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.