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Why Is Tow Truck Insurance Going Up?

Why Is Tow Truck Insurance Going Up

Tow truck insurance rates are going up due to the increasing number of road accidents, the rising cost of truck repairs, and the increasing demand for insurance. Essentially, insurance providers pay more in claims nowadays. Truckers are filing for claims more often, so insurers have to charge higher premiums to compensate for their losses.

Factors Why Insurers Are Charging More for Tow Truck Insurance 

Do you think it’s unfair that insurers charge truckers more for insurance now than they did decades ago? Let’s shed some light on the issue. The rising insurance rates were brought about by the following:

  • Frequency of road accidents: Traffic accidents are occurring more frequently — over 5.2 million accidents on the road per annum. This means a vehicular mishap occurs every 60 seconds, which is one of the factors that insurers use to determine premiums.
  • Costs of repairs: The rising costs of tools and spare parts make tow truck repairs more expensive, which means insurers typically pay more for repairs now.
  • Rising vehicle prices: Brand-new modern-day tow trucks that come with several new features can cost up to $500,000. 
  • Commercial trucking trends: Truck insurance providers generally raise their rates if they notice more truckers filing claims.

Also, avoid limiting yourself to the cheapest policies. Several factors apart from costs affect the overall quality of a tow truck insurance provider, including financial strength, claims processing convenience, and coverage extensiveness. Explore your options. Skimping on insurance does more harm than good, especially if you end up needing to make a claim.

Frequently Asked Questions:

Why are tow truck insurance rates increasing?

Tow truck insurance rates are increasing due to the rise in road accidents, increased cost of truck repairs, and the growing demand for insurance.

What role does the frequency of road accidents play in insurance rates?

With over 5.2 million road accidents occurring annually, insurance providers have to raise premiums due to the increased risk and claims payouts.

How does the cost of repairs and rising vehicle prices impact insurance rates?

The rising costs of repairs and new tow trucks lead to higher insurance claims, which insurance companies offset by increasing their premiums.

Does your tow truck business have sufficient insurance? Assured Standard can help shed some light on the issue! Check out our quick piece on essential insurance requirements for towing service providers.

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