On-Hook vs. Garagekeepers: What’s the Difference?
What Is the Main Difference Between On-Hook and Garagekeepers?
The biggest distinction is often where the customer’s vehicle is and what the towing business is doing with it at the time of the loss.
While the Vehicle Is Being Towed or Transported
On-hook coverage may help protect a customer’s vehicle against certain covered losses while it is attached to, loaded onto, or being transported by the insured tow truck.
After the Vehicle Reaches Your Location
Garagekeepers coverage may apply to qualifying customer vehicles left in the business’s care, custody, or control at an insured storage, impound, service, or similar location.
The Coverage Need Can Change Once the Tow Is Finished
A towing business may have custody of the same vehicle through several stages. The insurance exposure while loading and transporting the vehicle can be different from the exposure after the vehicle is parked at the business location.
Loading & Unloading
Damage can occur while a vehicle is being winched, loaded onto a flatbed, connected to towing equipment, or removed from the tow truck.
Transportation
Accidents, shifting, contact with objects, and other covered events may create exposure while the customer’s vehicle is being transported.
Storage & Impound
Once a vehicle reaches a storage or impound location, theft, vandalism, collision, weather, fire, or other exposures may become relevant depending on the coverage form.
Customer Pickup
The business may remain responsible for the vehicle until it is properly released, so procedures for keys, access, documentation, and vehicle condition can matter.
What Should Tow Operators Review?
Limits should reflect the types and values of vehicles being transported and stored, as well as how many customer vehicles could be exposed to the same loss.
Vehicle Values
Consider whether the business regularly tows or stores higher-value passenger vehicles, commercial vehicles, specialty units, or other expensive property.
Number of Stored Vehicles
A tow yard with many customer vehicles can have a larger total exposure than a business handling only a few vehicles at one time.
Coverage Causes of Loss
Review whether the selected coverage addresses theft, collision, fire, vandalism, weather, or other causes of loss and what exclusions or deductibles apply.
Storage Procedures
Security, fencing, lighting, keys, access controls, vehicle-condition documentation, and release procedures can all be important risk-management considerations.
Does Your Tow Truck Policy Address Both Transport and Storage?
Best Formula Insurance can help towing businesses review on-hook coverage, Garagekeepers coverage, customer vehicle limits, tow truck liability, storage exposures, and other insurance needs.