Written by: Caleb Jackson, Transportation Risk Insurance Professional with Barbee Jackson Insurance. Texas has its own set of regulations that tow operators must inherit in order to operate. Below is a full breakdown of the regulation and insurance options your business needs to succeed.

Towing Insurance made easy

If you are looking for the best way to insure your tow operation and meet Texas’s strict guidelines then look no further than Barbee Jackson Insurance. Since 2009, Barbee Jackson Insurance has been working with tow businesses to properly insure their operations while providing regulatory guidance so our business owners get that right insurance at the best price. Call today to get started (850) 389-2001 (Spanish speaking agents are available)

Texas Insurance Requirements for Tow Truck Businesses

Unlike most commercial trucking in Texas, tow operations are not governed by the TxDMV. All tow operations are governed by Texas Departments of Licensing and Regulations (TDLR). There are three (3) categories of tow risks with each having their own insurance requirements.

💡Caleb’s Pro Tip - Even though consensual towing does not require On-Hook the motor clubs will have insurance requirements for Auto Liability and On-Hook. We can review these contracts with you to make sure that your business is in compliance.

How much does Tow Truck Insurance Cost?

Policies for the most basic coverage ($300,000 and no On-Hook) start as low as $200 per month. As the limits and other coverage options are increased and added, the policy will go up in price. Most tow businesses that meet the higher insurance limits/coverages will pay about $425 per month.

⭐⭐⭐⭐⭐Juliano’s Garage “I have been doing business with Barbee for over 4 years. Great customer service! I recommend the agency for any of your commercial insurance needs.”

Insurance Options

Auto Liability - Texas state minimum for tow operations is $300,000 in Combined Single Limit (CSL). Coverage options go up to $1 million.
Physical Damage - Provides coverage for the tow truck at stated or agreed value. When insuring your truck make sure to include the amount of permanently attached equipment such as a boom or roll-back.
On-Hook - Coverage for vehicles that you are towing when they are on-hook or attached to the flatbed.
Garagekeepers - Coverage for nonowned vehicles stored at your yard that are in your care, custody or control.
Garage Liability - Provides liability coverage for your yard.
Medical Payments- Medical payments for at-fault or not at-fault accidents.
Workers Compensation - medical payments and compensation for employees injured on the job.

“Been having a hard time with my garage insurance and Jennifer here at Barbee Jackson got my fixed up!” ⭐⭐⭐⭐⭐Jonce Croft

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Garagekeeper - The most Overlooked Coverage

Many tow businesses think if they have On-Hook coverage then their customers' vehicles are covered in the event of an accident or theft. This is not true. On-Hook is only when you are transporting a vehicle, much like cargo insurance.

If you have a tow yard or repair shop then garagekeepers would provide coverage for non-owned vehicles in your care, custody and control. This coverage is very affordable running as low as $900 per year.

Frequently asked Questions

What if my insurance lapses?
If your insurance lapses for nonpayments Texas requires you to reinstate the policy within ten (10) days and sign an affidavit confirming that no accidents occurred during the time the policy was not in force.

What do most motor clubs require for insurance?
Most clubs and insurance providers that have tow coverage options on their personal auto policy will require $1 million in auto liability and $50,000 in on-hook. If you have a tow yard to store the client's vehicle they will also require a garagekeepers policy.

Can the policy be financed monthly?
Yes, we offer payment plans with a small down payment and ten monthly payments.

Get started today by calling (850) 389-2001 or fill out the form below to have an agent call you.