn’t pay if the vehicle I’m towing gets damaged. That’s where on-hook coverage comes in. I carry at least $25,000, but depending on the cars you tow (think high-end or luxury vehicles), you might want $50,000 or even $100,000.

Garage liability and garagekeepers insurance

If you’ve got a yard or a lot where you keep towed vehicles, you’ll want to look into two more things:

• Garage liability, which covers accidents that happen on your business property.

• Garagekeepers insurance, which covers customer vehicles while they’re in your possession.

State and federal filings

Since I run across state lines, I also had to make sure my broker handled the FMCSA filings like the MCS-90, and state filings such as the Form E. Without these, you’re technically not compliant, even if you already have a policy.

So, the short answer is this: to run legally in New York and New Jersey, you’ll need commercial auto liability (preferably $1 million), on-hook coverage (at least $25,000, but more if you tow expensive cars), garage liability and garagekeepers insurance if you store vehicles, and the right state and federal filings.

When I first started, I thought insurance was just another bill. Now I see it as the thing that keeps my business alive if something goes wrong.

If you’re a tow truck owner like me and need help setting this up, give The Sarrica Insurance Group a call at 516-277-0812. Or, if you’d rather do it online, just fill out this quick form: Get a Business Insurance Quote.